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Company in focus

Apple held hostage by its Chinese puzzle

How iPhone maker's success manufactured the rise of Huawei

CHENG TING-FANG and LAULY LI, Nikkei staff writers | China

TAIPEI/ HONG KONG -- Soon after Tim Cook was hired by Apple's founder Steve Jobs in 1998 to whip the company's U.S.-focused supply chain into shape, he made a bold decision. Within two years he began shutting Apple's U.S. factories and outsourcing production to China.

His decision drove down costs and gave Apple the resources it needed to develop its next blockbuster products, the iPod and iPhone. It also created a competitive manufacturing base, capable of mobilizing hundreds of thousands of workers with just a phone call.

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