Apple has Chinese services business in sight with new app accelerator
Apple Inc has launched a new programme in Shanghai to encourage Chinese developers to create apps.
As part of the tech giant’s efforts to establish its services business in the critical Chinese market, the programme will hold lectures, workshops and networking sessions for developers.
While more than 2.5 million developers for Apple’s platforms are from greater China, Apple’s iPhone sales in the country have slowed, with chief executive Tim Cook believed to be targeting its services business as a silver bullet.
Apple will collect revenue from the apps, media and other software developed by the programme, which include sales from its iCloud and the App Store.
To tackle competition, Apple launched several financing schemes earlier this year to make iPhones more affordable for Chinese consumers. Chinese electronics retailers also reduced the price of some iPhone models.
Earlier this week a report from Evercore ISI predicted Apple Inc will likely see a surge in services revenue in the third quarter, charged by app store developer revenue and renewed growth in China.
The services business accounted for 20 per cent of Apple’s $58.02 billion (£46 billion) revenue in the second quarter, up from 16 per cent a year earlier. The App Store is a key driver of Apple’s services segment, which brought in $37.1 billion (£30 billion) in revenue last year.
Evercore analyst Amit Daryanani expects total App Store developer revenue to grow 18 per cent to around $9 billion (£7.2 billion) in the third quarter. Apple is due to report quarterly results on July 30.