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The iPhone 5 has become relatively less stale in the total mobile phone market compared to what the iPhone 4/4S became. The current model of the phone can still
by kyro 13y ago
The iPhone 5 has become relatively less stale in the total mobile phone market compared to what the iPhone 4/4S became. The current model of the phone can still compete, it's good enough. Apple recognizes this, but also knows that it needs to innovate to keep its early adopters happy. And so they split their product to tailor to these two market segments -- those who need innovation, and those who would be perfectly happy with the current specs. These two market segments do not differ greatly in their purchasing power. Splitting the product wasn't to create a mid-tier and high-tier phone for the respective price points. It was a targeted refresh of the product for two equally valuable market segments.
I suspect that as the mobile phone landscape changes, the iPhone 5C will begin feeling more obsolete, and it will then be relegated to the level of n-1 offering, and all attention will then go to the iPhone 6, which should presumably be a huge leap in innovation and design.
- derefr 13y agoTo me, what this looks like is a final submission by Apple to the economics of their own supply-chain. Apple has never been able to make enough iPhones of each successive generation for people to get their hands on during the first few months after release. Whereas, once they've ramped up production, they tend to have all these parts left over in the pipeline[1] that they have to sell off as N-1 gen hardware to price-sensitive late adopters. (This is also why the iPod Touch was originally created, to serve as a sink for N-2-gen parts.) Now, Apple are trying to shift the purchase frenzy to the N-1 gen, and position their new gen-N tech -- whose production hasn't yet been ramped up -- as something for early-adopters only. In other words, to switch from an (N-1, N) view of the world, to an (N, N+1) view. Everything in the S will filter down to the C of the next gen. They'll get their pipelines saturated with 5S parts just in time to wrap them in plastic and call them 6C parts. As long as more people buy Cs than Ss, this works out perfectly. --- [1] By "in the pipeline", I mean the more general "economically incentivized to produce units of, instead of units of the new model, by contractual obligations to factories, training costs of factory workers, etc." Apple actually keeps their literal pipeline of hardware-produced-but-not-yet-shipped-as-a-product quite low.
- kyro 13y agoThat's interesting. Do you have any links to read more about their supply chain and the origins of the iPod Touch?
- smackfu 13y agoThey could have really committed to this strategy by not having the $199 iPhone 5s model. I guess that was a step too far.
- badman_ting 13y agoHadn't thought of that, but wow does it make sense. Interesting analysis, thanks.
- malyk 13y agoI like this take. Makes pretty good sense to me. The one quibble I would have is that I'm not sure that all of the new tech will filter down in the next generation. That's the way they've done it before, but it could be that they change that after the split. I'm thinking of the fingerprint scanner mostly. I could see that remaining a premium option for a few years. We'll have to wait until next september to find out for sure though.
- smackfu 13y ago> The current model of the phone can still compete, it's good enough. Screen sizing is the only place the iPhone might show weakness. Apple is holding the line on smaller phones... we'll see if it continues to work out for them.
- superuser2 13y agoI think there will continue to be a market for phones that can comfortably fit in ordinary-sized pockets. The S4 is enormous - useful when it's out, but a pain to pull out and check.