The iPhone 6 Is Hitting the Black Market

While I’m still debating whether or not to shell out the money for the new iPhone 6 as my iPhone 4 (yes, you read that right) is on its last legs, people are paying up to 10 times the US price for the iPhone 6 on the Chinese black market. The latest update seems as lackluster as its sales report, so what’s driving the black market demand for the iPhone 6 in China?

Well, it’s the fact that the iPhone 6 isn’t yet available in China legally right now. So far, the iPhone 6 has passed only two of China’s three regulations. It still needs to obtain a key network access license before it can enter China’s market, and it’s not clear when that will happen. This delay with iPhone 6 release in China has created a profitable opportunity for black market smugglers in China who are reselling the iPhone 6 to Chinese citizens eager to get their hands on the new releases. These smugglers are suspected to be using connections in Hong Kong, Australia, and the US to bring iPhone 6’s into mainland China.

Last September, Casey Neistat, a film director and producer, created a short film about the iPhone 5s debut, capturing the excitement and hysteria of launch day (toward the end it was like watching a pep rally for a phone). He also captured a few moments of what might have been a glimpse at the US end of the Chinese black market, so this year, Neistat went to the iPhone 6 launch in New York for a better look.

In Neistat’s own words:

“For the 2013 launch of the iPhone 5s I made a short video about the lines in NYC, most of the video was of enthusiastic Apple fans, not unlike myself, eagerly waiting to get their hands on the new iPhone. There was also a percentage of line sitters that lacked all enthusiasm, one in particular was asleep with her head inside of a garbage bag. Those images bothered me, they were also the most talked about aspect of that 4 minute video. For this year's iPhone 6 launch my intention was to cover that aspect of the story - sitters there for reasons other than their enthusiasm for the product.”

The ratio of iPhone enthusiasts to iPhone resellers in the New York launch lines is unclear, and even though he has a Mandarin interpreter, none of the Chinese people at the focus of Neistat’s film state that they plan to resell. However, Neistat does manage to capture a few handoffs and transactions as iPhones and cash (always cash) changes hands inside and outside the Apple Store.

Neistat’s iPhone 6 film ends with an angry unidentified man yelling at a police officer that “everyone knows” what's going on and that this is terrible marketing for Apple.

“I don’t think this kind of business is good for anyone,” Neistat concludes.