????Morgan Stanley has seen the future and it's a well-heeled Chinese man (or woman) with an iPhone.
????In a note to clients Sunday, Katy Huberty drew on Morgan Stanley's proprietary AlphaWise survey of buying patterns among China's rapidly growing middle class to paint a picture of the smartphone market on the mainland after Apple (AAPL), as widely expected, finally signs deals with China Mobile (CHL) and China Telecom (CHA).
????She assumes:
????? That there are roughly 150 million high-end subscribers in China currently paying at least RMB 100 ($16) per month for mobile phone service.
????? That China Unicom (CHU), currently Apple's only official carrier, has 15 million of those subscribers, or roughly 10%.
????? That late this year or early next, Apple will begin selling next-generation iPhones through China Mobile (120 million high-end subscribers) and China Telecom (15 million).
????? That because 20% of China Unicom's high-end subscribers buy iPhones, the other two carriers' subscribers will follow suit. (8% China Mobile's high-end customers already use iPhones, even though they get only 2G service.)
????? Assuming 20% penetration, Apple should see, at a minimum, 24 million addition iPhone sales in 2013, adding $6.5o per share to the company's bottom line.
????? As the iPhone catches on and the middle class expands, that number could grow to nearly 40 million next year, adding $10 to Apple's earnings per share.