Smuggled iPhones Not Hot In China - InformationWeek

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Smuggled iPhones Not Hot In China
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User Rank: Ninja
9/29/2014 | 1:24:22 PM
Re: Status

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.

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.
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.
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.
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. 
Lorna Garey
Lorna Garey,
User Rank: Author
9/29/2014 | 11:39:38 AM
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.
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