The mystery of the missing iPhones has been solved: they are in China, according to China Mobile and In-Stat.
The US research firm said in a note last week that China Mobile has reported 400,000 unlocked iPhones using its networks at the end of 2007. That represents nearly a quarter of the 1.7 million shipped iPhones, unaccounted for in AT&T and Apple sales figures, that have puzzled analysts.
The China figure represented "one out of every ten iPhone shipments announced officially by Apple," said In-Stat, which says the figure was four times higher than its previous estimate. The device is being sold in China through gray channels thanks to importers who have been able to source volumes of unlocked devices.
Of course, iPhone would do a lot better by being sold directly by China Mobile. In-Stat reasons that the China smartphone market is much more entertainment-oriented than the enterprise-driven US, which plays directly to the iPhone's strengths. It also estimates that 20% of handsets sold in China in 2007 cost more than 4,000 yuan, suggesting a market of "28 million potential" iPhone users.
But that is some time off. Apple and China Mobile broke off talks on selling the iPhone after just one meeting, with Mobile rejecting the US firm's revenue share model. For now, for consumers Mobile and Apple, it's the gray market or nothing.