In a strategic move to counter the declining iPhone sales in the world’s largest smartphone market, Apple is set to introduce its renowned classical music app in mainland China. This expansion aims to augment the digital services offered by the US tech giant.
Apple Music Classical’s Mainland Debut
Scheduled for January 24, the Apple Music Classical app, initially launched globally in March last year, is poised to make its debut in mainland China. The company announced this development through its online China App Store. Branded as the world’s largest classical music catalogue, boasting over five million tracks, the app is now available for pre-order for iPhone users in the country.
Simultaneous Launch in East Asian Markets
Expanding its reach beyond mainland China, the standalone app will also be released on the same date in five other East Asian markets, including Hong Kong, Macau, Taiwan, Japan, and South Korea. Apple’s announcement on X, formerly Twitter, confirmed this simultaneous release strategy, reflecting the company’s commitment to catering to a broader audience in the region.
Strategic Significance in China’s Digital Market
This move holds strategic significance for Apple, particularly in bolstering its major digital services business in China. Despite challenges, China remains the company’s largest market concerning App Store-related revenue. According to a study by the Analysis Group, published on Apple’s website in May last year, China accounted for a substantial 51 percent of the total US$1.1 trillion in billings and sales facilitated by the App Store ecosystem in 2022.
Comparatively, the United States generated almost 25 percent, while Europe accounted for 11 percent of the App Store ecosystem’s overall billings and sales in the same year.
Impact on iPhone Sales and Market Dynamics
The question of whether the local release of the classical music app will positively impact iPhone sales on the mainland remains uncertain. With overall consumption still weak across the country, Apple faces stiff competition from major Chinese smartphone rivals.
In the first week of the year, iPhone sales on the mainland witnessed a significant 30 percent year-on-year decline, according to a Jefferies research note. The brokerage noted a notable increase in discounts for iPhone 14 and 14 Plus models, while the newer iPhone 15 and 15 Plus models experienced a moderate rise in discounts.
Chinese smartphone vendors, led by Huawei Technologies, Xiaomi, and Honor, exhibited much stronger momentum during the period, delivering flattish growth year on year. Jefferies analysts indicated that Apple’s total iPhone sales volume on the mainland was down 3 percent from 2022, resulting in a 0.4 percent decline in market share.
Despite the challenges, Apple remains optimistic about the long-term prospects in China. In an earnings call in November, Apple CEO Tim Cook reassured investors, stating, “Over the long term, I view China as an incredibly important market, and I’m very optimistic about it.” Cook’s two visits to the mainland in the previous year, where he engaged with senior government officials, Chinese developers, and Apple’s contract manufacturing partners, underline the company’s commitment to navigating the complex Chinese market landscape.
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