The iPhone 5 will need a " TD-SCDMA chipset" if it wants a larger share of the China smartphone market, where it currently ranks seventh and Samsung is first, eweek.com reports .
Apple may be ecstatic about the landmark $1 billion patent war it won against Samsung, but a recent report shows that Apple is a lightweight contender in a much more crucial battleground.
Apple's share of the Chinese smartphone market was just a measly 7.5% during the first half of 2012, according to IHS iSuppli. That put the company in seventh place, behind Samsung (No. 1), Nokia (No. 5) and a host of native brands, including Lenovo, Coolpad, Huawei and ZTE.
That's not a position Apple is accustomed to -- in nearly every other region of the world where it sells iPhones, Apple is in either first or second place.
Seventh certainly not where the company wants to be in the critical Chinese market. China is set to become the largest smartphone market in the world later this year, IHS iSuppli says, with 160 million devices expected to ship by the end of 2012. That's more than double the 67 million smartphones that were shipped in 2011. Next year, the analysis firm expects the Chinese market to grow by another 26%, topping 200 million smartphones.
If Apple wants to grab a larger slice of that rapidly growing pie, it may have to make some concessions to Chinese consumers.
Price is a big issue -- the iPhone is a big-ticket item by Chinese standards. Phones aren't commonly subsidized by wireless carriers in China like they are in the United States, putting a top-tier device like the iPhone outside the price range of many Chinese consumers.
For those customers who would have to save up months of paychecks to purchase an iPhone, many instead opt for an array of pre-owned devices and knock-offs, which are widely popular in China.
But Apple CEO Tim Cook has said that the company has no plans to offer a less feature-rich device to compete with lower-cost smartphone manufacturers in the country.
"I firmly believe that people in the emerging markets want great products like they do in developed markets," Cook told analysts on a conference call in July. "And so we're going to stick to our knitting and make the best products. And we think that if we do that, we've got a very, very good business ahead of us."
Another strategy could be to develop an iPhone compatible with China Mobile's network, which has nearly 700 million subscribers.
"Among all the international smartphone brands competing in China, Apple is the only one not offering a product that complies with [China Mobile's] air standard," said Kevin Wang, the IHS report's author, in a press release. "For Apple, this is a huge disadvantage."
There have been rumblings and rumors of negotiations between China Mobile and Apple for years, but nothing has come of those talks yet.
Still, it's not an insurmountable problem for Apple. No single smartphone maker has a dominant lead in China -- No. 1 Samsung controls only 21% of the market.
Another research firm, IDC, is reporting somewhat rosier numbers for Apple. IDC puts Apple in fourth place -- not seventh -- with 10.1% of the Chinese smartphone market. That's still far behind Samsung (19%), but much closer to Lenovo (11%) and ZTE (10.4%).
"When you get right down to it, China is a gigantic freaking market," said Ramon Llamas, analyst at IDC. "And to have double-digit market share is a testament to the strength of your brand and your devices. It's something that's not born overnight."
In such a huge market, even 7.5% market share, he noted, is worth billions.
"Apple is in a very golden position right now, in that it's a hot brand and a lot of people want it," said Llamas. "There are a ton of vendors who don't even have one percent market share. They would love to have 10.1% market share."
With the rumored September 12 announcement date for the new iPhone arriving, many are wondering what Apple ( AAPL) will charge for the new device in the U.S.
When the iPhone 4S was released in America last October, it cost $199 for the 16GB model, $299 for the 32GB model and $399 for the 64GB model.
Many analysts are expecting the iPhone 5 will have a similar price in order to compete with products like the Galaxy S III.
Although originally reported that the iPhone 5 and buzzed about iPad Mini may both be revealed on September 12, All Things D's John Paczkowski has now confirmed that Apple will hold two separate press events to unveil its latest iPhone and the iPad Mini.
Before September 12, Video of the rumored front plate of the iPhone 5 has also leaked online.
The video, uploaded by someone from SmartPhone Medic, a smartphone repair service based in Columbia, SC., claims to have newly shipped parts from the iPhone 5.
You can watch the video by scrolling down to the bottom of the text.
If you're looking to trade in your "old" iPhone for cash, there's no better time than right now.
Rumors are rampant that Apple will announce
5 on September 12, with a release date soon after that. But if you want to offset the cost of your new phone by scoring the highest value possible for your old one, trade-in experts say you'll need to lock in your trade now -- before everyone else gets the same idea.
"We always get a rush of people who wait to get a quote until they have the new [iPhone] in their hands," said Jeff Trachsel, the chief marketing officer for trade-in service NextWorth. "But as the volume increases, the value of your phone declines."
Trading in now will help you avoid that rush and score more cash. Most trade-in services simply ask for you details about your device, like its storage size and condition, and offer up a price that's guaranteed for 3 weeks to a month. In turn, the companies typically refurbish and resell the devices.
Smart traders play arbitrage: Lock in a price now, then wait until you have the new phone in hand to actually send in your old model.
Old iPhones hold their value remarkably well. At NextWorth, a 16 GB iPhone 4S in good condition currently fetches $274. Rival site Gazelle is offering $277 for an AT&T phone or $260 for a Verizon or Sprint device.
Go one model older, to the iPhone 4, and you can fetch $175 at NextWorth for an AT&T phone or $162 for a Verizon phone. Gazelle will pay $160 to $165.
Demand for the latest, hottest iPhone has been a boon for those resellers, since some consumers upgrade their iPhones every year when the new model is announced.
Joe McKeown, a marketing vice president at ReCellular, said consumers typically traded in their "flip" feature phones about every 36 months. In the smartphone era, that's declined to 16-18 months, he said.
"Consumers are aware of that change, and they know they need to move quickly to get value," McKeown said. "Two weeks from now, we'll probably see lower value."
Anthony Scarsella, the "chief gadget officer" at Gazelle, said iPhone 4S prices have been "very stable" over the last few weeks. But he doesn't expect that to last.
The day new iPhones are announced "is kind of like our Black Friday," Scarsella said. "No question, the earlier you trade in, the more you get ahead of that volume, the better off you are. It's basically a fact that prices will dip heading into the announcement."
Significant changes to a new iPhone tend to make the old models' value fall a bit more than usual, Scarsella said. The iPhone 5 is rumored to have a redesigned body style.
Gazelle is extending its usual 30-day price lock-in for this iPhone cycle, the company announced Monday. Customers who get a quote between now and August 31 will have until October 1 to send in the phone.
Gazelle, ReCellular and NextWorth all said the iPhone ranks No. 1 for their most traded-in device. An up-and-coming but still distant second is the Samsung Galaxy line.
But the iPhone is unlikely to be dethroned any time soon, said NextWorth's Trachsel: "It's the perfect storm: a big carrier subsidy, strong residual value, and incredible consumer demand. Nothing else comes close."