Has China really decided to go to war with too-popular Apple?


By Noel Young, Correspondent

March 26, 2013 | 4 min read

Has China got it in for Apple? It is certainly beginning to look that way with two major swipes at the California colossus within the past week from state-run media. Forbes magazine even said, "It looks as if China's one-party state has just declared war on Apple."

Crowds as a Beijing Apple store opens

Yesterday the People's Daily criticised Apple for its reaction to a report on China's national TV broadcaster CCTV.

The investigative programme , “3.15,” had claimed the company discriminated against Chinese iPhone owners, offering shorter guarantees than in other countries, using refurbished rather than new parts, and shirking after-sale obligations, reported Apple's hometown newspaper, the San Jose Mercury News.

At the weekend, Apple had posted a message on its Chinese website saying it provides a 90-day warranty on repairs -- just like in the United States -- longer than the 30 days stipulated in Chinese law.

But the People's Daily, an official Government newspaper, was not satisfied .

* It attacked Apple for its "empty and self-praising" response to the earlier TV report on alleged poor consumer services.

* An editorial criticised Apple for not agreeing to interview requests from local reporters.

* In a separate article, the newspaper accused Apple of being "arrogant" and published a cartoon mocking the company's "empty" response to complaints.

Anna Han, a Santa Clara University business law professor advises U.S. companies operating in China. She told the Mercury News getting called out by the mouthpiece of the Communist government should concern Apple.

"You need to take these comments seriously," she said. "To me, it clearly is a target against Apple."

China is Apple's second-largest market after the US. Apple devices are very popular in China's middle class, from secretaries to high-ranking government officials. "It is so feverish among some customers that fights have broken out at Apple's flagship Beijing store during iPhone launches," said one report.

The bottom line: Apple revenues for the region have jumped 67 percent from a year ago.

"I am very happy with how things are going," company CEO Tim Cook told analysts during a conference call in January.

But the rush to but Apple goods has brought another swipe at Apple, reported by Forbes magazine.

From January last year to the end of last month, 20,000 students in the city of Wuhan had taken out “high-interest rate loans” from Home Credit China paying up to 47.12% in interest.

The Chinese students were generally portrayed as victims. So what were they buying?

According to the Xinhua News Agency -the same people who castigated Apple on CCTV over warranties - the money was spent on “fancy electronic products,” especially from Apple.

CCTV’s programme, which has run for 23 years, has nationwide bite, said Forbes. On Weibo, China’s equivalent of Twitter, Apple was mentioned 50,000 times in the first hour after the show’s piece on the company.

Back at Apple, company executives apparently did not see the storm coming, said Forbes.

“China is currently our second largest market,” Tim Cook said in January to Xinhua. “I believe it will become our first.”

The Forbes article concluded," It looks like China’s one-party state has just declared war on Apple. Its first attack failed. It will not give up."


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