Contradictory report reveals Apple hasn’t inked China Mobile deal yet

china mobile

After the Wall Street Journal on Wednesday said that anonymous sources claimed Apple and China Mobile have finally inked an iPhone distribution agreement, most outlets, including us, reported it as a fact.

Add on top of that the carrier’s Suzhou subsidiary opened a reservation system for the iPhone 5s and iPhone 5c and the fact that China Mobile is gearing up to launch its fourth-generation Long-Term Evolution (LTE) mobile network this month and it’s no surprise that everyone bought the WSJ report.

But now, an influential news organization relays words of a China Mobile official who insisted that the deal has not been inked yet…

According to a report by Agence France Presse on Friday, the China Mobile deal is anything but inked at the moment.

China Mobile, the world’s biggest wireless operator, said Thursday it is still negotiating with US technology giant Apple over offering iPhones on its huge network and that a deal has yet to be reached.

“Talks between China Mobile and Apple on cooperation are still going on and we currently do not have anything to announce,” the carrier’s spokeswoman Rainie Lei told AFP.

The primary point of contention, as per AFP’s sources, appears to be Apple’s demand for sales volume guarantees. Another key hurdle: the amount of subsidy offered to China Mobile subscribers who wish to purchase an iPhone.

In general terms, Chinese government has a tough stance on device subsidies.

Two months ago, Sina Tech said Apple demanded that China Mobile promise a minimum target for the iPhone 5s/5c sales, prompting the carrier to reconsider the cooperation with Apple.

CNN Money reported that China Mobile in a brief statement issued Thursday confirmed that negotiations with Apple were “in progress,” but refused to comment further.

China Mobile is of crucial importance to Apple and future iPhone sales.

china mobile 5s

It’s the world’s largest carrier by subscribers, with around 700 million users, the equivalent of over twice the US population. China is also the world’s most populous nation with 1.33 billion people, representing Apple’s second-largest market in terms of revenue.

“I continue to believe that in the arc of time here, China is a huge opportunity for Apple,” CEO Cook said earlier this year.

The Chinese government on Wednesday granted state-owned China Mobile, China Telecom and China Unicorn, the latter two official iPhone distributors, 4G licenses.

Apple back in September was granted a regulatory license to sell the iPhone on China Mobile’s network, with the filings mentioning GSM-enabled TD-LTE radios inside the iPhone 5s and iPhone 5c.

A rather curious TechWeb story from last month claimed that China Mobile was allowing carrier profiles to be installed on the iPhone 5s and iPhone 5c units purchased in Hong Kong in order to enable the TD-LTE services in certain regions in mainland China.

This was necessary as the iPhones purchased in Hong Kong support 4G LTE, 3G WCDMA, CDMA2000 and TD-SCDMA and 2G GSM, but only 2G with a China Mobile SIM card.

Another article corroborated the TechWeb story, adding that ten China Mobile stores in Guangzhou, Guangdong Province recently started writing the carrier’s configuration file into these iPhones, allowing customers to use their handset with the China Mobile network without changing the SIM card or number.