The Wall Street Journal has reported Apple is subsidising operators in Japan to offer discounts on its phones owing to sluggish sales in the country.

Wei Shi

November 23, 2018

2 Min Read
Apple said to offer discount on iPhone in Japan

The Wall Street Journal has reported Apple is subsidising operators in Japan to offer discounts on its phones owing to sluggish sales in the country.

After claiming that the new iPhone models are moving slower than planned through its supplier and manufacturer checks, WSJ reported again that Apple is going to offer discount to its XR model in Japan, which is said to be falling short of plan the most. Due to channel price protection, it needs to compensate the mobile operators to do so.

The fact that XR, the cheapest of the three new iPhone models, was the worst performer may come as a surprise, though it is to do with Apple’s positioning. One could only speculate that those going for the premium would rather buy the more expensive models (the XS and XS Max). While those who are not after the newest would go for the older models.

Since last year’s premium model the iPhone X was stopped when the new models were launched in September, to avoid cannibalisation of the new XR, some consumers went back to the older models, the iPhone 8 series. The WSJ reported that Apple may resume the X both to move consumers to more premium (therefore higher margin) model and to fulfil its OLED display commitment to Samsung. The X is said to be cheaper to make than the XS and XS Max, said the WSJ.

Japan was one of the harder to crack markets for Apple when the iPhone was first launched. The country was dominated by DoCoMo’s internet-enabled iMode phones. It took Apple a couple of years before it could convince the Japanese users of the advantage of smartphones and app stores. It looks that Apple is once again having a difficult ride in Japan again.

About the Author(s)

Wei Shi

Wei leads the Telecoms.com Intelligence function. His responsibilities include managing and producing premium content for Telecoms.com Intelligence, undertaking special projects, and supporting internal and external partners. Wei’s research and writing have followed the heartbeat of the telecoms industry. His recent long form publications cover topics ranging from 5G and beyond, edge computing, and digital transformation, to artificial intelligence, telco cloud, and 5G devices. Wei also regularly contributes to the Telecoms.com news site and other group titles when he puts on his technology journalist hat. Wei has two decades’ experience in the telecoms ecosystem in Asia and Europe, both on the corporate side and on the professional service side. His former employers include Nokia and Strategy Analytics. Wei is a graduate of The London School of Economics. He speaks English, French, and Chinese, and has a working knowledge of Finnish and German. He is based in Telecom.com’s London office.

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