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Apple's iPad a top seller in Beijing

By WANG CHAO (China Daily)
Updated: 2010-08-05 16:14
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Apple's iPad a top seller in Beijing
A customer takes a look at an Apple Inc iPad at a store in Hong Kong, China, on July 23, 2010. Jerome Favre/ Bloomberg News 

BEIJING - Apple's latest product, the iPad, is already a hot seller in Beijing - despite the fact that it has yet to be launched on the mainland.

One reason is Apple's policy of non-synchronized launches of its products. The iPad started selling in April in the United States, in June in Britain and last month in Hong Kong.

At Beijing's Zhongguancun area, the largest electronics market in the city, dealers have been selling genuine iPads for more than three months.

Lin Zheming, a dealer, said iPads have been selling from 4,500 yuan ($664), a premium over the $499 price advertised by Apple in the US.

"Three weeks ago, hundreds of iPads were available," Lin said. But since the end of last month, stocks have dwindled as demand has increased.

The iPad's made its debut in Hong Kong at prices similar to those in the US. For example, the cheapest model in Hong Kong sells for HK$3,888 ($500, or 3,400 yuan) while the most expensive 64G version goes for HK$6,488.

Yet, the Hong Kong launch has not reduced the prices of contraband iPads in Beijing by 1,000 yuan, as some prospective buyers were hoping.

"Even in Hong Kong, the iPad is in short supply," Lin said. "When the machine was launched in Hong Kong, hundreds of fans lined up to buy; even if I ordered an iPad right now, I would need to wait at least 10 days."

Smuggled iPads now cost a bit less - 4,200 yuan, only 300 yuan cheaper as "we need to pay the transportation costs to Hong Kong and risk being caught by customs", Xu Zhenjing, a dealer at the markets, said.

"If we are caught, the whole batch of goods will be confiscated."

Most sellers in Beijing are now sourcing iPads from Hong Kong, rather than the US.

"Large amounts of iPad from Hong Kong have yet to arrive," he said.

Xu complained that customs is tightening its checks and it has become more difficult to smuggle iPads.

Smugglers use three ways to bring iPads into China.

First, fly to the US and bring one back. If you bring in more than one, you risk being charged with smuggling.

Second, buy 10 iPads at the most in the US, fly to Hong Kong and then transfer the goods to Shenzhen, a mainland city that shares its border with Hong Kong. More iPads can be brought in at a time, but smugglers still need to survive random checks.

The third way is relatively slow, but safer and more sustainable: Buy iPads in the US, and then mail them back.

"The very first batch of iPads in Beijing came through one of these three channels," a seller said.

Apple has yet to decide the iPad's launch date for China, the company's China PR manager, Yang Yan, said.

"We are not allowed to comment on any product yet to appear on the market," Yang told China Daily.

Apple opened its first store in Beijing in 2008 and the second in Shanghai in July this year.

Chen Yongjun, associate dean of the business school at Renmin University of China in Beijing, said Apple's marketing strategy is "quite successful".

"By delaying the launch, Apple can create an impression that crowds of fans are lining up for iPads; for those who have bought them, the product become an item to show off," Chen said.

Chen said that despite some technical problems affecting other new Apple products, the status of the iPad or the company has not been lowered in the minds of fans.

Apple's third quarter financial report, released in July, showed it achieved a quarterly revenue of $15.7 billion, a 61 percent increase and the highest in its history, over the same period last year of $9.73 billion.More than 3.27 million iPads have been sold since April.

China Daily