Apple
stores in Beijing and Shanghai have delayed the release of the iPhone 4S after
a scene outside a Beijing store turned ugly early Jan. 13, with angry crowds
fighting and throwing eggs at one of the buildings.
Crowds of
hundreds, according to the Associated Press,
waited outside overnight in 20-degree temperatures, only to be told in the
morning—after the flagship store in Beijing didn't open at 7 a.m. as expected,
and the crowd became rowdy—that the store would not open and no one would get
the coveted device.
To ensure
the safety of customers and employees, the iPhone "will not be available
in our retail stores in Beijing and Shanghai for the time being," Carolyn
Wu, an Apple spokesperson in Beijing, said in a widely reported statement.
Chinese
consumers have proved to have an insatiable appetite for mobile devices, though
the Apple brand holds particular cache, and the country—along with the United
States—has become a top earner for Apple, bringing in more than 10 percent of
sales in 2011. During Apple's 2011 fourth fiscal quarter, it opened a new store
in Hong Kong, one of the 25 that officials have said they plan to open over the
next few years.
"Our
Hong Kong store joins our five other China stores as the highest traffic and
among our highest revenue stores in the world," Apple CFO Peter
Oppenheimer said during an Oct. 18 earnings call.
CEO Tim
Cook added later in the call, "Certainly in my lifetime, I've never seen a
country with as many people rising into the middle class that aspire to buy
products that Apple makes. I think it's an area of enormous opportunity, and it
has quickly become No. 2 on our list of top revenue countries very, very
quickly, and we're obviously placing additional investment."
The crowds
outside the Beijing store, according to reports, weren't necessarily that
middle class, but paid placeholders waiting to buy devices that scalpers
planned to resell on the gray market. According to the Los
Angeles Times, Apple's policy of selling a limited number of devices to
each customer has encouraged scalpers to "organize large groups to swarm
product releases, hoping to resell the products at a cut above retail."
One
scalper interviewed in the report said he had organized 500 buyers to wait
overnight for the iPhone 4, bragging that his recruits—students and the
unemployed among them—outnumbered a rival's.
One
recruit who'd waited overnight in the sub-freezing weather said that, without a
device in hand, the organizers wouldn't pay the $10 to $20 they'd promised the
recruits.
Some of
the growing in-line tensions, added the L.A. Times, were caused by fights
between the various groups of recruits.
Sales of
the iPhone 4S went according to plan, however, at Apple's other Beijing store,
where all 2,000 in-stock units sold out, according to the Wall
Street Cheat Sheet. It added that "a similar launch in Shanghai also
saw thousands lining up to buy the smartphone, and opened its doors an hour
early and sold out almost immediately."
The
situation at the flagship Beijing store appeared to impact Apple’s stock price,
which fell 0.5 percent, to $419.35, following the disturbance.
Enterprise Mobility News & Reviews 
