Apple CEO Meets With Chinese Mobile Carriers in Beijing

By Wayne Ma

BEIJING--Apple Inc. (AAPL) Chief Executive Tim Cook is in Beijing this week meeting with China's largest mobile carriers as the company faces a tougher environment in its second-largest market.

Mr. Cook met with China Mobile Ltd. (K3PD.SG, 0941.HK) Chairman Xi Guohua on Tuesday, a spokeswoman for the carrier said. Apple's CEO also met with officials at China Unicom (Hong Kong) Ltd. (0762.HK, K3ID.SG) on Wednesday, a person familiar with the matter said. It wasn't clear whether he met with China's third mobile carrier, China Telecom Corp. (K3ED.SG, 0728.HK) A China Telecom representative didn't immediately respond to a request to comment.

Apple representatives in China didn't immediately comment on the visit.

Although details of Mr. Cook's meetings weren't available, China Mobile repeatedly has said it is in talks with Apple about an iPhone deal. China Mobile is the country's largest carrier with 700 million customers, but it doesn't sell an iPhone fully compatible with its mobile network. China Unicom, the country's second-largest carrier, began selling the iPhone in 2009, while China Telecom began selling it last year.

Mr. Cook's visit comes a week after Apple reported that its revenue from Greater China, which includes Hong Kong, China and Taiwan, fell 14% in the fiscal quarter ended June 29 from a year earlier to $4.6 billion. The figure also represents a 43% decline from the previous quarter. Mr. Cook said Apple's Greater China sales in the third quarter were down because of seasonal factors and weighed by weak sales in Hong Kong.

Apple has also recently come under fire for its warranty policies and manufacturing practices in China. The Cupertino-based company issued a rare public apology in April after state-run Chinese media criticized its repair and return policies in mainland China.

Earlier this week, China Labor Watch, a New York-based nonprofit, accused Apple's Taiwanese contractor Pegatron Corp. (4938.TW) of withholding worker pay and poor living conditions. The workers' rights group specifically pointed to treatment of workers assembling a cheaper version of Apple's iPhone, which the U.S. company is preparing for launch as a way to counter cheaper options from rivals such as Samsung Electronics Co. (005930.SE) and HTC Corp. (2498.TW) Apple said it would investigate the claims and that it has fixed some problems identified by the group.

Meanwhile, Mr. Cook's visit marks his third public trip to China since becoming CEO in 2011. The CEO previously met with the head of China's Ministry of Industry and Information Technology in January. Mr. Cook's first trip included a meeting with senior Chinese leader Li Keqiang, a tour of a manufacturing facility in the city of Zhengzhou and a visit to a Beijing-based Apple Store.

-Paul Mozur contributed to this article.

Write to Wayne Ma at [e-mail]

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