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Lenovo: Apple is losing out in China
Published on: 2010-07-05
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Apple is missing a huge opportunity in the Chinese market, according to Liu Chuanzhi, the head of Lenovo, the country’s leading PC maker.

Speaking of Apple’s chief executive, Lenovo’s founder and chairman, told the Financial Times: “We are lucky that Steve Jobs has such a bad temper and doesn’t care about China. If Apple were to spend the same effort on the Chinese consumer as we do, we would be in trouble.”

His comments come as Lenovo recovers from the financial crisis, mainly boosted by its strength in China. The company holds about 30 per cent of its home market, which is one of the fastest-growing globally and which is expected to become the world’s largest within a year.

Apple’s products are proving to be as desirable for Chinese consumers as for their international peers, but official channels for their sale are extremely limited. The company has only a handful of flagship stores and authorised resellers in the country’s largest cities.

The iPhone has been legally available only via China Unicom, the country’s second-largest mobile operator. Sales have been sluggish, partly because the price tag for the phone is much higher than for iPhones sold through unauthorised channels.

Apple declined to comment on Mr Liu’s comments directly, but said it is set to open a new store in Shanghai this coming Saturday and was on track to have 25 retail outlets in the country by the end of next year.

Executives said in April that they saw the Chinese market as a major growth opportunity.

Mr Liu said the LePhone, Lenovo’s first signature product in its push into mobile devices, was well placed to compete with the iPhone in China because the device, launched earlier this year, was customised for Chinese users.

“This is a very practical thing. The iPhone has more than 100,000 content providers, and we have no more than 1,000,” he said.

“But our Chinese customers feel our applications are very convenient to use.”

The Lenovo founder said he expected China eventually to replace the US as a global trend-setter in technology as a take-off in Chinese domestic consumption would force global tech companies to set their development roadmaps to follow Chinese consumer tastes.

Other global PC companies such as Hewlett-Packard, Dell and Acer are pouring additional resources into China in recognition of its market potential.

However, Mr Liu suggested Apple was defying this logic. “Steve Jobs is a genius. He is the exception to my rule,” he said.

“My theory is that a manager needs to be the string on which he puts one pearl after another. But Jobs himself is a big pearl.”




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