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iPhone not really hottest smartphone in July, but could be in Sept

post #1 of 29
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The iPhone didn't really outsell every other smartphone on the market during the month of July as an earlier study had implied, but new momentum generated by a recent $200 price cut could push the Apple handset atop the market segment rankings by the end of the month.

In a report issued last Tuesday, market research firm iSuppli said the iPhone accounted for 1.8 percent of all mobile-handset unit sales in July, outselling the BlackBerry series, the entire Palm portfolio, and any individual Motorola, Nokia, Samsung or other smart phone model from a branded service provider.

Word of the news sent Apple shares on a mini $4.50 (3 percent) surge before those same shares were beaten back down less than 24 hours later on investor speculation that the company's unprecedented 33 percent iPhone price cut meant sales were tracking far behind management's expectations.

Presumably under scrutiny, iSuppli on Thursday issued a "clarification" regarding its earlier report, in which it backpedaled on just how popular the Apple handset was amongst consumers during its first full month on the market.

"iSuppli’s sell-through research and the subsequent press release indicated that the iPhone outsold all smart phone models in July in the United States on an individual basis," the firm wrote. "While iSuppli stands by this analysis, it is important to note that iPhone’s retail sales did not exceed the combined retail sales of the entire BlackBerry line of smart phones in the United States in July."

In fact, when all sales of all BlackBerry models for the month of July were totaled together, they combined for approximately twice as many sales as the iPhone, iSuppli clarified. That would mean that Research in Motion's BlackBerry garnered an approximate 3.6 percent share of the US mobile handset market compared to Apple's 1.8 percent. But given its $200 price drop on the iPhone last week, Apple may be poised to build on that share in the immediate future, potentially trumping BlackBerry sales, if even for only a short time.

In a research note released to clients yesterday, Piper Jaffray analyst Gene Munster said his checks indicate that iPhone sales increased threefold in the first five days following the price cuts. He, along with a fellow wireless analyst, had previously spent 50 hours in Apple and AT&T retail stores attempting to gauge demand for the handsets and had concluded that the two firms were combining for sales of approximately 9,000 iPhones each day.

"As of Sunday, Apple had sold 730,000 units in the quarter, which suggests that in the 5 days since the price cut, Apple has sold 136,000 phones," Munster wrote in his new report. "This new run rate implies 27,000 iPhones per day, which clearly represents an initial surge that is not sustainable."

The analyst said iPhone sales will likely stabilize at an approximate 50 percent increase to the rates witnessed before Apple cut prices. Therefore, should Apple manage to sustain just a twofold increase in sales for the remainder of the month, it'll have a shot at besting sales of Research in Motion's entire BlackBerry mobile line during the month of September, as iSuppli erroneously reckoned that it did in July.
post #2 of 29
I just want to point out that the sales increase number of ~200% is VERY uncertain. Their sales estimate of 9,000/day put Apple at 864,000 when the price cut occurred (including the 270,000 in the last quarter). But if they were off by just ~10%, and the sales were actually 10,000/day (instead of 9,000) up to that point, then they would have sold 930,000. Then that would mean Apple would only have needed to sell 14,000/day the final five days. A 50% increase... NOT 200% !!!!

I think it's VERY possible that they were off by ~10% in their sales estimate as they sampled only a small fraction of stores, for only a total of 50 hours, and don't have a good indication of onlines sales.

Gene munster should be more careful when claiming these things. A small uncertainty in the daily sales estimate results in a massive uncertainty in the predicted increase in sales due to the price drop.
post #3 of 29
Quote:
Originally Posted by astromac View Post

I just want to point out that the sales increase number of ~200% is VERY uncertain. Their sales estimate of 9,000/day put Apple at 864,000 when the price cut occurred (including the 270,000 in the last quarter). But if they were off by just ~10%, and the sales were actually 10,000/day (instead of 9,000) up to that point, then they would have sold 930,000. Then that would mean Apple would only have needed to sell 14,000/day the final five days. A 50% increase... NOT 200% !!!!

