Is the iPhone about to explode in China? Morgan Stanley thinks so. The firm released a report yesterday that has since attracted a lot of attention, and more than a little suspicion, from the Chinese tech media.
Basically, the Morgan Stanley analyst believes Apple (NASDAQ:AAPL) can vastly up its iPhone sales in China, reaching 40 million by 2013, if it can get access to China Mobile’s (NSYE:CHL, HKG:0941) subscribers, which has vastly more high-end subscribers than any of the other telecom operators in China. (The iPhone is currently only available on China Unicom, although unlocked phones are used on other networks). See the image below for an illustration of this.
Morgan Stanley expects the new iPhone to launch on China Mobile’s 4G-LTE network in late 2012 or early 2013, and sees that driving massive sales of iPhones. Chinese analysts aren’t so sure.
There are plenty of reasons for skepticism. First, while high-end phones are becoming more popular in China, the iPhone might be better classified as uber-high-end….at least when it comes to price. White collar workers willing to shell out a few hundred dollars for a smartphone may not be willing to shell out the near-thousand it will take to get an iPhone when the thing finally comes to China Mobile for real.
Moreover, China Mobile’s 4G network is currently in regulatory purgatory, and may remain there for a while as China attempts to develop the 3G market.
Of course, it’s all hypothetical at this point. Do you think Apple is going to hit 40 million iPhone sales in China this year?