Linked by Thom Holwerda on Wed 25th Sep 2013 10:38 UTC
Apple

I've been thinking a bit more about those iPhone 5C/5S weekend sales figures, and while it is certainly impressive, if you compare it to the iPhone 5's first weekend sales figures, it's actually quite a step backwards for Apple. The issue here - something many sites and even Apple itself doesn't want to focus on - is that the iPhone 5C/5S is available to a lot more people than the iPhone 5 was.

The iPhone 5 was available to 720 million people at launch, and sold 5 million units. This is a penetration of 0.69%. The iPhone 5C and 5S, however, are available to 2078 million people, and sold 9 million units, which constitutes a penetration of 0.43%. So, Apple has two new models to advertise and lure consumers with instead of one, and has a huge additional market (China) to address, yet it failed to capitalise on either of these two factors.

What this shows is that while the sales figure is still pretty darn impressive, it's not nearly as groundbreaking if you put it in perspective. Looking at it this way, the so-called record breaking 9 million figure can easily be explained away by Apple almost tripling its launch weekend audience, instead of an increasing popularity of the iPhone.

The only reason I'm writing this is to illustrate how numbers are entirely arbitrary, and it's easy to make silly comparisons and claim an arbitrary victory - or, change perspective a bit and claim arbitrary defeat, as I've done here.

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RE[2]: Comment by majipoor
by Tony Swash on Wed 25th Sep 2013 22:18 UTC in reply to "RE: Comment by majipoor"
Tony Swash
Member since:
2009-08-22

"Android and iOS are not aimed at the same customers


This is nonsense. The best selling Android handsets target very much the same market as the iPhone does.
"

I am going to link to another piece by Ben Thomson called "The $550 iPhone 5C makes perfect sense" which is a very preceptive and interesting dissection of the phone market and how and why Apple targets certain market segments.

http://stratechery.com/2013/the-550-iphone-5c-makes-perfect-sense/

Excerpt from summary (but read the whole thing - it's very illuminating).

[q}
To summarize, Apple’s decisions with the 5C are completely rational.

Apple believe the iPhone 5 is the standard for “good enough” and won’t produce a “new” iPhone below that level. That means higher prices this year.

Apple’s “best” markets are the American-style ones, for reasons beyond simply subsidies. Thus, it makes sense for them to optimize pricing for those markets – i.e. $550/$99.

Expanding a product line is best done incrementally to ensure you are not leaving money on the table. You can’t have a high-end and low-end with nothing in the middle.

There are two risks in this approach, both having to do with apps. The first is losing the “new and shiny” app advantage. Incremental change will only slightly slow Android’s expansion, and while much of that expansion has low engagement, low engagement/user x many more users still equals more total engagement. Were, based on this equation, new apps and features to start coming to Android first, Apple would lose a major differentiator.

However, I think this risk is a small one. The 5C will solidify Apple’s hold on the United States, where just under 50% of app developers live. Moreover, the 5C is focused on those blue pie slices – the Android users who are driving engagement. [/q]

Reply Parent Score: 1

RE[3]: Comment by majipoor
by galvanash on Thu 26th Sep 2013 01:08 in reply to "RE[2]: Comment by majipoor"
galvanash Member since:
2006-01-25

I agree with that analysis to be honest, but Apple still hasn't introduced the product the market thought the 5C was going to be - a phone that will sell in unsubsidized markets in volume.

Maybe they never will. They certainly don't have to - but eventually the shear inertia of all of the cheaper phones will catch up with them...

I hope they try at some point - but personally I don't want to see a "cheap" iPhone - Id rather see something totally different - a really good feature phone, something like the ipod nano in phone form. No app store, just a really solid phone/music player with some good useful built in apps optimized for what would have to be much lower end internals. Small but good screen with excellent build quality.

That would be somewhat radical, and it won't win in comparisons with Android devices on the features, but I think there is a market for "just a good phone" at say $199 no contract if it were extremely small and pocketable.

I think the components to build such a thing are all there and the price is doable - its just a matter of the battery, they have to get about 2x better than they are now to make it work most likely.

Anyway, just a though. Doubt they would go this route - there is too much momentum tied up in the app economy.

Reply Parent Score: 2

RE[4]: Comment by majipoor
by MOS6510 on Thu 26th Sep 2013 06:46 in reply to "RE[3]: Comment by majipoor"
MOS6510 Member since:
2011-05-12

I don't think a cheap phone would make much business sense for Apple.

A normal iPhone makes them money per sale, but also after that when users buy apps, books, music, etc...

When Apple markets a cheap phone to poor countries the phone won't make them much money. If it won't run all the apps they can't sell those and the people would probably not spend much anyway.

So it takes a lot of effort, while it won't make them much and gives them another product to support.

I do think a cheap iPhone or Apple phone would sell a lot in less rich countries.

Reply Parent Score: 2

RE[4]: Comment by majipoor
by unclefester on Thu 26th Sep 2013 09:11 in reply to "RE[3]: Comment by majipoor"
unclefester Member since:
2007-01-13

I hope they try at some point - but personally I don't want to see a "cheap" iPhone - Id rather see something totally different - a really good feature phone, something like the ipod nano in phone form. No app store, just a really solid phone/music player with some good useful built in apps optimized for what would have to be much lower end internals. Small but good screen with excellent build quality.

That would be somewhat radical, and it won't win in comparisons with Android devices on the features, but I think there is a market for "just a good phone" at say $199 no contract if it were extremely small and pocketable.


They're called Nokias and sell for as little as $30 unlocked.

Reply Parent Score: 3