Every year during the month of September there is
a section of consumers across the world that wait for one particular
announcement – this announcement has nothing to do with appraisals, increments,
trade fairs, holidays or festivals. The ‘defining’ event is, in fact, the annual
announcement of a new version of Apple’s iPhone, the 2013 versions of which were
announced yesterday in the US.
Like any Apple launch, the anticipation and
speculations had started months ago and a lot of leaks of possible
specifications of the iPhone were already doing the rounds on the Internet.
Since Apple has always been admired for keeping the best features secret, the
excitement amongst consumers did not witness a drop despite the many leaks and
specifications of the new iPhone models. Unfortunately, this time Apple couldn’t
withhold too many secrets and to the dismay of many consumers the leaked
specifications and predictions were almost on target. The Apple new launch
presentation, which was known to keep audiences glued and invited analyst
comments even on the last “Thank you” slide during the days of the legendary
Steve Jobs, this year lasted only 20 minutes and did not provide much meat to
mediapersons and tech industry watchers.
Apple announced the iPhone 5s and iPhone 5c
models in the US on September 10. For the first time since 2007, Apple plans to
launch multiple variants of its flagship smartphone. The 5c comes in multiple
colours with a plastic body (green, yellow, blue, white and pink), 4-inch retina
display, 8MP camera, the older A6 processor at an open market price of US$ 549
for the 16GB version, US$ 649 for the 32GB version and contract pricing of US$
99 and US$ 199 for the 16 GB and 32 GB versions, respectively. On the other
hand, the iPhone 5s has modifications which are focused on internal software and
phone capabilities rather than external look and feel (except for 3 new colours
– gold, ‘space grey’ and aluminum white). Some of the new features found on the
iPhone 5s are – the new generation iOS7, the A7 chip with 64-bit architecture (a
first ever for Apple), M7 motion co-processor (for detecting movement and saving
battery), Touch ID (fingerprint identity sensor built into the home button), New
iSight camera with dual LED flash, support for more LTE bands, and a new
Facetime HD front facing camera.
I present below my brief analysis on the two
models of iPhone announced by Apple:
iPhone 5c: ‘C’ stands for “cheap”, “cut
down”, “colour” or “China”?!
Although Apple has made it clear the new iPhone
5C is a colorful version of the earlier model iPhone 5 without many software
changes, this is the smartphone through which Apple will target emerging markets
like China, India, Brazil, African continent and other countries, positioning it
as a more affordable (cheaper?), colourful, cut-down version of the flagship
model. With Apple’s recent deal with China Mobile (operator with the largest
subscriber base in the world); it won’t be inappropriate to employ all of the
above adjectives for the iPhone 5c. But, with an open market price of US$ 550 in
the US and Yuan 4,488 (INR 46,500) in China, I have serious doubts that it will
win over non-Apple mid-level segment smartphone users for the vendor.
The below table presents my understanding of the
emerging countries where Apple will focus with the iPhone 5c:
From the above brief analysis of average selling
price (ASP) of smartphones in emerging markets, I don’t think the iPhone 5c will
be able to win over new customers in these geographies with a model that boasts
multiple colours as a USP. It is in fact a trimmed-down version of the older
model launched a year back at a price per unit which is almost two times. Apart
from pricing, other specifications such as screen size will go against Apple, as
people in emerging markets have shown a strong preference for the bigger screen
size ‘phablet’ devices (5” to 7”) in the last few quarters. The entry level
Android OS-based smartphone models in these emerging markets will easily beat
the Apple 5c, with its current specs. Hence, I feel the launch of a new model
like the iPhone 5c does not really serve any clear purpose.
Even if one examines the operator bundling
scenario of the iPhone 5c in emerging markets, the picture is bleak – India
remains an open market, while in Russia three major operators (MTS, Vimplecom,
Megafon) have cut ties with Apple. In Latin America too the bundling market
doesn’t reflect a good scenario for Apple either. So, all hopes for the Apple
iPhone 5c lie on its association with China Mobile; here, players like Xiaomi,
Lenovo and ZTE will threaten its position.
iPhone 5s: ‘S’ stands for
“same”?!
iPhone 5s launched along with the iPhone 5c was
definitely an improved version from the earlier iPhone 5, but the improvements
were mainly at the software level, rather than the hardware, many of these
having been leaked months ago. Even the price and screen size have been kept the
same levels as for the iPhone 5.
While it is true that the iPhone 5s boasts of a
faster, new generation CPU, better GPU, enhanced battery life, better camera
etc., consumers have come to expect such changes as routine, while evaluating
the need to upgrade to a new smartphone from any vendor. The only new technology
on the iPhone 5s is Touch ID, which comes from Apple’s acquisition of Authentec
for US$ 356 million, and is not an innovation from Apple’s own in-house stable.
So the key question that begs an answer is where is the innovation for which
Apple has always been known?
For me the most innovative smartphone from Apple
still remains the iPhone 4s; devices launched after that have seen only cosmetic
changes. So, does it actually require a year to launch a model which is only a
moderate improvement over the previous version? I don’t think so. Apple can
certainly do much better.
Source:CMR, By Tarun Pathak, Assistant Manager,
Telecoms
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