Confirmed: Apple Reaches iPhone 4S Agreement With China Telecom

Apple sold 37 million iPhones last quarter, making it the top smartphone manufacturer in the world by volume. But interestingly enough, the record-breaking number didn’t include any sales from mainland China.

With nearly a billion wireless subscribers, China is a major opportunity for Apple to increase its handset sales. And it’s already starting to make its move. Earlier this month Apple launched its iPhone 4S on China Unicom, and now reports are coming in that it’s reached an agreement with China Telecom to do the same…

Marbridge Consulting is reporting that sources inside China Telecom have revealed that the carrier has reached an agreement with Apple to offer a CDMA version of its iPhone 4S. In fact, according to the source, China Telecom has already started accepting iPhone 4S preorders from government and enterprise customers, and is preparing for a first quarter [2012] consumer launch.

Even though China Telecom is only the third largest wireless carrier in China, it’s still one of the top 20 largest providers in the world. Add its 90+ million subscribers to China Unicom’s 160 million customers and Apple’s marketshare in China could grow substantially.

These numbers don’t even include China Mobile and its staggering 600 million subscribers, with whom Apple is said to still be in talks with. Analysts are expecting to see a China Mobile iPhone within the next 12 months. And once that deal goes through, it would be feasible to see Apple sell 35+ million iPhones on a quarterly basis. Wow.

Update: It’s now official. Apple reached an agreement with China Telecom. See Press Release below.

BEIJING – China Telecom Corp Ltd, the nation’s third-largest mobile operator, revealed it may launch the code division multiple access (CDMA) version of Apple Inc’s iPhone 4S in the Chinese mainland as early as February.

The move would ramp up the pressure on the company’s domestic rivals in the fight to win more subscribers to the third-generation (3G) network service.

In a news release on Monday, Beijing Telecom Co Ltd, a subsidiary of China Telecom, said the CDMA-version iPhone 4S is likely to hit the domestic market by the end of February, or at the beginning of March. However, no pricing details were disclosed.
“China Telecom has already started preparatory work for the launch of the iPhone 4S,” according to the press release.

Experts pointed out that it is possible for China Telecom to present the iPhone 4S as soon as possible, since the device, built for the company’s CDMA2000 network, has already obtained all three required operating licenses.

The CDMA2000 wireless standard is the 3G network technology used by China Telecom.

In mid-January, the China Radio Management Office granted Apple’s application for a handset that operates on the CDMA2000 network standard. China’s Telecommunications Equipment and Certification Center later granted the company the second permit.
On Monday, the CDMA-version iPhone 4S gained the final license, which recognizes the device as qualified and can now be sold on the Chinese mainland, according to the website of the China Compulsory Certification Online Service Center.

“Now China Telecom is almost ready for everything (to sell iPhone 4S),” said Xiang Ligang, a telecom expert who runs a web portal focusing on the Chinese telecom industry.

China Telecom’s introduction of the iPhone 4S can boost the subscriber numbers of its 3G network services, said Wang Ying, a telecom analyst with the Beijing-based research firm Analysys International.

“Launching the iPhone 4S on China Telecom’s own network will stop customers running to China Unicom and help attract new clients from domestic rivals,” Wang said.

Thus far, China United Network Communications Ltd (China Unicom), the nation’s second-largest wireless carrier, is still the sole operator offering the Apple device on contract. The iPhone craze has helped the carrier achieve the fastest-growing 3G user numbers in China, with more than 40 million subscribers at the end of 2011.

China Telecom had 36.3 million 3G users by that date, compared with 51.2 million for China Mobile Ltd.

For Apple, offering an iPhone compatible with China Telecom’s technology could encourage the use of the device by tens of millions of mobile subscribers. Apple is currently the No 4 smartphone vendor in China, lagging behind Nokia Oyj, Samsung Electronics Co and Huawei Technologies Co Ltd, according to the research firm Gartner Inc.