Apple 2.0

Covering the business that Steve Jobs built

China Mobile has been meeting secretly with Steve Jobs

August 18, 2011: 6:28 AM ET

Apple reportedly in highest-level talks with the world's largest mobile operator

Source: todaysiphone.com

At a news conference following release of its first-half earnings, China Mobile (CHL) revealed Thursday that it has met several times with Steve Jobs to talk about Apple (AAPL) making an iPhone that would support its proprietary 3G standard, Reuters reports.

Officially, Apple sells iPhones in the world's largest cell phone market only through China Unicom (CHU), the country's second largest carrier. But even without a contract with Apple, China Mobile -- the world's largest mobile phone operator with more than 600 million subscribers -- says it already has 7.44 million iPhone users on its network.

The iPhone is in extremely high demand among China's growing middle class, and China Mobile responded last year by offering its customers a microSIM card that fits the iPhone 4. But because Apple's device doesn't support China Mobile's home-grown TD-SCDMA standard, those customers aren't getting 3G speeds. According to a rumor widely circulated earlier this month, China Mobile has already signed a deal to carry a next-generation iPhone that would deliver high-speed Internet access to its network.

Although the report of Jobs' direct involvement is new, Apple has been keeping a close eye on the Chinese market for some time. In July, COO Tim Cook reported that Apple's sales in Greater China grew six-fold year over year in Q3 to $3.8 billion.

"This has been a substantial opportunity for Apple," Cook told analysts. "I firmly believe we are just scratching the surface right now."

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About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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