Apple CEO Tim Cook Visits China, Meets With Vice Premier

During a whirlwind trip to China last week, Apple CEO Tim Cook was feted much like a head of state.

He met with Chinese Vice Premier Ma Kai at the Zhongnanhai, an imperial garden in central Beijing where world powers such as former President George W. Bush have been entertained, according to Chinese news agency Xinhua.

As Apple prepares to expand in China, the meeting speaks to Cook’s clout there, experts on the country say.

“They took his visit very seriously,” said Anna Han, an associate professor at the University of Santa Clara who specializes in Chinese law. “To be received by the vice premier, it gives him status. Things like that matter in China.”

Cook touted the country’s importance to Apple and made the rounds in China, visiting a Foxconn factory where the company’s devices are assembled.

Cook said during an earnings call last week that Apple plans to expand its presence in the country from 15 retail stores to 40 over the next two years. During an interview with Xinhua last week, Cook said that Apple plans to bring all its products and services to China, starting with Apple Pay.

“We want to bring Apple Pay to China,” he told Xinhua. “I’m convinced there will be enough people that want to use it. It’s going to be successful.”

An Apple spokeswoman did not respond to a request to confirm the remarks. Apple Pay, which debuted in the U.S. last week, lets customers make in-app purchases and buy items in stores with a wave of their phones.

Cook’s visit coincided with reports that iCloud had been struck by an attack in China that could put usernames and passwords at risk. Cook and Ma’s conversation touched on privacy and security, among other topics, according to Xinhua. Cook told the news agency that the discussion was “very open” and “fascinating,” but declined to elaborate further.

Cooperation from the Chinese government would be instrumental to bringing Apple Pay to the nation, said Han, noting that many Chinese banks are government-owned. But Andy Tsay, a Santa Clara University business professor who has consulted for startups in Silicon Valley and China, noted that Apple’s offering would face stiff competition from Alipay, an online payments service launched by Chinese e-commerce tech giant Alibaba.

“In the Chinese market, the local Chinese company always seems to have an advantage, whether it’s because of government support or local customers being more willing to use it,” he said.

Han sees Apple Watch, which is targeted for an early 2015 debut, as a safer bet for success in China. The cover of the November issue of a Chinese magazine features someone sporting the gadget.

“I think it’s something that will become a status symbol,” she said.

Cook was in good company in China last week, with Facebook CEO Mark Zuckerberg also making the pilgrimage from the Valley. But Zuckerberg took a different approach, delighting students at Tsinghua University with remarks in Mandarin. Facebook is currently banned in China.

“Apple’s trying to expand, and Zuckerberg’s trying to get in,” Han said.

This article appeared in print in the October 27th, 2014 edition of Hamodia.