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That's a big change from his old boss Steve Jobs, who never traveled to China. It demonstrates how important China is for Apple in the next five years.
What likely drove Cook's trip this time is a high-level face-to-face meeting with China Mobile's
But China Mobile would also greatly benefit from a deal with Apple. In the most recent quarter, China Unicom
Apple has been talking about the importance of China on its earnings call for several years now. So, Tim Cook deserves full credit for recognizing the opportunities here and getting way out in front of them.
In the company's fiscal second quarter last year, Apple did $7.9 billion in revenue from Greater China. This accounted for 20% of overall sales. Just to put that in some perspective, Google (NASDAQ:GOOG)
As impressive as this is, I don't think Apple's been as aggressive in China as it should have been. What I can't understand -- and what no one has been able to explain to me -- is why Apple has been so slow to open new stores in China.
It opened its first store in China in 2008 just before the Olympics in Beijing. It's one of the company's best-performing stores in the world. By the middle of last year, Apple had six stores in mainland China.
Back in early 2010, during a store opening in Shanghai, then-Apple retail head Ron Johnson estimated Apple would open 25 stores in China in the next two years. We are still far lower than that target. Why?
Johnson's departure from the company, and the recent firing of his replacement, may have something to do with it. But Apple is a well-oiled machine and once it commits to a goal, it typically delivers on it.
With all the financial success in China over this period, it's surprising that Apple wouldn't have fulfilled on its ambitious goal.{PAGE_BREAKMany other Western companies are going full steam ahead into China. Burberry (LON:BRBY)
I have heard people speculate Apple can't acquire the right locations in China and the right prices in order to proceed. Apple certainly has high standards but I don't think such an exercise with Apple's offshore cash resources would be that difficult.
The answer for Apple's retail presence reticence in China remains unclear.
Meanwhile, in the past two years, Android's software has flourished in China. It has been well-advanced by Samsung (KRX:005935), of course, in China. The Note and Galaxy are especially popular among Chinese elites and mainstream. But Android has also been seized upon by all the Chinese handset makers like ZTE and Huawei. Even Alibaba Group and Baidu
Google doesn't really benefit from this Chinese growth of Android. It gets nothing from the handset makers and Google doesn't even get the mobile information sent back to them. Baidu is used by most for search. Local mapping partners handle Chinese maps. Google doesn't even get geolocation data.
But the fact that Google doesn't benefit from Android's growth in China doesn't make it any better for Apple. Apple is still playing catch-up now in China, where it was seen as being more in a position of strength only earlier in 2012.
No doubt this is partially behind Tuesday's report that Apple is working on a cheaper iPhone for release later this year. Apple likely realizes that it must be able to grab a meaningful share of this exploding mobile market in China and other emerging markets. A $650 device will only take you so far in those markets.
There is still enormous opportunity in China for Apple. Tim Cook seems fully aware of just how big the opportunity is. We will just have to see if the "go slow" approach over the last two years will put Apple at a big disadvantage.
This article was written by an independent contributor, separate from TheStreet's regular news coverage.
