Blog Post

The phone maker that’s killing Apple in China arrives in the US

Stay on Top of Enterprise Technology Trends

Get updates impacting your industry from our GigaOm Research Community
Join the Community!

Chinese handset vendor Yulong, better known as Coolpad, is venturing out from its home territory to try its fortune in the U.S., with a little help from MetroPCS(s pcs). The prepaid, contract-free operator on Tuesday started selling Yulong’s Quattro 4G LTE Android smartphone (s goog) for $149.

Coolpad may be a virtual unknown here, but in China it’s the No. 3 smartphone maker. Not only is Coolpad besting Apple’s iPhone(s aapl), which ranks a woeful seventh, and Nokia(s nok); it’s even beating two of China’s hometown giants, Huawei and ZTE, according to IHS iSuppli.

Of course, Yulong has a long way to go before it can even dream of being that competitive in the U.S., but MetroPCS is a good place to start. The company is the largest regional operator in the country, and its focused on delivering cheap voice and data with no commitments (it recently started offering a promotional unlimited talk, text and data plan for $55 a month). But that also means that MetroPCS doesn’t offer the steep device discounts the major operators exchange for long-term contracts. To lure customers over to its new data services, MetroPCS needs cheap smartphones, which Yulong is prepared to deliver.

The Coolpad Quattro isn’t the Galaxy S III – which MetroPCS will also soon sell – but without subsidies it has a price tag that is $400 less than the Samsung phone. The Quattro runs Android 2.3 (Gingerbread), sports a 4-inch capacitive multi-touch screen and a 1 GHz single-core processor. It has both front and rear-facing cameras, the primary supporting 3.2 megapixels of resolution. It has 512 MB of RAM and a micro-SD slot that can take a 32 GB card.

The Coolpad Quattro and the LG Motion will be MetroPCS’s cheapest smartphones at $149 each, far undercutting its other 4G smartphones, which range from $229 and $459. Yulong is obviously crafting its U.S. strategy on selling budget devices. If it can continue to keep its prices this low it’s likely to attract attention from other operators.

23 Responses to “The phone maker that’s killing Apple in China arrives in the US”

  1. I am curious how all this will shake out. The lawsuit with Samsung, the prepaid market gaining high end phones (including iphone).

    I’m an android user and lost the iphone fever a while.

    What would the landscape look like if Jobs launched the iphone on all carriers in the beginning?

    Instead of letting Android develop and gain traction.

    Pandora’s box is definitely open.

  2. Actually in China Coolpad is a big name for smartphone. Their high end phones are well known, some compete with iPhone , although this phone is at the lower end even though a 4G phone

  3. Ghodagadi

    I think one reason Apple is not doing well in China is it does not produce a TD-SCDMA phone that can run on the largest network in China.

    That is of course Apple’s fault, but I am curious if you exclude China Mobile (or whoever is the largest network), then how does Apple fare in China? Does anyone know.

    Even so they can’t be a leader there, its phones are the most expensive and how many people in China could afford one.

    • Kevin Fitchard

      Hi Ghodagadi,

      Yep, all great points. I didn’t go into it in the post (though I linked to previous stories), but without China Mobile, Apple doesn’t have access to the operator with 70% of the market. Of course that hasn’t stopped Apple before. It was exclusive to AT&T for years and it competes in Japan without NTT DoCoMo. Price is also the another big factor since price tags for smartphones are a lot lower in China.

      I suppose I did write a pretty provocative headline here. But I think Yulong is also pretty provocative company. It’s one no one has probably ever heard of here. I wanted to point out why it was significant and the fact that an unknown is beating out not only global giants like Apple, but also home town giants like Huawei is pretty significant. I’m not claiming Coolpad’s going to pull off the same feat here in the US, though it appears a lot of people are reading that into the story.

  4. Anonymous

    I believe that Yulong is making the right move to launch in US and he could not go wrong starting off with Metro PCS. Remember that Metro Pcs is actually the leader in the game right now. Metro has always been on top of the game. Not only did they start the Unlimited movement but they were also the first company to offer 4G LTE. Not that WIMAX or HSPA+ crap that their so called competitors are offering!! They offer great technology at affordable prices and they do not lie to their clients about the network. They are in fact the PIONEERS and everyone else is just trying to be like Metro. Major companies now are actually asking for help and wanting to do the same things that Metro PCS does. As far as the “bottom feeders” comment, well without them most businesses would not be where they are today and well in my opinion…. They are alot smarter than all the idiots that invest so much into this Apple crap! First off iPhone advertises 4G when we have yet to see a real 4G iPhone. Not even the 4S is on 4G network! Its HSPA+ so gain some knowledge before trying to down talk anyone elses product. And Android is killing Apple right now that is why iPhone continues to bring a new version every couple of months just to keep you idiots entertained. OOOOHHHH a new shiny plastic…. WOOOOWWWWW. Let me invest hundreds of dollars into this deceitful phone only to have to purchase another one in 3 months! That is just STUPID!!! iPhone will not make it very far, it just so happens to be the “thing” right now but believe me… It will die out and they will lose alot of money in the long run.

    • eldernorm

      Anon,,,, WOW,, what a troll. LOL
      “And Android is killing Apple right now that is why iPhone continues to bring a new version every couple of months just to keep you idiots entertained. OOOOHHHH a new shiny plastic…. ”

      I think you have that backwards. Android phones keep coming out with slight variations every few months while we have been on the 3G, 4, and 4s for years now. And there is very little plastic in Apple products.

      While Apple is not selling more phones than Samsung, they are selling more of any specific model than anyone, and making the most money of them all. The iPhone is currently a bigger business than all of Microsoft combined.

      Now that is WOW. ps, I think I heard your mother calling. lol

  5. A “bottom feeder”?

    But this technology was the darling of smartphones just one year ago!

    If it’s rugged, the specs are quite adequate to meet the needs of all but the most hardened “geeks” among us!

  6. Henry 3 Dogg

    Considering that this product is aimed at the absolute bottom of the market, and Apple at the top, have you any evidence that this company is impacting Apple at all?

    The product that has been causing Apple some damage in China is in the process of being barred from sale in the US.

    • Steffen Jobbs

      Forget hoping for that. All the articles against Apple have something to do with these smaller companies beating the pants off of Apple in unit sales because Apple doesn’t sell iPhones for the price of these bottom feeder smartphones. These authors seem to think that Apple is unable to fight back against these little guys who are stealing all the crumbs Apple drops off the table. As though a company that has $120 billion in reserve cash couldn’t start selling low-cost smartphones if it absolutely had to. I’m not sure why Apple would even care to compete against Yulong. I personally feel that Apple shouldn’t attempt to interfere with smaller companies selling low-cost smartphones to the poverty-class consumers. I’m sure Apple is getting its pants beat off in Russia, India and Africa, too. But so what? Nokia used to control all those markets, but to no avail. The company collapsed because management didn’t know how to run a successful business model. Apple does and it doesn’t include the low-end consumer and probably never will.

      I don’t think it matters if Apple never has more than 15% market share in China. But I’ll be willing to bet that their profit share will be the highest of all companies. Apple likely brings in more revenue in a couple of days than Yulong brings in for the entire year. I see Yulong stock trades at around $1.4 HKD on the HK stock exchange. I don’t think Apple has anything to worry about from this company that’s beating Apple’s pants off in China. Maybe we should send Tim Cook an email telling him to keep his eye on Yulong.