Didi Chuxing announced on May 13 that Apple has invested $1 billion in the Chinese car hailing company.
* Didi claims the investment will see Apple involved In both its technology and product strategies, but further details about this have been scarce.
IHS Technology Analysis:
For Apple, the investment in Didi highlights the strategic importance of China and the services segment for Apple's future strategy. The past quarter's results show that Apple's iPhone business is slowing and expansion in China had been one of its main growth drivers in recent years. As its hardware business has slowed, Apple has been keen to drive growth in its services revenues. This move shows how Apple is increasingly focused on services, such as Apple Pay, App Store, Apple Music, iTunes and iCloud.
Apple claims the deal will help further its understanding of the Chinese market, as well as providing a hoped for financial return on its investment. Despite Apple's strong presence in the Chinese market, Apple's investment in Didi highlights the need to work with Chinese players for Apple to strengthen its position in China. Working in partnership with local partners to enter new parts of the Chinese market is a common strategy for international companies looking to grow in China. As Didi operates across the Chinese market, not just on Apple devices, it could help Apple gain greater insight into the behaviour of users beyond its own ecosystem.
Apple's extends its existing Maps strategy into the transportation market
Taxi apps can also be a way into developing a wider automotive strategy and this investment is further evidence of Apple's interest in transportation, and perhaps the automotive market, beyond its current Apple Maps software.
IHS Technology's monitoring of investment and M&A activity in the mobile industry demonstrates Apple is not typically an investor in other companies. Usually Apple acquires companies outright.
Competitors such as Google--through its Google Venture arm--have been very active investors. Apple, however, tends to prefer fully acquiring companies and then integrating them into its existing product strategy or creating new products based on those deals. Apple's acquisition of Beats to launch Apple Music is the...