Trump banned WeChat, Apple’s $ 44 billion pie was threatened

IPhone devotees in China are looking at the possibility of sticking to Apple devices after US President Donald Trump issued an executive order banning Chinese apps including WeChat, the super app. indispensable for the people of this country.

It is expected that the Trump ban will take effect in about 5 weeks from being announced. However, Kenny Ou, a resident of Hong Kong, China, stressed that the ban could turn iPhones into “expensive electronic waste”. WeChat is considered one of the most essential software on a handset in China.

On August 12, the CEO of Tencent said that they did not believe the ban would only apply to WeChat in the US and not affect its brother known as Weixin. The Tencent side announced that they are still waiting for clarification in US regulations and open the possibility of it affecting the world’s largest company by market capitalization.

Apples have just had a good quarter in China, its most important international market. It is here that Apple is also facing increasing competition from local Android rivals such as Huawei Technologies Co. Without WeChat, the attractiveness of Apple products in China would plummet.

In fact, Tencent’s WeChat connects 1 billion users worldwide. It is considered a super app that can do everything from chatting with friends to buying movie tickets, train tickets, paying bills…. While President Trump’s ban remains largely unclear, the threat of cutting off a vital communication link between China and the rest of the world will hinder American companies like Starbucks Corp and WalMart Inc. Access to users in the world’s 2nd largest economy.

If Apple were forced to remove WeChat from its app store on a global scale, its annual iPhone shipments would drop 25-30% while other devices AirPods, iPads, Apple Watch, and Mac computers, 15% -25% reduction. Currently, Apple has not immediately commented on this matter.

In a survey conducted on Weibo, a Chinese-like version of Twitter, 95% of the 1.2 million responded to it that they would give up the iPhone if forced to choose between it and WeChat.

“The ban will force many people to switch from Apple devices to other products because WeChat is really important to our lives. Our families in mainland China are familiar with WeChat and all of our communications. All of my hits are on the platform, “said Sky Ding, who works in the fintech sector in Hong Kong.

First launched in China in 2009, the iPhone has sold 210 million units in the past five years. According to research by QuestMobile, a fifth of smartphone users in China are using an iPhone, only after Huawei’s 26% market share. Apple has 42 stores in China and this is where iPhone production is exported to the world.

At its peak, mainland China accounted for 25% of Apple’s revenue despite falling 17% in the last fiscal year. Sales in this region have risen to $ 43.7 billion.