China may Overtake US as Apple's Largest Market with Cheaper iPhone

Apple already won the hearts of Chinese consumers, but to win their money it will have to come up with more accessible prices. A recent report by Morgan Stanley suggests that Apple could almost triple its revenue from the Chinese market if the price of an iPhone dropped significantly.

The investment bank published a market survey pointing out that 85% of Chinese consumers would buy an Apple 3G iPhone, but they are reluctant to because of the price tag, Apple Insider reports. With the right price, Apple could boost sales by 2.6 times. Chinese customers looking for a 3G phone would agree to a maximum price of $425.

The users who admitted they were unlikely to buy an iPhone declared the top price they could afford would be $344. This conclusion supports by previous analysis claiming that an iPhone priced at around $350 would be hitting the 'sweet spot' and give Apple's sales a healthy boost on the Chinese market.

However, when it comes to brand prestige, about 80% of the Chinese respondents indicated Apple as the leading smartphone brand. In addition, the number of those intending to purchase an iPhone as their next handset is 4.5 times its current market share, giving Apple great prospects for expansion.

China is Apple's second largest market bringing into the company coffers about $4.5 billion in the third quarter of this year, accounting for 16% of total revenue.