Half of the year has passed, and the smartphone wars continue to rage. While we anxiously speculate on how the three new, affordable Nokia S40 mobile phones are going to affect the global electronics market, Apple might surprise us with a smaller, more affordable iPhone to heat up the battle for market share.
In February 2011 Apple was said to be working on what will be a mini-iPhone, though very few Apple employees knew the details of the project or had seen the prototype. Despite there being no official announcement, it was said that the expected, less expensive iPhone could be ready to face the world by midyear -- if not delayed, as happened to the white iPhone.
The reason for the lower price is due to the fact that the smaller iPhone would use chips and displays of similar quality to the latest iPhone 4, but not any of the new developments, upgrades, and faster chips that Apple is going to use in the next iPhone to be launched in September this year.
Reports say this new mini-iPhone would be targeted at Europe and some developing markets where Nokia's phones and Google’s Android mobile phones have a good share of the market pie. At a reported price of $200 and no obligation to sign a two-year service contract this smaller iPhone would be in a good position to win the race or, at least, to get closer to its competitors in developing and emerging markets.
"Instead of targeting 25 percent of the global mobile phone market, Apple would be going after 100 percent," says Charlie Wolf, an analyst at Needham & Co. in New York, who has a Buy rating on Apple shares. That sounds to me like a real plan for world domination. My bet is that if Apple makes the less expensive iPhone dream come true, it will have a very good shot at conquering the mobile phone world. It will at least advance its goal of 100 million iPhone users by the end of 2011.
Meanwhile, according to Canalys's January 2011 report, Google's Android was the leading platform by the fourth quarter of 2010 in the global smartphone market with a 32.9 percent share. Nokia ranked second with 30.6 percent, while Apple had 16 percent.
If Apple moves ahead with the mini-iPhone we will witness a tough and very interesting battle for leadership in the smartphone market, but it will be quite a long time before any of the leading mobile phone warriors can declare absolute supremacy -- if that ever happens.
They certainly do think big: "Instead of targeting 25 percent of the global mobile phone market, Apple would be going after 100 percent." I don't know if it is realistic to expect to quadruple one's market and attain that 100%, but I suppose that they believe that aiming for 100% might get them 50% or more, which would still be quite an improvement.
World domination: it's what all the evil masterminds are after in thrillers. You would think if they were rational, they would be content with several billion dollars, but no, it's always the whole world or bust. For a real business plan, though, you have to not revert to the bust if the 100% doesn't happen.
I have a good analogy for this one. It's like an Apple pie. You know you can eat only two slices and yet, you want to eat the whole pie. And yes, will a little more effort you can eat half of the pie. :)
Susan, Mini- I Phone is a good idea. Most of the I Phone is costing around $500 and its little bit costlier when compare with other brands. That means for branding “Apple”, we are paying the extra, which may not be affordable to certain category (weaker section) of peoples. So I think mini- I phone with lesser cost can be affordable to such peoples too and everybody can afford an I phone.
"You would think if they were rational, they would be content with several billion dollars, but no, it's always the whole world or bust."
I would argue that for those of us that would be content with 'several billion dollars', we should not be in the same realm of Apple. The strive to improve and take over more market share is what keeps the engine churning.. or causes your downfall.
"he strive to improve and take over more market share is what keeps the engine churning.. or causes your downfall." Yes, pocharles, the key to success rather than going bust is knowing where the line between the two is.
@Ariella, well, you got to admit that Steve Jobs looks at least vaguely like a James Bond villain...
Anyhow, at first I was skeptical that Apple would attempt to cater to the "lower-end" market, but then I remembered the direction they took with the iPod, introducing smaller, cheaper iPods that were still cool, but not nearly as jam-packed with gizmos as the latest iPods.
So despite that past history and the fact that a mini-iPhone does make sense, I'm still SLIGHTLY skeptical that Apple is actually working on this... but then again, I think they do realize that they've got to do something if they want to capture market share outside of the gadget-obsessed early adopter types.
". . . but then again, I think they do realize that they've got to do something if they want to capture market share outside of the gadget-obsessed early adopter types."
