Apple isn't having a good time in China, with Canalys' latest report showing that the iPhone's market share has dropped to just 5% in the second quarter of 2013. This is down from 9% in the same quarter of last year.
Canalys' China Research Director, Nicole Peng, told Bloomberg that Apple is getting hit by low-cost Android-powered smartphones that are being pushed by vendors such as Lenovo, ZTE and Xiaomi, which have all been pushing super-cheap smartphones with decent internal specifications. Peng said: "Apple is only focused on the high-end segment, and China's smartphone market growth right now is coming from the mid- to low-end. Apple doesn't have any products in the mid- to low-end and that's where Xiaomi has been building their brand awareness."
The world's largest wireless carrier, China Mobile, has close to 750 million subscribers, but Apple will not play ball with them. The Cupertino-based smartphone giant will not accept lower subsidies from the carrier, which is now hurting them, bad. Is this why Apple is reportedly working on the cheaper iPhone 5C?