China's ban on Apple's iPhone accelerates- Bloomberg

More Chinese agencies and government-backed firms across the country have ordered staff to stop bringing iPhones and other foreign devices to work, setting in motion an unprecedented prohibition that’s likely to block Apple Inc. and Samsung Electronics Co. from parts of the world’s biggest mobile market, Report informs via Bloomberg.

Multiple state firms and government departments across at least eight provinces — including the prosperous coast — instructed employees in the past month or two to start carrying local brands, according to people familiar with the matter. That’s a major step-up from around September, when a small number of agencies in Beijing and Tianjin began telling staff to leave foreign devices at home, said the people, who asked not to be identified discussing confidential orders.

The much broader, coordinated effort marks a dramatic quickening of Beijing’s campaign to wean itself off American technology, coinciding with the resurgent popularity of homegrown brand Huawei Technologies Co. Xi Jinping’s administration this year decided to expand a ban on foreign devices beyond the most sensitive departments — a directive that had been in place for years — to encompass many more government agencies and even state firms, Bloomberg News reported in September.

Apple shares dipped to a session low after Bloomberg reported on the widening bans. The stock fell less than 1% to $197.57 at the close Friday in New York and then declined further in after-hours trading. Apple had reached a record high earlier in the week.

While Chinese software and hardware have gradually replaced American products over the years — from Microsoft Corp. software to Dell computers and Intel Corp. chips — the edict threatens to deal a swift and direct hit to Apple’s market share.

This month, smaller firms and agencies in lower-tier cities have issued their own verbal directives, suggesting a much broader movement is kicking in, the people said. The orders originated from cities across at least eight provinces from prosperous Zhejiang, Guangdong, Jiangsu and Anhui to northern Shanxi, Shandong, Liaoning and central Hebei — home to the world’s largest iPhone factory.

The Chinese government has previously pushed back on reports about iPhone restrictions, while also raising concerns about the security of the device. “China has not issued laws and regulations to ban the purchase of Apple or foreign brands’ phones,” Foreign Ministry spokeswoman Mao Ning said during a press briefing in September.

It’s unclear how many government agencies precisely have issued directives, nor how widespread they’ve been. Different organizations will likely vary in how zealously they enforce internal edicts, with some forbidding Apple devices from the workplace and others barring their use entirely.

Collectively however, they present a major challenge for Samsung and Apple, which are both struggling to sustain growth in a key market. For Apple, which also uses China to produce the majority of its devices, the country yields about a fifth of its revenue.