（CEO of Xiaomi, Lei Jun）

Japanese Economy News publishes an essay that iphone is experiencing setbacks in China now.

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IPhone is one of the most popular smart phones in the world right now. But iPhone faces setbacks in emerging markets recently. The sales of iPhone in China decrease 14% in the last three months from April to June. Though the demands of smart phone in emerging market are increasing, "iPhone profits model", which relies on high profit rate markets, is facing discomfiture.

In the Apple Finance Report Conference on July 23th, Tim Cook was asked about the downturn in China's market. He answeres that there is still a huge commercial space in China and they will not give up just because a 90-day downturn.

The total profit of Apple is 6.9 billion dollar in Q3. The profit rate is still high even though it decreases 22% compared to the same period in last year. Apple is famous for its high price smart phones and tablets. When they publish new products, they will decrease the price of old models but still keep profits. In this case, apple has gained huge profits.

In emerging market such as China, Apple expects to use the same way to gain profits but failed.

First of all, the average unit price in emerging market is decreasing. According to Tim Cook, though apple published iPhone5 in the fall of 2012, iPhone4 is still the first choice for Chinese.

Secondly, the most popular smartphone in China is not iPhone but Xiaomi right now. The price of Xiaomi is just one third of iPhone.

Except for Xiaomi, Huawei Tech published some low price smartphones with an average price of $260 and Lenovo published a smartphone for $130. From the statistics data, the share of iPhone in China's market is 6.4% and ranks the sixth. Samsung ranks the first with 17.3%.

We can see from the smartphone market around the world that the demands in emerging market are expanding. As the increasing rate of smartphones is 30% around the world, the increasing rate of iPhones is 20%.