DennisQ,
Apple will always have the gadget-obsessed market eating on its hand. It is wise to broaden the horizon and think of expansion in a different arena. The iPod nano brought Apple a good slice of new consumers. Once people try the flavor of something they do like, most likely they are going to want more.
How many people started buying an iPod nano and upgraded to an iPod or even anothe Apple device? Let's not forget that Apple casts some kind of spell on its products to make them irresistible once they are touched. :D
@Susan, so you're saying that you think the iPod Nano was kind of a gateway drug, serving as a way to get users hooked and getting them to come back for a bigger, more expensive high?
That'd be a pretty funny theory... if it wasn't kinda true! I agree that's exactly what happened in a lot of cases.
So this makes Apple either a super-villain, a drug dealer, or a magician. Perhaps a combination of all three...
We now have to get comfortable, get our popcorn and wait to see how the master plot develops. I am already getting anxious waiting for the day the Apple store opens its doors and presents the new addictive candy, I mean mini-iPhone.
I agree with you, the Mini-iphone will also bring down the present cost of the original iphone. In the overall, It will be more accessible to people of various calibers. Other countries can also have access to it and be able to afford it irrespective of their currency value.
Exactly. Opening new possibilities and a whole new market made up of mobile devices consumers who were waiting for an opportuunity like this for a long time.
I Think that Apple's mini-iPhone worldwide success will depend on the price tag Apple puts on it. $200 is still a lot of money in many emerging and developing countries. Apple may probably not conquer the world with the mini-iPhone and I even doubt it will get that closer to its competitors in emrging countries in terms of the number of items sold.
For being the first Apple's move to create a device for a lower price $200 doesn't sound too bad and it's not too distant from the price range of the competitors. Many consumers who would prefer to have an iPhone simply choose a different device because the iPhone price is too high for them.
I agree with you on that. Apple iphone are still expensive for most developing countries.The best of her products we have in circulation in most of these countries are the Nano Ipods
That is precisely why I assume a cheaper and smaller iPhone would hit the market in a good light. Apple would have better chances to reach low-end markets that didn't reach before. The iPod nano is a good example of how successful a less expensive product can be and still, keeping the quality characteristics Apple develops and offers to its consumers.
"If Apple moves ahead with the mini-iPhone we will witness a tough and very interesting battle for leadership in the smartphone market"
Susan,
I totally agree with you. If APPLE releases handsets in the price range of 200$, it will surely dent the profit margin of Android phones, especially Samsung which is doing very well in Developing markets like India.
$200 is still a pretty steep price for a handset in many countries where Apple is trying to knock out competitors like Samsung and Nokia. Apple will be #1 when it comes to volume of sales, but you can't compare the Iphone to Android because they’re not on a level field. Apple's OS is for the Iphone only, while the Android system is free for any handset maker to use. So as a system Android will be on top because you have multiple companies using the operating system while Apple is the only one using Apple OS.
"Reports say this new mini-iPhone would be targeted at Europe and some developing markets where Nokia's phones and Google’s Android mobile phones have a good share of the market pie".
Am on the side of Apple dominating the world of smartphones. Apple already unique features - quality and rich in graphics are verily acknowledged by the larger percentage of consumer market in some developing and emerging markets not only the fat wallet people. High price has been the apparent reason why up to 70% of smartphone users in developing market shirk away from iphone series.
For me, with mini-iphone planning to roll into markets surely many phone users will soon belong to people who have been living on the edge with Apple products.
"High price has been the apparent reason why up to 70% of smartphone users in developing market shirk away from iphone series."
Totally. Having a closer price range can put things in a different perspective. When price is not the issue, what is the most chosen smartphone in the market?
In the developing and developed worlds Nokia and Blackberry still control largest market share. In 2009 and 2010 for instance the aforementioned phone makers still hold the market control, according to IDC phone market tracking reports
One point that comes to my mind is, suppose if Mini iphone turns out to be a big hit where people get attracted towards the innovative design aand features.
This in turn should not become a threat to iPhone.
The innovation of a mini iPhone would be in size and price rather than design and feautures, like a little brother of the iPhone 4. This means that the soon to be iPhone 5 will still have its market, the ones who always want to have the latest gadget available.
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