Apple is Set to Announce two IPhones
SAN FRANCISCO — The handset market is so brutally competitive that
Apple, the most successful smartphone maker, is preparing to step up its
game this week by offering two new iPhones instead of one.
At an event on Tuesday at its Cupertino, Calif., headquarters, the
company is set to unveil for customers a new iPhone with a
faster processor, along with another model that will be sold at a lower
cost.
The company growth has slowed in response to a saturated
handset market in America &Europe. Many people already have a
smartphone and are not upgrading to new devices.
A lower-cost smartphone could allow Apple to expand into overseas
markets especially China, where the iPhone has been highly desired
among many consumers but is just out of reach because of its price.
“A cheaper model will open up the market significantly for Apple, said Chetan Sharma, an independent telecom analyst who consults for phone carriers.
Apple declined to commeent on the new products. But Analysts expect
the higher-priced model to be an improvement over the current IPhone,
including a faster processor and better camera flash
The second IPhone is expected to be a cheaper version of the
soon-to-be-out dated IPhone 5, coming in a variety of colors, with a
plastic case instead of aluminum. Analysts expect the full price of the
lower-cost IPhone to be $300 - $400.
Apple successful because of the IPhone earning most of
its revenue. In the second quarter, the company took 53 percent of the
profit in the global smartphone market, with Samsung Electronics, which
uses Android software to run its smartphones, taking the rest,
according to a survey by Canaccord Genuity, an investment bank.
But both Apple and Samsung face a common enemy: the tide of manufacturers that produce dirt-cheap Android phones.
While they make all the profits, Apple and Samsung have seen their
combined share of the worldwide smartphone market drop to 43 % in
the second quarter from 49 % a year earlier. The makers of cheaper
phones including Huawei, Yulong and ZTE of China, and Micromax and
Karbonn of India are raking in sales in emerging markets where
high-end smartphones are not popular.
“We have had several indications from the handset market that vendors are
in real trouble,” said Tero Kuittinen, an analyst for Alekstra, a mobile
diagnostics firm. “The biggest threat to all the companies seems to be
the low-end Androids.”
Smartphones surpassed traditional flip phones this year. There are a
few markets remaining where traditional cellphones are still outselling
the smartphone, including India, Brazil and Russia. Data from Qualcomm
suggests that Latin America, China and India are adding substantially
higher numbers of smartphone subscriptions . North America, Japan,
Korea and Europe.
China,
with its huge population, is an attractive target for Apple. But
Timothy D. Cook, Apple’s chief executive, said recently in a call with
investors
that the company was puzzled about why sales of its products were
struggling in China. Sales there fell 4 % in the second Quarter
compared with the same Quarter last year. Apple’s sales in Hong Kong
were down about 20 %.
A cheaper iPhone could help it gain traction in China
Apple already sells its phones in China , a major
network operator, but it slipped into sixth place among smartphone
makers there in the second quarter, with a share of only 4.8 %,
according to Canalys, a research firm.
In Japan, where Apple is much stronger but faces a renewed challenge
from domestic smartphone makers , the company has struck a deal
to sell the IPhone with the country biggest mobile phone carrier, NETT
Docomo, two people briefed on the situation said Friday. Docomo has 60
million customers, but it has been losing market share to Japan’s other
two main mobile operators, Soft Bank and KDDI, which operates under the
brand name Au. Both have been marketing Apple phones aggressively,
giving Apple a 40 % share of smartphone sales in the first
quarter, according to IDC, a research firm.
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