Smuggled iPhones Not Hot In China - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

IoT
IoT
Comments
Smuggled iPhones Not Hot In China
Oldest First  |  Newest First  |  Threaded View
Page 1 / 4   >   >>
Lorna Garey
50%
50%
Lorna Garey,
User Rank: Author
9/29/2014 | 11:39:38 AM
Status
It all comes down to a status symbol -- what is that little logo worth? And to people who value such things, presumably being one of the first to have the phone, before the unwashed masses, is key. So yeah, seems like Apple should be worried.
Whoopty
50%
50%
Whoopty,
User Rank: Ninja
9/29/2014 | 12:45:17 PM
Grey markets, grey area
I was burned by grey market products once. After having picked up a stack of hard drives from a well known online retailer, a few of them failed and I found that neither my retailer warranty - which had as you might have expected, only just gone out of date - nor my manufacturer warranty were valid. The latter wasn't claimable since the product had been sold outside of its intended region, something I had no concept of at the time and wasn't aware of at the point of purchase.  

That particular company has cleaned up its act these days, but it's certainly something to watch out for and consider, especially if you know you're buying a product that's been shipped around. 
mmil105
50%
50%
mmil105,
User Rank: Apprentice
9/29/2014 | 12:48:46 PM
Did anyone do some basic fact checking?
The article says 'It doesn't help that the Chinese government has decreed US-made products undesirable.'

There's no such thing as a US-made smartphone!  Motorola briefly tried it when it was owned by Google, but EVERY iPhone sold in both the US and China is made in China!

Furthermore, I witnessed the lines of Chinese buyers in Manhattan firsthand and while they definitely don't look to be associated with any organized crime syndicates, the buyers are NOT actually smuggling anything into China either.  I witnessed (and the Neistat video clearly shows) the buyers handing off the phones as soon as they leave the store.

The main reason iPhone demand has dropped is because of the recent government crackdown in China on corruption.  Conspicious consumption (displaying expensive phones, watches, cars, etc.) is considered an important marker of status in China but now it is also considered to be grounds for investigation if someone is one of the tens of millions of government employees in the country.

An article in a tech magazine should have some very basic fact checking done before it's published.
Henrisha
50%
50%
Henrisha,
User Rank: Strategist
9/29/2014 | 12:51:45 PM
Re: Status
Now that you bring it up... Recently I have come across ads for iPhone 6 "1 to 1 replica", which are obviously knock-offs, at about a quarter of the actual phone's price. If you see it as a status symbol, you wouldn't be quick to jump at this "bargain"-- unless you'll be showing it off only in pictures, because clearly it won't work or even look like an actual iPhone in person.
TerryB
50%
50%
TerryB,
User Rank: Ninja
9/29/2014 | 1:17:00 PM
Re: Did anyone do some basic fact checking?
Instead of ragging on IW for "fact checking", check your comment for common sense. Who cares where it is manufactured, any legit sale of Apple product gives profit to Apple and thus US taxes. That is China's intent, they are being dinks because US has cracked down on them for dumping and quality/safety issues on their products. China doesn't care where they are made.

Nothing in your comment contradicts what Eric said. It's good point you make about corruption crackdown but who really knows the effect of that on black market items over there. Those long lines make a lot more sense now.
mejiac
50%
50%
mejiac,
User Rank: Ninja
9/29/2014 | 1:24:22 PM
Re: Status
@Loma,

This same trend can be seen in other third world countries, where phones aren't restricted to the carrier, and even more so, the local service provide actually encourage the black market because they're willing to activate any phone as long as they can support it.

For both Iphone and Samsung, and like any product that it's trending, black market smuggling will always exist.

 
mejiac
50%
50%
mejiac,
User Rank: Ninja
9/29/2014 | 1:28:13 PM
Laws of Offer and Demand
Erick,

First, great article!,

Like any given product, if it's somethign that's trending and also part of a fashion statement, it'll have a black market behind it.

This is obvious in many fashion clothing articles, so smartphones aren't shielded from it.

Same goes for Laptops and tablets... if it's something that consumers want desperatly, then a profit can be made of it.

Like you mentioned, I was monitoring ebay sales out of curiority, and was amazed at the prices people were paying for the Iphone 6 (versus simply being patient and wait for supplies to re-stock).

But here's a question: do companies like Apple and Samsung tend to fight it? or simply accept it as a byproduct of the popularity and demand they're seing with there flagship products?

What does the community think?
mmil105
50%
50%
mmil105,
User Rank: Apprentice
9/29/2014 | 2:05:25 PM
Re: Did anyone do some basic fact checking?
Did you actually read the article?  

It clearly says 'US-made products' NOT made by a company 'that gives profit to Apple and thus US taxes.'  If you believe that the article says China didn't care where the phone was made, why would the article say 'US-made products'?

I always check facts before I write something.  Many people, both here and in China, incorrectly believe that the iPhone is a US-made product precisely because of articles like this.

You also seem to agree about my analysis about corruption - just do a Google search for 'iPhone 6 China corruption.'  However, corruption is not even mentioned in the article, yet it is listed as the predominant cause by many legitimate sources.  The fact the iPhone 6 is yet another Chinese-made smartphone (though it is designed by a non-Chinese company) is a secondary cause at best.

All I am saying is that I expected some better fact-checking from a Tech publication.  
TerryB
50%
50%
TerryB,
User Rank: Ninja
9/29/2014 | 2:22:20 PM
Re: Did anyone do some basic fact checking?
You are opening a can of worms worrying about Mfg origins. Under your logic, Toyota would be a US product because we have plenty of manufacturing facilities here making Toyota's for US buyers. But none of profits stay in US.

Apple is a US based company, that is what China is targeting. And I'm guessing they wrote iOS in California. But everyone knows there is very little electronics made in US anymore. China's intent is to prevent US companies from gaining sales in their country, regardless of their mfg structure. Surely you understand that?

Because China is source of so many rare minerals, good luck finding anything electronic which doesn't have something from China in it, even if everything else done here.
CunC132
50%
50%
CunC132,
User Rank: Apprentice
9/29/2014 | 2:32:56 PM
Re: Did anyone do some basic fact checking?
Last time I checked "Assemble" does not have the same meaning as "make". I bought a damn iKea table which individual parts supplied and started assembling process to end up with a functional table. Did I "make" that table? fck no. I assembled it. Same case here.
Page 1 / 4   >   >>


The State of Cloud Computing - Fall 2020
The State of Cloud Computing - Fall 2020
Download this report to compare how cloud usage and spending patterns have changed in 2020, and how respondents think they'll evolve over the next two years.
Commentary
2021 Outlook: Tackling Cloud Transformation Choices
Joao-Pierre S. Ruth, Senior Writer,  1/4/2021
News
Enterprise IT Leaders Face Two Paths to AI
Jessica Davis, Senior Editor, Enterprise Apps,  12/23/2020
Slideshows
10 IT Trends to Watch for in 2021
Cynthia Harvey, Freelance Journalist, InformationWeek,  12/22/2020
Register for InformationWeek Newsletters
Video
Current Issue
2021 Top Enterprise IT Trends
We've identified the key trends that are poised to impact the IT landscape in 2021. Find out why they're important and how they will affect you.
White Papers
Slideshows
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll