News

China's Cellular Subscription Ban and its Impact on Apple Watch Series 3

James L. Flint

• August 21, 2023

Introduction

The latest iteration of the Apple Watch, Series 3, was unveiled with great anticipation due to its cellular capability, allowing users to enjoy its features even without their smartphones. However, a recent development in China has significantly affected the functionality of this feature, making the new watch lose its primary advantage.

China's Ban on Cellular Subscriptions

China Unicom, the sole carrier that initially supported the cellular-enabled Apple Watch 3, had allowed cellular subscriptions for a few days. However, starting from late September 28, new subscriptions for cellular plans have been halted across the country, according to the Wall Street Journal.

The Journal speculates that China's concern lies in the security of the Apple Watch 3, as it relies on an eSIM provided by Apple, unlike phones that use SIM cards issued by wireless carriers. The eSIM system raises questions about how carriers and regulators can track the identity of device users. Chinese wireless companies hold more control over SIM cards, which require customers to register their real names, compared to eSIMs provided by Apple.

Issues Surrounding the Apple Watch 3

The introduction of the cellular Apple Watch 3 has not been without its challenges. Early reviews highlighted connectivity issues, but Apple promptly addressed these problems through a software patch. While this was a minor setback for Apple, it pales in comparison to the potential production issues rumored to affect the upcoming iPhone X.

Conclusion

The ban on cellular subscriptions in China has significantly impacted the functionality and overall value proposition of the Apple Watch Series 3. With shares experiencing a 2.4% drop in Thursday trading, Apple will have to navigate through this obstacle and potentially face further challenges with the iPhone X production.