Apple (Nasdaq: AAPL ) has just taken an important step in digging deeper into the wallets of its Chinese customers. How? By finally accepting the Chinese yuan as an acceptable currency for making purchases from the App Store.
Previously, to get their downloads, Chinese consumers had to contort themselves fiscally by having to use dual-currency credit cards. That was such a hassle that many found it easier just to use non-Apple-authorized programs, even though that meant hacking their iPhones. It also led some to fraudulent behavior, such as using counterfeit gift cards and false identities.
China is a huge market for Apple, accounting for 16% of its revenue in the third quarter. CEO Tim Cook said that China is Apple's "fastest growing region by far." The company now has six Apple stores in what it calls "Greater China" -- that is, mainland China, Taiwan, and Hong Kong. And its iPhone has 10% of the smartphone market there, behind Nokia (NYSE: NOK ) , Samsung, and Huawei.
But the potential for iPhone sales growth is really huge. Right now, the only telecom in China that has the iPhone is China Unicom (NYSE: CHU ) , the country's second largest carrier, with more than 192 million subscribers. Only about 25 million of those have the iPhone.
The country's largest carrier is China Mobile (NYSE: CHL ) with well over 600 million subscribers. Yes, 600 million, and its chairman, Wang Jianzhou, has been in talks with Apple, trying to get the company to bring out an iPhone for his company's not-yet-rolled-out 4G TD-LTE network. Given how well Apple has done so far raking in revenues and profits, I'd say the potential money to be made is, ahem, quite large.
It looks, then, like this decision to make it even easier for iPhone users to download their apps is quite a smart move and will create an even more lucrative position for Apple in China.
Want to take advantage of our new wireless world? Then pick up a copy of "3 Hidden Winners of the iPhone, iPad, and Android Revolution."