228: Chapter 228 Market Investigation: One Principle and Two Direct Approaches

Cook shook his head again.

Apple Inc. was in an even more miserable state in the European market; Motorola's distribution channels and Huawei's telecom connections made it difficult for them to make any progress.

And those connections had already allowed the mate series, transsion s2, and Motorola S2 to break Apple's myth as well.

Many European users commented that Transsion's signal was indeed stronger than Apple's, but precisely because of that, he didn't want to switch.

After all, once a switch was made, it meant Apple had lost.

Shen Fei looked at the expression on Cook's face and instantly guessed the little thoughts in his mind.

Was he going to pull out a "cheaper" plan directly?

"Mr. Tim, let's try a different approach."

Shen Fei pulled a document from his drawer; Cook was extremely interested throughout the process, his eyes fixed on Shen Fei's hands, never wavering.

"We will exclusively authorize Apple to use our communication baseband and allow you to develop your own communication baseband.

Apple Inc. can use our patents for free.

The patent fee will be 1.5 USD per year, plus a 3.5% commission on the total sales of the complete device."

Cook took the document and flipped through it.

These terms were indeed a bit more conscientious than before, and the market that was forced to be bound was now only the Chinese market. There was no specific year for unbinding, only one requirement: that Apple develop its own communication baseband.

There was no problem with the market binding; what Cook was most worried about was the commission.

A 3.5% commission: if Apple sold 200 million units a year at an average price of 600 USD, that would be 4.2 billion USD.

In other words, without doing anything, just by licensing some patents, Transsion would take away 4.2 billion USD.

He raised his head and looked at Shen Fei.

"Mr. Shen, don't you think this number is a bit absurd?"

"Absurd?" Shen Fei laughed, "What is your profit margin for selling Apple [products]?

At least 40%?

The 3.5% commission is less than one-tenth of your profit. Trading one-tenth of your profit for the freedom of a full-network baseband, I think it's very cost-effective."

"Besides, we aren't the only ones charging patent royalties. Compared to Qualcomm, ours is already very conscientious."

Cook fell silent.

He certainly knew that Transsion's plan was relatively conscientious, but this was just the first cut. Whether China Star would raise prices in the future after Apple invested large sums of capital into developing its own communication baseband remained a question.

He picked up the document and read it page by page.

The scope of patent authorization, commission ratio, authorization period, and breach of contract liability—every clause was written clearly. One look showed it had been drafted by a professional legal team.

At the same time, it also made him a bit worried; it seemed that Transsion had already guessed all the goals of their inspection this time.

He watched for a while, then put down the document and looked at Shen Fei.

"Can the annual 150 million authorization fee be reduced to a 2.5% ratio?"

"The authorization fee is 200 million, and the commission is 4%." Shen Fei did not give an inch.

The expression on Cook's face became difficult to maintain; why was there a reverse price increase?

"The authorization fee is 300 million, and the commission is 3%..." Cook took another step back; he still believed in Apple's sales volume...

But his concession did not receive a response from Shen Fei, who just sat there quietly sipping tea.

After about a few minutes, Cook finally couldn't hold his composure.

"Mr. Shen, you win."

As he spoke, Cook signed his name directly on the draft.

Shen Fei also reached out his hand: "Deal."

The two hands clasped together; this time Cook gripped even harder.

After all, this contract was a dull knife that would continuously cut flesh from Apple.

But he had no choice but to sign it.

With the foundation of cooperation established, the subsequent negotiations went much more smoothly.

Half an hour later, Transsion successfully became the battery supplier for Apple's next generation.

The restrictions on batteries were much fewer; during the initial launch period, except for the North American market, all high-capacity anti-freeze batteries would be supplied by Transsion.

After finishing the business, Cook declined Shen Fei's invitation to stay, as he still had other important matters to attend to.

The fan meetup still had to go through the motions.

Walking out of the building, Cook suddenly stopped and turned to look at Shen Fei beside him.

"Mr. Shen," Cook said, "I hope that next time, I can see you at an Apple launch event."

Shen Fei smiled.

"Mr. Tim, that day will come. Of course, the prerequisite is that the launch event must be in China."

Cook was stunned for a moment, but then immediately laughed.

"Hold a launch event in China?"

His face was full of smiles: "Perhaps?"

The car door closed, and the sedan slowly drove into the Transsion campus. His next stop was Beijing, where the China Unicom headquarters had already prepared a grand welcoming ceremony.

After all, China Unicom was the only operator to go all-in on Apple... Since the opening of mobile number portability, China Unicom's high-quality old customers had been poached quite a bit.

At the Ministry of Industry and Information Technology conference, Wang Jianzhou had scolded the other two companies quite a bit, but unfortunately, this was normal commercial behavior, and the leaders didn't need to say much.

They could only remind the other two companies not to go too far; everyone was one big family, and in case of future transfers...

But the other two companies didn't stop at all. Since war had been declared, they definitely had to determine a winner or loser. Only those without ability would go and complain.

...

Meanwhile, on the other side, when the plane Cook was taking landed at Beijing Airport, it was more than an hour earlier than the scheduled time.

It wasn't that the captain flew too fast, nor was it air traffic control; it was their own rescheduled itinerary.

The original itinerary was to fly directly from the United States to Beijing.

Cook didn't even need to think; China Unicom Chairman Wang Jianzhou must have arranged a grand welcoming ceremony, like red carpets, flowers, media reporters, the whole set was prepared...

Then, he would use him to promote Apple phones and increase Apple's sales.

But he was not satisfied with the business capability of the China Unicom team. He wanted to carefully inspect the team's ability without the leadership's guidance.

After all, not long ago, China Unicom had just requested an early renewal of the exclusive agency contract...

When getting off the plane, Cook dressed himself tightly, but the accompanying secretary said: "Mr. Cook, Wang Jianzhou over there..."

"Ignore him." Cook's voice was full of disdain, "Let's go see the Chinese consumers first..."

So 30 minutes later, when Wang Jianzhou rushed over with a bunch of executives and media reporters, a very awkward phenomenon occurred.

They waited until the flight attendants got off the plane, but they still didn't see the person they were waiting for.

In the end, they only got one piece of news: "Mr. Cook has arrived in Beijing and is currently on his way to the Apple flagship store in Xidan Joy City."

Wang Jianzhou's face changed several times.

"Quick!" Wang Jianzhou clearly didn't expect Apple to play outside the rules, so he shouted loudly, "Hurry to Xidan."

The media reporters behind him were also staring at each other, not knowing what had happened.

They just felt that the big event they were supposed to report on today seemed to be gone. Fortunately, many media outlets had anticipated this step, so they had sent multiple teams...