Details of iPhone Negotiations Between Apple and China Mobile Emerge
The negotiations, which have reportedly involved both Steve Jobs and Tim Cook, initially stalled over Apple's request that China Mobile share 20-30% of their monthly iPhone revenues with Apple. While this business model was initially utilized in the United States with AT&T and the original iPhone, Apple has shifted away from revenue-sharing deals with carriers to more traditional arrangements involving handset subsidies. Apple and China Mobile, however, were also unable to come to an agreement on subsidies, with China Mobile objecting to Apple's demand that the carrier pay $600 per iPhone.
The most recent round of talks has broken down over Apple's App Store and China Mobile's reluctance to relinquish their tight control over China's mobile Internet offerings.
The third and final round of negotiations also broke down over Apple's insistence that it, rather than China Mobile, sell iPhone applications directly to customers via its online store. Wang saw the offer as a threat to China Mobile's dominance of China's mobile Internet industry, as Apple rather than China Mobile would collect money directly from customers under the deal.
"Wang said China Mobile should operate the application store itself in order to maintain its advantage," the source said.
Wang also pointed out that iPhone users in other parts of the world pay for applications by credit card, a model which would not be successful in China, where users prefer to pay through deposits in their mobile phone accounts. Under the latter arrangement, China Mobile would have to play a part in administering the purchase of iPhone applications in China, the source said.
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In fact, Apple should be paying China Mobile for every iPhone sold.
Hey, if they reach a deal in the next few months you'll KNOW this is what happened. I can't see either side giving in any other way.
Why can't they offer value added services to the backend which would be good for customers.
For instance:
* Instead of Voicemail: The carrier uses their speech recognition to send a text to your phone with text of the voice message and who/number it was from.
* Instead of listening to your phone ring or busy signal, people who call you get your public calendar (next freetime available?), latest GPS data, weather report, last time online, etc.
* When you call someone, it can send you an SMS with the Google Maps coordinates of you and the person you are calling.
http://blogs.computerworld.com/china_mobile_and_apple_cant_agree
It will be a cold day in hell when China Mobile goes along with Apple's plan (which is akin to highway robbery).
I'm sorry, I'm a bit confused. How is running the App store "highway robbery?"
Why can't they offer value added services to the backend which would be good for customers.
For instance:
* Instead of Voicemail: The carrier uses their speech recognition to send a text to your phone with text of the voice message and who/number it was from.
* Instead of listening to your phone ring or busy signal, people who call you get your public calendar (next freetime available?), latest GPS data, weather report, last time online, etc.
* When you call someone, it can send you an SMS with the Google Maps coordinates of you and the person you are calling.
This would involve Apple "approving" all of these services since they are likely going to require minor adjustments to the firmware. This isn't going to likely happen.
And you say the "nerve" of China Mobile? What about the "nerve" of Apple? They were collecting a portion of AT&Ts monthly bills! Where is the precedence for that business model? AT&T may win out in the end (which will take years to realize), but they have been bleeding money the last 2 quarter due to the iPhone. Finally Apple has met an entity just as stubborn as them. I hope they enjoy it!
Apple has certainly met its match here. It will be a cold day in hell when China Mobile goes along with Apple's plan (which is akin to highway robbery). It's just not going to happen. China Mobile knows they are holding all the cards in this game and know they are sitting on an absolute gold mine. I don't expect them to blink first. China Mobile is perfectly fine without them and Apple should realize this.
In fact, Apple should be paying China Mobile for every iPhone sold.
No I don't see it happening unless Apple create a Special Gift cards that can pay China Mobile balance and App Store, Revenue Sharing Could Work if Apple raise price of the phone for technical reasons and specific features to offset the cost of 20-30% meaning raise the price for the phone 20-30% make that 32GB and 64GB Module to increase the memory capacity because if they launch the 32Gb and 64GB there first that demand will be high enough to enable Apple to buy 2nd round 32GB and 64GB modules at a cheaper rate meaning the rest of the world will get cheaper pricing because this will make the 32GB & 64GB Memory module. Strategy in my book is to give them exactly what they want just a lot to where they choke on it. Then they gone be dependable on Apple to come through that's when you cut them off then negotiate them on new terms to where there future depends on Apple. :D
I'm sorry, I'm a bit confused. How is running the App store "highway robbery?"
I'm sorry, I'm a bit confused. Who said the "App store" is highway robbery? I'm talking about Apple's policy of collecting a portion of the subscriber's monthly bill.
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