I think it's VERY possible that they were off by ~10% in their sales estimate as they sampled only a small fraction of stores, for only a total of 50 hours, and don't have a good indication of onlines sales.

Gene munster should be more careful when claiming these things. A small uncertainty in the daily sales estimate results in a massive uncertainty in the predicted increase in sales due to the price drop.

Yeah, you think he would be carefull in pulling his foot out of his mouth not to be sticking the other one in deeper...
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post #4 of 29
Munster is all about his clients and his own ass, he doesn't care if Apple succeeds or fails... just that he can make a profit.

The rest is up to Apple. I'm a bit disappointed that Apple has allowed Jobs to put the company out there without an adequate iPhone growth strategy.

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post #5 of 29
To me anyway, it's quite obvious that it's not that demand for the iPhone is lower than demand for the Blackberry, but a lot of people who wanted it either wouldn't pay, or couldn't afford to pay the $599 price tag (as nobody wanted the 4Gig version). With this new price the jump in sales is far from a surprise, now if you want one, you can likely get one. $399 isn't that much for this device, and things can only get better.
Citing unnamed sources with limited but direct knowledge of the rumoured device - Comedy Insider (Feb 2014)
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post #6 of 29
Quote:
Originally Posted by AppleInsider View Post

market research firm iSuppli said the iPhone accounted for 1.8 percent of all mobile-handset unit sales in July

Is that all mobile-handset unit sale worldwide?
Or US only?
post #7 of 29
Quote:
Originally Posted by GregAlexander View Post

Is that all mobile-handset unit sale worldwide?
Or US only?

U.S. -- that is clarified later in the article. Since iPhone is only sold in the U.S., it also wouldn't make much sense for research frims to pit it against the entire world.

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post #8 of 29
There was no overall correction, just a clarification about RIM, and that detail was always clear to me anyway: they singled out Palm and said that the iPhone outsold all Palms put together. To me that made it clear that Apple did NOT outsell the whole product line combined for OTHER makers.

They DID however outsell any individual phone, even from RIM--there has been no backpedaling, just a clarification. So AI's title is misleading.

Of course now anti-iPhone commentators will now say that iSuppli "took it back" and iPhone was NOT the best-selling smart phone even though it still was.

(I know there were two iPhone models available, but that doesn't take away from the iPhone's amazing success as a newcomer.)
post #9 of 29
I just spoke to an AT&T store in Bellingham, WA and in the last week they've sold 194 iPhones alone!!

The rep there told me that the reason was the fact that the phone is reliably unlock-able now and that not only Americans were buying it but tons of Canadians as well. A quick check at vancouver.craigslist.org lists a bevy of unlocked iPhones ranging from 530 for a 4GB model to 850 for an 8GB model.

I think we're going to see serious numbers for this month alone.
post #10 of 29
Quote:
Originally Posted by SpamSandwich View Post

The rest is up to Apple. I'm a bit disappointed that Apple has allowed Jobs to put the company out there without an adequate iPhone growth strategy.

What?
post #11 of 29
This new device, running a platform we're all told is hopeless (MacOS) is selling in its first two months half the volume as an 8-year established champion competitor?

Sweet.
post #12 of 29
Quote:
Originally Posted by potterhead4 View Post

What?

Growth strategy = Plan to infiltrate all price levels to provide serious competition to the numerous cell phone manufacturers and designers.

Apple currently has one model available at one price level. This needs to change quickly. The novelty of a touchscreen will not provide sustainable growth.

They have a strategy but they are totally reliable on one product in the cell phone/smartphone category. That is not good.

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post #13 of 29
I think the $400 price is the growth strategy. Hopefully they will offer a iPhone nano next year to go after the not-as-smart-phone market, but one thing at a time. iPhone still needs work (Exchange Calendar support, better email handling, more open, search for contacts).

I got one for $299. I must say it is a totally incredible device. Its the first iPod that I have really adopted and enjoyed.

