'iPhone 5C' Projected to Give Huge Boost in China

While has experienced tremendous growth in China over the past several yrs and the market is now responsible for approximately 15% of 's revenue ch quarter, 's momentum has slowed there recently with themost recent quarterseeing a 14% decline in revenue in China yr-over-yr.

A Morgan Stanley analyst tm led by Katy Huberty relsed a bullish new report yesterday suggesting, however, that 's rumored lower-cost "iPhone 5C" could spark a surge in consumer interest for in China. According to a of 2,000 Chinese consumers in "Tier 1-2" cities, an iPhone 5C could ld to a 13-point smartphone market share boost for in China, with a rumored China Mobile dl potentially adding another six points. Combined, those two scenarios could push to a 36% share of the market in those cities, taking the ld from .
could significantly disrupt the Chinese smartphone market by launching iPhone 5C.We asked respondents that are very likely to purchase smart in the next 12 months but did not choose the iPhone whether they would purchase a redesigned and lower-priced iPhone 5C, one of the “Mini” products from international brands, or a comparable smartphone from one of China’s domestic brands. The indies could gain 13 points of unit share with iPhone 5C. About half of that share gain would come from , while most other vendors lose some share.
According to the , the "sweet spot" for pricing on the iPhone 5C among Chinese consumers is around RMB 4000 ($486), significantly higher than Morgan Stanley's estimated $399 pricing for the device, suggesting that consumers there will erally be satisfied with the iPhone 5C as amid-range devicerather than needing to compete at low-end price levels.

Morgan Stanley's results also show that two-thirds of potential iPhone 5C customers would be happy with a 3G device, as 4G networks have yet to see widesprd deployment in many ars of China. The data suggests that could boost profit margins and incrse differentiation with the iPhone 5S by not supporting 4G LTE on the iPhone 5C, although the company's plans for the iPhone 5C in countries where 4G LTE is more prevalent could drive to support the faster networks.

is expected to unveil the iPhone 5S at amedia event on September 10, with the iPhone 5C most likely appring at the same event.