Tim Cook’s visit to China may help build bridges with consumers, developers, local companies

The Apple CEO is visiting China less than a week after his company invested in the country's largest ride-hailing company

Apple CEO Tim Cook tweeted on Monday from Beijing a photograph of himself and Didi Chuxing’s President Jean Lui catching a cab, showing off the company’s spanking new relationship with China’s largest ride-hailing firm.

A US$1 billion investment in Didi, announced last week, could be the harbinger of a long-term relationship that some analysts speculate could lead to the U.S. company partnering with the ride-hailing company not only in providing software and services, but also down the line in jointly developing self-driving cars.

Apple, however, faces a number of challenges in China. It has seen its revenue from the country, its second largest market, dip by 11 percent in the last quarter as smartphone uptake slowed down in China.

The company faces regulatory challenges  as well. The State Administration of Press, Publication, Radio, Film and Television is said to have ordered the company to shut down its iBooks Store and iTunes Movies only six months after the services were launched in the country, amid growing concern about increased regulation and censorship of online services.

The investment in Didi is likely to have gone down well with the Chinese government, which has attempted with considerable success to attract U.S. technology companies to invest in local companies. Some tech companies like Hewlett Packard Enterprise, AMD and Intel have partnered with local companies as a way to get easier access to the local market. In February, Apple launched its Apple Pay service in tandem with bank card network China UnionPay, in a market where there are powerful players like Alipay.

It's unclear if Cook has any meetings planned with regulators, said Bryan Ma, vice president for devices research at IDC. “I suspect that there are many reasons for his visit, particularly to build up his local relationships in China, including consumers and developers (not just regulators),” Ma added in an email.

At an Apple store in Beijing, Cook attended a seminar Monday, hosted by Lui, with some of China's top app developers, according to CNBC.

Apple did not immediately comment on the purpose of Cook’s China visit or whether he would be trying to sort out the iBooks Store and iTunes Movies issue during his visit.

Cook is also probably sending a message to shareholders about the potential that he sees in China, show his commitment and confidence, despite all the questions that have been raised about a slowdown in the country, Ma said. “Indeed, one could argue that the investment in Didi Chuxing is also a statement to that end, and of course him being there this week lets him spend time with that team too,” he added.

Cook has said that he sees great potential for Apple in the Chinese market. In a recent interview with Jim Cramer of CNBC's Mad Money program, Cook said that the middle class in China is expected to soar from 50 million people five years ago to almost 500 million in the next five years. “This is an unprecedented growth of the middle class,” said Cook, adding that he “could not be more optimistic about China.”

Local vendors, such as Huawei, Vivo and Oppo, are cutting into the premium segment that once Samsung and Apple considered their own, reported Canalys in April. Smartphone shipments in China grew by only 2 percent year-on-year to over 105 million units in the first quarter with Huawei, Vivo, Xiaomi, Oppo and Apple making up the top five. Apple’s iPhone shipments fell a whopping 15 percent year-on-year, while market leader Huawei had a 48 percent year-on-year increase in smartphones shipped in the country.

During his visit to China, besides building bridges to companies like Didi and mending fences with the government, Cook is likely to explore new opportunities for the company as well as size up the growing competition from local players like Huawei. Signing up developers may help him build the app and services ecosystem that could help Apple compete better in the market.

Join the PC World newsletter!

Error: Please check your email address.

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

John Ribeiro

IDG News Service
Show Comments

Cool Tech

Crucial Ballistix Elite 32GB Kit (4 x 8GB) DDR4-3000 UDIMM

Learn more >

Gadgets & Things

Lexar® Professional 1000x microSDHC™/microSDXC™ UHS-II cards

Learn more >

Family Friendly

Lexar® JumpDrive® S57 USB 3.0 flash drive 

Learn more >

Stocking Stuffer

Plox Star Wars Death Star Levitating Bluetooth Speaker

Learn more >

Christmas Gift Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

GGG Evaluation Team

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Steph Mundell

LIFEBOOK UH574

The Fujitsu LifeBook UH574 allowed for great mobility without being obnoxiously heavy or clunky. Its twelve hours of battery life did not disappoint.

Andrew Mitsi

STYLISTIC Q702

The screen was particularly good. It is bright and visible from most angles, however heat is an issue, particularly around the Windows button on the front, and on the back where the battery housing is located.

Simon Harriott

STYLISTIC Q702

My first impression after unboxing the Q702 is that it is a nice looking unit. Styling is somewhat minimalist but very effective. The tablet part, once detached, has a nice weight, and no buttons or switches are located in awkward or intrusive positions.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?