iLounge

The Chinese market represents a large opportunity, and perhaps an equally large challenge, for iPhone app developers, according to a Wall Street Journal report. While the country is said to have roughly two million iPhone users, the vast majority of those are jailbroken units, and are therefore more likely to hold pirate applications. In addition, official China Unicom iPhones lack Wi-Fi, removing a key capability for some applications, and many App Store offerings are in English, with prices in U.S. dollars. Even so, companies are racing to become the top apps in China. “We know perfectly well that Chinese market is huge and has great potential. But when we release apps targeting users here, we’re usually not able to get reasonable returns because of piracy,” said Shi Weixing, CEO of Chinese mobile application company 9thQ.

Shi estimates that about $1 million of legitimate apps have been sold in China so far this year, though the number could rise to $6 million in 2010. By comparison, AdMob estimates about $200 million in apps are sold through the App Store each month. Payment methods also pose a barrier to growth, as the App Store requires a credit card issued by a Chinese bank, something not commonplace, said Frank Yu, COO of Beijing-based app designer Shouji Mobile. “Once Wifi is allowed on future 3G iPhones and the price of handsets falls due to product life cycle, more subsidies or economies of scale, we will see the iPhone market in China go mainstream,” Yu said.