Apple Shelves Retail Availability of iPhone 4S in China After Mobs Form in Beijing

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By Kim-Mai Cutler Comments

After mobs formed at an Apple store in East Beijing this week prompting concerns from government police, Apple decided to postpone retail sales of its newest iPhone 4S. It’s now only going to be available for online purchase for the time being.

The decision underscores rabid demand in China for Apple products. The market has quickly become the company’s second largest in terms of revenue and the country’s five retail outlets now support one-sixth of Apple’s total sales.

Like I said in September, the iPhone has become the most potent status symbol around for urban, white-collar Chinese consumers. It’s portable and visible wherever they go. It’s always on them, unlike clothes or fashion which might change from day to day. And at 4,988 renminbi ($790.93), it’s not cheap but it’s not out of reach. When I was there, iPhone owners would tell me that it wasn’t uncommon to save up for months or more than a year just to buy one. (Unlike the U.S., subsidized, post-paid plans are less common in China.)

Indeed, The New York Times said that migrant workers were being bussed in and paid 100 renminbi ($15.86) to scalp phones. Since Apple decided not to open the doors to its store in Sanlitun, a posh area that’s popular with expats in East Beijing, the migrant workers said they were only going to be paid 10 renminbi ($1.58) for food despite standing in freezing weather all night. It’s not clear how this will affect local sales over the next few months or weather it will dampen revenue growth in the country for the time being.

One factor that might have made the crowd a little crazier is that Apple decided to make the iPhone 4s available 10 days before Chinese New Years, when gifting family and friends is common.