Analyst: iPhone 5C May Give Apple Leadership in China


Is the iPhone 5C Apple’s (NASDAQ:AAPL) ticket to success in the greater China market? Morgan Stanley analyst Katy Huberty examined the potential impact of the upcoming budget iPhone on the Chinese smartphone market and Apple’s overall earnings in a recent note to investorsBarron’s reports.

Huberty believes the iPhone 5C could start Apple “on the path to smartphone market share leadership” in China. She also foresees a related negative impact on Apple’s smartphone rivals, according to the publication.

The “iPhone 5C could increase Apple market share by 13 points in China, with the largest share losses at Samsung (SSNLF.PK), HTC, and Nokia (NYSE:NOK), according to our July AlphaWise survey of 2,000 Chinese handset users in tier 1-2 cities,” Huberty wrote, via Barron’s.  Despite what she called Apple’s “arguably lower specs,” she thinks the Apple brand and iOS platform will drive a share increase “across all pricing and product scenarios.”

“Samsung and tier 2 global smartphone brands like HTC stand to lose market share and/or see pricing pressure if Apple launches iPhone 5C or forms a partnership with China Mobile (NYSE:CHL),” she added.

Like many Apple watchers, Huberty predicted the iPhone 5C for launch sometime next month. Although she is not convinced what she calls a “formal China Mobile relationship” is a certainty, she does believe that any deal with China’s largest carrier could boost Apple’s market share in the country by another 6 points.

Rumors of an impending deal with China Mobile recently got a boost after CEO Tim Cook met with China Mobile Chairman Xi Guohua in Beijing late last month. According to an emailed statement from China Mobile via Reuters, the two executives discussed “cooperation.”

Follow Nathanael on Twitter @ArnoldEtan_WSCS

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