China has become an increasingly important part of Apple’s empire, and today it looks like the company has taken one more step to growing that even more: the company is now accepting payments in Chinese Yuan on its App Store.
The change, reported by the China-based blog Penn-Olson, will mean that users can pay for apps in the store using local bank cards from major Chinese banks.
In the past, users were only able to use credit cards that could process U.S. dollar transactions — that would have cut out many users who would have only be able to use free apps legally. And — not unlike one of the root causes of music piracy — in all likelihood the difficulties in paying would have contributed to a large black market for paid apps.
There have been a number of local players who have jumped into that void to make it easier for iPhone and iPad owners to get the apps that they want: most recently Tencent launched its own iTunes-alike to help users sync apps legit and pirated to their devices.
Now, users can either enter payment information from cards issued by supported banks, or they can top up their iTunes accounts with yuan, in increments of 50, 100, 300, and 500 renminbi, which then gets deducted as they purchase apps.
Penn Olson notes that accounts topped up rather than linked to credit or debit cards are a common route for paying for mobile services in the country. (We pointed out another use of the top-up here: China Mobile uses it as a way to offer WiFi access to its users.)
Apple (NSDQ: AAPL) is still not accepting third-party payment platforms like Alipay from Alibaba or PayPal, and it’s not clear if they will open iTunes to these competitors.
Recently, Apple ramped up its presence in the Chinese market with the launch of several new, shiny retail stores in key cities like Shanghai (which now has three). Apple has noted that its retail stores in China see the most traffic of any country’s retail operations.
The Asia Pacific region, which includes China in Apple’s reporting, is a close third in revenues for the company, behind the U.S. and Europe, but it is seeing by far the most growth. In its Q4 results reported in October, Apple said that Asia Pacific grew the most of any region both in terms of units sold and revenues. Respectively, they were up by 61 percent and 139 percent.
Within that Tim Cook, the CEO, noted that Greater China was growing at a “feverish” rate and now accounts for 16 percent of all of Apple’s revenues, or about $4.5 billion in the last quarter.
Apps are big business in China — as evidenced by the dozens of app stores that have sprung up from operators, handset makers and internet portals (a trend driven hugely by the boom in open-source Android devices — many of these app stores are geared at those users). Mobile app downloads in China are projected to reach 5.5 billion next year, according to ABI Research.