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Apple granted China Mobile license, but no deal yet

Matt Clinch; Reporting by Eunice Yoon and Bo Gu
Wednesday, 11 Sep 2013 | 2:11 AM ET
Will the Chinese buy Apple's new iPhone?
Eunice Yoon tells CNBC that the Chinese government has granted a license to Apple to use the China mobile wireless standard in their new 5S and 5C.

Apple may have failed to wow investors at its new device launch on Tuesday with disappointment over the pricing of its iPhone 5C, but a new document shows that the U.S tech giant has been granted a license for the phones to run on the largest of China's mobile networks.

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The license - uploaded to a subsidiary of the Ministry of Industry and Information Technology's website - shows that Apple now has access to China Mobile's wireless mobile standard for its new iPhone 5C and 5S. The permit was issued on August 30 and expires on February 28, 2014. The license gives Apple the use of its 4G TD-LTE network, its 3G TD-SCDMA network and also its GSM network.

The news comes after a launch event in Beijing, which like a similar launch event in the U.S., left investors largely underwhelmed. Apple was expected to announce a partnership with China Mobile, the world's largest mobile carrier by subscribers with 750 million subscribers. The tie-up was not announced but this latest news adds weight to possibility of a partnership further down the road, thus opening up a massive new market in China for Apple. The short time frame of the license could also fuel rumors that Apple will be releasing its phones on the network on a trial or temporary basis.

Apple's shares fell by over 5 percent in morning trading on Wednesday.

China Mobile declined to comment on the license granted for Apple but a spokesperson told CNBC that the company is in the "process of negotiating with Apple".

(Read More: Apple's new iPhone 5C may be priced just right)

Apple has been losing its foothold in China owing to fierce competition from rival Samsung and local manufacturers. The company's sales in Greater China, which includes Taiwan and Hong Kong, plunged 43 percent on quarter in the April-June period.

Disappointment over the pricing of the iPhone 5C is weighing on shares and has led to its suppliers also posting gains on Wednesday. Investors have voiced fears that the price tag is too high and may limit sales in key emerging markets.

(Read More: Apple supplier shares slump on iPhone 5C pricing)

According to Apple's China website, the phone would be sold at 4,888 yuan ($733). In the U.S., the phone is priced at $549 without a contract, and $99 with a two-year contract. Analysts had expected an unsubsidized price of $350-400.

By CNBC.com's Matt Clinch. Follow him on Twitter @mattclinch81.

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