Success of iPhone 5 a double-edged sword
There was plenty of disappointment when there was no iPhone 5 reveal at Apple’s WWDC keynote on Monday even though we had been cautioning for some time that we felt this was unlikely. We have always thought that a release in the fall is more likely and that it looks likely to be another smash hit for Apple but news today suggests the iPhone 5 success could be a double-edged sword.
In just two of our most recent articles we’ve told how we feel the iPhone 5 could have enough about it to remain one of the smartphone leaders but also told how the pressure is really on Apple to come up with something groundbreaking for the iPhone 5, especially with a brand-new design as this was something that disappointed many when the iPhone 4S arrived. However the iPhone 4S has sold and is still selling in huge numbers but it seems that success for the iPhone 4S may impact negatively on sales of the iPhone 5.
With Apple’s continued success in the market we had not even imagined that the iPhone 5 would not be a winner to be frank. However a BGR report tells how the demand for the iPhone 5 may not be as high as expected and blames this on the upgrade cycle. This stems from an industry watcher who feels that the achievements of the iPhone 4S will hurt the launch of the iPhone 5. Walter Piecyk is a BTIG analyst and points to current smartphone subsidies being the cause of millions of customers being locked into contracts, many of whom will not be eligible for fully subsidized upgrades at the time of the iPhone 5’s arrival.
Piecyk also noted AT&T as an example of carriers offering subsidies and wrote in a research note of its offer that has been available for over a year and has allowed customers to pay $250 for an early upgrade if they are six months into their contract. Apparently this offer has seen very little interest and the vast majority of customers still wait until the very day that their upgrade with a full subsidy is available. Piecyk also points out that most AT&T iPhone customers will not qualify for an upgrade at the time when the iPhone 5 (or new iPhone) is released.
Although some people will get round this by buying the next iPhone at full price and then selling on their used iPhone models the iPhone 4S has sold in such massive numbers that it is likely to impact iPhone 5 sales. Of course if many people decide to try to sell on their iPhone 4S they may well find the price they get is disappointing as many others may try the same tactic. All of this would appear to mean that demand may be weak for the iPhone 5 although this may be taking too pessimistic a view in our opinion.
On the other side of the coin a Gotta Be Mobile article looks at whether the iPhone 5 can revolutionize the market in the way the original iPhone did. The feeling is that it can but only if Apple come up with something truly groundbreaking for the next iPhone. It then goes on to details some ideas, which could help the iPhone 5 straight to the top of the competition.
These factors include more location awareness, a decent mobile payments system, improved Siri, (we already know that enhancements to Siri are coming with iOS 6), an even easier interface, battery life that excels, a trailblazing camera set up, more iPad and iMac integration and maybe even two iPhone models offering a choice to suit everyone. It also seems likely that this iPhone iteration will be the first to be 4G LTE-equipped.
Of course many of us are already expecting some of these to be included on the iPhone 5 but it really is down to Apple now to come up with the goods and impress us all. Do you think Apple can come up with something really innovative for the iPhone 5 that could make it a must-have smartphone? What do you think about the analysts report saying there will be weaker demand for the new iPhone because of the upgrade cycle? We’re really interested to hear from readers about this so please do send us your comments.