iPhone 4 Set For China Release

Apple will release the iPhone 4 in Chinese retail stores starting on 25 September. The release will coincide with the openings of Apple Store Hong Kong Plaza in Shanghai and Apple Store Xidan Joy City in Beijing.

The unlocked 16GB iPhone 4 will retail for the equivalent of $743 (£478), and the 32GB model for the equivalent of $892, according to a 19 September statement posted on Apple’s website. China Unicom will apparently offer the smartphone to “qualified buyers” with a new two-year contract.

Emerging market

Apple likely hopes that the iPhone 4 will perform better in the Chinese marketplace than the iPhone 3GS, which officially sold only 5,000 units in the days following its October 2009 release via China Unicom. “We believe that eventually China will emerge as a major market for iPhone sales, but it could take a year or two to gain meaningful unit traction as it did in the US,” Piper Jaffray analyst Gene Munster told Bloomberg at the time.

China’s “gray vendors”, who resell smartphones purchased abroad at inflated prices, are a factor weighing down those official sales numbers. Many of those vendors also traffic in cheaper counterfeit devices. The iPhone 3GS’ reported selling price of around $1,172 was another factor likely affecting sales.

Despite those headwinds, the iPhone 3GS had sold around 100,000 units through China Unicom by the end of 2009, according to reports circulating online. By contrast, the iPhone 3GS sold more than 1 million units within its first three days of release in the US, while the iPhone 4 sold roughly 1.7 million during that same period.

The Chinese iPhone 4 will join the Wi-Fi-only version of the iPad, released in that country 17 September. The 16GB version of the iPad retails in Apple Retail Stores and authorised resellers for the equivalent of $589; the 32GB for $708; and the 64GB for $826. That represents a premium over the pricing in the US, where the 16GB retails for $499, the 32GB for $599, and the 64GB for $699.

Both the iPhone and iPad face increased competition from other manufacturers determined to carve off their own piece of the smartphone and tablet markets. Many of those competing devices, including the upcoming Samsung Galaxy Tab, run some variation of the Google Android operating system. Morgan Stanley analyst Katy Huberty expects that sales of tablet PCs will reach 50 million in 2011.