iPhone 5 release: In China, gray market pre-orders available now

Don't get too excited but it looks like the Apple [AAPL] iPhone 5 (or is it iPhone 7*) release is closing in, as China's thriving gray market importers have begun offering the new phone for pre-release sale as the company prepares for the "biggest consumer electronics launch in history".

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[ABOVE: Some enterprising sellers are even offering little hints about the iPhone 5, such as the image above which purports to show the difference between a 3.5-inch and a 4-inch display.]

Buying on rumor

Logically it might make little sense, but reports this morning claim some Chinese online retailers have already begun offering the unannounced, unconfirmed and unrevealed smartphone for pre-release sale -- and orders are coming in.

Reuters tells us Chinese ecommerce website, Taobao is already hosting listings from jump-the-gun sellers, some of whom are even publishing mock-ups of what the new phone will look like, alongside lists detailing some of the claimed features (biometric recognition systems, anyone?).

Sellers are requesting deposits to secure the first units of the iPhone to be smuggled into the country of up to $1,100. They plan to purchase the device in Hong Kong or the US and then import them into China -- and it seems some people are already stumping up the cash to secure the freshly smuggled devices when the product ships, perhaps as soon as late September.

In a sense this is a fitting tribute to many months of furious iPhone 5 speculation. We've seen mock-ups, claimed images of parts of the device, and, most recently, claimed engineering pre-production mock-ups of the phone.

China is Apple crazy

China's market for iPhone imports is interesting. Partly that's because iPhones are presently manufactured in China; partly because the country is crazy for Apple devices. One Chinese teenager even sold a body part in order to raise the cash to get one. Sweating blood to get what you want is a noble thing, of course, but selling body parts seems a step too far, though it clearly reflects the mood in China where mini riots took place when Apple shut its retail store for iPhone 4S sales.

Demand for smuggled iPhones means the country's biggest carrier, China Mobile, already has over a million of the devices on its network -- even though it doesn't (yet) offer iPhones officially. It is expected to introduce the iPhone 5 later this year, when millions of Chinese nationals will doubtless purchase the officially supported version of the device.

The gray imports market also means Apple stores worldwide often see queues of folk waiting patiently in line when they open in the morning. These customers purchase their allotted maximum number of iPhones and send them back to China for resale in exchange for a fee.

Feature rumor 101

When it comes to the iPhone 5, what are people looking forward too?

  • A 4-inch display
  • An improved quad-core processor, likely manufactured using 32nm process tech
  • Improved graphics and a better camera
  • A new Dock connection, likely to be Thunderbolt or mini-USB
  • Tougher glass
  • A thinner chassis
  • International support for those 4G/LTE networks which exist
  • Much-improved iCloud integration
  • iOS 6: Many improvements in Siri
  • iOS 6: Apple Maps
  • iOS 6: Passbook, potentially though not necessarily featuring NFC payment support
  • iOS 6: Facebook and Twitter integration

Apple is putting a lot of hope into its new device. Not only is the company facing the imminent arrival of Microsoft Windows 8-powered smartphones, but it continues to face stiff competition from Android-powered devices (in particular those from Samsung). RIM, Palm and Nokia now appear to be spent forces in this sector.

The stiff competition is creating a challenging environment for the firm. More than this, economic weakness means many consumers are now opting to delay their iPhone purchases pending arrival of the new model. Mizuho Securities analyst Abhey Lamba claims Apple has: “Already started experiencing a slowdown due to the impending iPhone 5 launch.

The analyst remains optimistic for Apple once the new smartphone ships, as well he might given Foxconn leader Terry Gou's somewhat belligerent statement that the iPhone 5 will "put Samsung's Galaxy III to shame" when it ships. That's fighting talk.

The moral of this tale? If you really want to get hold of an iPhone 5 and don't mind waiting for it to arrive, you can place your orders now if you happen to be in China.

* The new iPhone is the seventh generation of the device. The family has so far included: iPhone, iPhone 3, iPhone 3G, iPhone 4, Verizon iPhone and iPhone 4S. If you count them this means the iPhone 5 -- which some expect to be called simply "the new iPhone" will in essence be the seventh iteration of the device, (iPhone 7), though some might argue the Verizon iPhone 4 version doesn't count.

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Also read:

Apple's iPhone 5 with global 4G heads to world's biggest carrier, China Mobile

WWDC 2012: Apple iPhone 5 details, Retina Display Macs

WWDC 2012: Apple's iPhone and the iRobot supply chain

Will iPhone 5 boast removeable lenses? No, but it might fix Apple Maps

WWDC 2012: Facebook integration, Apple Maps for Fall's iOS 6

iPhone 5 release: Apple's September launch, what to expect

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