Apple chief executive Tim Cook held a press conference Wednesday to tout his company’s new agreement with China Mobile, the world’s largest wireless carrier.
“We’ve gotten to know each other….today is a beginning, and I think there are lots more things our companies can do together in the future,” Cook said in the briefing to Chinese media, as reported by the Wall Street Journal (subscription required).
That suggests that the deal to sell iPhones through China Mobile — which starts Friday, January 17 — may be just the beginning.
Apple manufacturer Foxconn has already shipped one million iPhones to China Mobile in preparation for this Friday’s on-sale date. And analysts cited by the WSJ estimate that the carrier could sell anywhere from 15 million to 39 million iPhones in 2014, adding substantially to Apple’s bottom line. For context, Apple sold 33.8 million iPhones worldwide in its fourth quarter 2013.
China Mobile is the biggest carrier in China — and the world — with 760 million customers, about seven times more than that of the largest U.S. carrier, Verizon. According to Cook, the deal will put the iPhone on sale in over 3,000 locations around China.
There’s undoubtedly demand for the iPhone in China, where there has been a thriving black market for the devices almost since the day the first iPhone launched in 2007. But as in the rest of the world, the iPhone faces increasingly stiff competition from cheaper Android smartphones. Making things even more challenging for Apple, the iPhone is even more expensive in China than it is in the U.S., at $870 for a 16-gigabyte iPhone 5S. Even the supposedly “inexpensive” iPhone 5C is pretty pricey by local standards.
“Apple has always been about making the best products, not the most products, so that’s always our North Star and that’s not going to change ever,” Cook told the reporters, indicating that he’s perfectly comfortable with Apple’s current approach: dominate profit share, not market share.
But if iPhones are just the beginning, who knows what may come next?
On that point, however, Cook was not forthcoming.