Apple's revenue falls 33% inChina, meaning the country is no longer its number two market, and Tim Cook's company has a big task ahead if it wants to claw back market share. Ryan Brooks reports.
The Apple factor has been slipping for a while in China... But in Tuesday we got a glimpse of just how bad things are getting. Q3 sales down a third from last year - the worst decline anywhere in the world - costing China it's title as Apple's most important market outside the U.S. It's well known that the Chinese economy is slowing... but as Brenda Goh reports from Shanghai, there's a lot more to Apple's problems than that. SOUNDBITE (English) BRENDA GOH, REUTERS, SAYING: "People say that the iPhone is becoming less of a status symbol in China. It's becoming more of a commodity that people are less likely they want to brag about. What's popular as status symbols nowadays is like holidays or lifestyle experiences so rather talk about your iPhone, they rather talk about that holiday to that exotic location that none of their friends have been to." Chinese consumers may be harder to impress than before... but there's also the ever-growing problem of competition in a market packed with cheaper local brands. SOUNDBITE (English) BRENDA GOH, REUTERS, SAYING: "The top selling handset in China isn't Apple. It's more like Huawei and Xiaomi, and these are more popular because they have a better app-eco system also they have shorter product cycles. They come out with new products that the fickle consumer likes and also they come out with a lot new features and games, which attracts them to a much broader population as well as the price of course." To make up for lost ground, Apple's trying to boost services like music and the app store... but that's easier said than done after Beijing shut down the iBooks and iTunes movie stores in April. The next generation iPhone is expected to launch this fall... potentially with a dual camera feature. That may sounds cool to tech fans round the world... But some of Apple's cheaper rivals in China have already rolled it out.