Commentator: Apple's China Centers Go Beyond R&D

Since Donald Trump began his presidency in January 2017, the US has begun addressing its immigration policy, making it more difficult for Silicon Valley giants to draw international talent to the country. By setting up R&D centers globally, Wang argued, Apple could recruit local talent and develop local markets. 

　

Moreover, Internet-related innovations by China - like the Mini Programs feature launched by WeChat that reduces the need to install applications on mobile devices - could pose a challenge to Apple’s ecosystem; and while sales of devices are seeing slow growth, the company’s software revenue in China is surging. 

Setting up R&D centers in China is one way to help expand its iOS ecosystem in China and improve innovation abilities to increase software revenue, according to the commentator.

 　

An R&D center is more than just a research center, argued Wang. In China’s smartphone market, Apple falls significantly behind its local rivals in terms of offline marketing channels and marketing strategies. With such bases, the company can recruit local sales talent and build a localized marketing system. 

　

The technology giant, according to Wang, badly needs to strengthen ties with its Chinese suppliers, especially as local smartphone brands’ efforts to build their own supply chains threaten its dominant position.　

Equally important is that Apple needs to establish a local team that understands Chinese consumers better. For example, the Apple R&D Center in Shenzhen has five divisions - supply chain management, marketing and operation, R&D, online and offline retailing. Apple needs to set up various R&D centers in the country to draw more talent to advance this strategy.