Apple Drops WiFi in order to Launch iPhone in China

Apple has formally applied to launch the iPhone in China. The move, earlier than expected, appears to have been made possible once the firm agreed to drop WiFi capability.

There are both political and technical reasons for WiFi issues in China.

Until April this year, the government refused to allow any WiFi handsets. Officially that was because of fears users would add Internet phone services such as Skype and use those to make calls, to the detriment of China's phone companies. Unofficially it was thought the government believed WiFi would make it harder to monitor communications.

Censorship Suspected

When it did finally permit WiFi, the government insisted carriers use a special China-only standard known as WAPI (Wireless LAN Authentication and Privacy Infrastructure). Foreign firms are not allowed to see the full details of this and thus must produce handsets in cooperation with local companies. It's suspected the WAPI system allows the government to exercise some control over which websites are available. (Source: wordpress.com)

Wedger Partners, the analysts that discovered Apple's application for a license this week, say approval usually takes four to six months, meaning the phone should be on sale before the next Chinese New Year (February 14, 2010).

Setting The Standard

The analysts also say they believe Apple will not redesign the iPhone to run on the CDMA standard, favored amongst China's larger network carriers. Instead, they'll offer the existing GSM-compatible model and likely launch it through China Unicorn, a smaller firm which may limit its potential audience. (Source: businessweek.com)

While this will mark the official launch, the iPhone is already widely popular in China. Last summer it was revealed that 400,000 smuggled handsets had been unlocked and were running on China Mobile, the country's largest carrier. Today, it's estimated that as many as a million iPhones may already be in use unofficially in China. That may affect how much of a subsidy a local carrier is prepared to pay Apple in return for getting official customers onto its network.