Its been a few days since Apple's iPhone event. Apple introduced two new iPhones, 5C & 5S, and discontinued the iPhone 5. Surprisingly, all the rumors related to fingerprint scanner, colors and even the names of the new iPhone were true. It looks like the Jobsian era of secrecy has come to an end.
Apple is the clear leader in the smartphone market, with over 70% of profits. With the new phones, the flagship model from the leader has just shed a cool $100 from the price tag, effectively bringing down the high water mark in the market. While Apple will recover the margins with a cheaper to manufacture 5C, iPhone 5S and accessories, Samsung will probably lose some market share from its Galaxy top range.
The new phones crown bluetooth as king for sharing and connections, making NFC's mass adoption a distant dream now. When the leading provider does not carry the technology, its future is truly limited.
Cases and docks are once again in vogue for Apple. This will help Apple regain some lost margin. Cases are typically bought along with the phone. Even though the phone is cheaper, the overall impact considering the carrier subsidy, might be minimal. The phones are being launched in more countries, with Japan & China (not announced yet, but expected) being notable additions. This will add more volume in product distribution. Without a doubt we will see more iPhones sold this holiday quarter than ever before.
More money. Less impact on margins. I am going long on Apple.
I understand that from a portfolio perspective, the iPhone 5 had to be discontinued. People like to buy a newly released phone, and the new design preserves this notion even though the internals are all the same. Does this also hint at a iPhone 5X in the near future? Only time will tell.
Everybody agrees that the iPhone 5C is the new flagship model from Apple. It is the first one listed on the carousel at apple.com. It is also the first one available for pre-order. This despite the fact that it is essentially one-year-old internals in a new plastic skin. Personally, I would have loved to see a darker blue or a blood red option in the colors available. Maybe Apple would release them later. White color looks all alone, without its usual friends black and grey. It is understandable that the black & grey might overlap with the colors from iPhone 5S, but the curves and glossiness is a good enough difference to offer black & grey colors for the 5C.
The iPhone 5C is still not a product for the prepaid or unsubsidized market. It is a product focused on the top rung. Apple as a company has always focused itself on the high end of the market. The subsidy system hides this fact very well, a fact corroborated with iOS's high market share in the US. The cases get people who are either against glossy finish or like rubbery textures on board. The logo error is a rare mistake in design from Apple. I expect it will be fixed before the holiday season.
The 5C screen is the same as its predecessor. This might aid developers with app layouts, but probably points to Apple thinking the screen is good enough for most tasks. Apple customers are the carriers. I would not be surprised to see some more price drops on contracts, making them free on two year contracts. And you cannot offer cheaper than free. iTunes gift cards could also be used by various retailers to bring the price down even further.
The iPhone 5 is a very good phone. I use it everyday. iPhone 5S doubles its performance and sports a new camera. But this performance boost has to suffice till the next round of phones are introduced. Quad core was not mentioned anywhere. Apple must have realized the processors are not the bottleneck on the phone performance. The iPhone 5 was in a way over-serving the market, and there was no point in adding more power and over-over-serving it. This bucks the current trend on Android phones with more processing power, bigger screens and more megapixels on the camera.
The new technology on the 5S indicates what Apple has in store for future. 64-bit architecture, M7 chip, iBeacon and fingerprint sensor are features that will become more powerful with time. They hint at the overall plan Apple has with the iPhone. These features cannot be imitated easily by the competition.
The new tech also tells us how clueless other players in the smartphone market are, with the notable exception of Nokia. We have seen two apps running simultaneously, multiple user accounts, face detection etc, but nothing along the lines of what Apple has introduced in the 5S. "Forward thinking" tagline is a huge hint for things to come. The fingerprint sensor is a welcome advancement. Unlocking the phone is now easier, and more secure. Same with iTunes purchases. Because of password length requirements, this saves typing at least 8 characters for everyone. On colors, Gold was probably the only color option that could be introduced. It is expected to be a huge draw in certain markets.
The iPhone camera sees an improvement on the sensor front, cementing its position as the best camera on smartphones for a few more months. A few other software features like slow motion recording & burst shooting mode will keep things interesting for the casual shooters.
These are my initial thoughts on the phone launch. iOS 7 has a few tweaks since last seen. Apple has listened to the feedback and made the font a bit more readable. I am planning to update to iOS 7 on my iPhone 5 as soon as it is available. I will write about the new OS experience soon!