China Unicom plans cut-price iPhones as China Telecom prepares to enter the iFray

Big news from China where Apple’s current carrier China Unicom says it hopes to reduce iPhone prices there – even as far bigger rival, China Telecom, confirms continued talks to distribute the Apple device in the country.

China Mobile Ltd. Chairman Wang Jianzhou said Friday that his company and Apple have been in talks on an iPhone distribution deal

For China it looks like a price war may be ahead (probably easier to achieve when you consider the devices are actually manufactured there) “For Chinese consumers, the sales price for iPhone should be the-cheaper-the-better, and we totally understand that,” said Chang Xiaobing, China Unicome chairman at the opening of the annual National People’s Congress in Beijing on Friday.

Chang’s remark marries well with earlier claims the carrier intends reducing iPhone prices by 20-30 percent at the end of the Month, with the Beijing Morning News citing claims from Merrill Lynch that Unicom may lower the iPhone price to 3,000 yuan ($439.46) to 3,500 yuan from the current 4,999 yuan to 6,999 yuan.

That’s a good price when you consider part of the reason for slow iPhone sales in China has been the strength of the grey market. Unlocked grey import iPhones (with WiFi) cost around 5,700 yuan ($835) in China’s street markets.

Chang confirmed over 300,000 iPhone sales in China since launch, adding the it continues to discuss the possibility of introducing a WIFi-enabled phone there in future.

China Unicom was reportedly contracted to buy five million iPhones at a cost of $1.5 billion.

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