Some kids saw me using it and I heard them say, "why would I buy another iPod when I could get an iPhone and have it all in one." Thats my feeling too.

And I think that once they start using it, it will be hard to switch back to anything else.

Contrast that to my sister who against my advice got a BB Curve and now even though she likes the Curve, kinda wants an iPhone. It tells you how strong the iPhone appeal is.
post #14 of 29
Quote:
Originally Posted by SpamSandwich View Post

Growth strategy = Plan to infiltrate all price levels to provide serious competition to the numerous cell phone manufacturers and designers.

Apple currently has one model available at one price level. This needs to change quickly. The novelty of a touchscreen will not provide sustainable growth.

They have a strategy but they are totally reliable on one product in the cell phone/smartphone category. That is not good.


I'd guess they plan on diversifying the line based on how much flash memory each unit comes in, as they did before they dropped the 4GB. The only other direction they can go in is screen size i.e. smaller and thus being less expensive. However, if you made the screen too much smaller you'd loose the web experience and it would make the touch screen harder to use. Currently you have 3.5" iPhone, 2.5" iPod classic, and 2.0" iPod Nano. The iPod and Nano screens are much too small, I think, even given their high quality, to be used as touch screens. So you're left with 3.0" but would that really make that much difference in price and form factor? Apple wants multi-touch to be at the core of their iPhone (any Apple phone) experience and too small a form factor would limit that. I don't think Apple has any interest in competing at the low end of the cell phone market.
post #15 of 29
Quote:
While iSuppli stands by this analysis, it is important to note that iPhones retail sales did not exceed the combined retail sales of the entire BlackBerry line of smart phones in the United States in July."

Last time i checked the iPhone isnt an entire line of phones.
post #16 of 29
Quote:
Originally Posted by imacFP View Post

I'd guess they plan on diversifying the line based on how much flash memory each unit comes in, as they did before they dropped the 4GB. The only other direction they can go in is screen size i.e. smaller and thus being less expensive. However, if you made the screen too much smaller you'd loose the web experience and it would make the touch screen harder to use. Currently you have 3.5" iPhone, 2.5" iPod classic, and 2.0" iPod Nano. The iPod and Nano screens are much too small, I think, even given their high quality, to be used as touch screens. So you're left with 3.0" but would that really make that much difference in price and form factor? Apple wants multi-touch to be at the core of their iPhone (any Apple phone) experience and too small a form factor would limit that. I don't think Apple has any interest in competing at the low end of the cell phone market.


I agree heavily. Whomever got the idea in their head that there would ever be a smaller version (nano) was confused, and now everyone treats this as some kind of fact. The size NEEDS to reach from your ear to your mouth, the touch aspect needs to be this big, the screen should never be smaller. If anything, it would be great if it were THICKER to allow a real Hard Drive. That would really help those of us who like video. But I believe that will never happen.

Apple will simply grow this product by:
1. Adding memory. For myself, I am holding off buying it until at least 16 gig.
2. Adding better communication, eg, GPS, 3G, etc.
3. Adding real computer features, like spreadsheet, word processing
4. Possibly bluetooth external foldup keyboard
5. Lowering the price even more.

That's my thoughts, folks!

Steve
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post #17 of 29
Quote:
Originally Posted by montefuego View Post

Whomever got the idea in their head that there would ever be a smaller version (nano) was confused, and now everyone treats this as some kind of fact. The size NEEDS to reach from your ear to your mouth, the touch aspect needs to be this big, the screen should never be smaller. If anything, it would be great if it were THICKER to allow a real Hard Drive. That would really help those of us who like video. But I believe that will never happen.

Apple will simply grow this product by:
1. Adding memory. For myself, I am holding off buying it until at least 16 gig.
2. Adding better communication, eg, GPS, 3G, etc.
3. Adding real computer features, like spreadsheet, word processing
4. Possibly bluetooth external foldup keyboard
5. Lowering the price even more.

That's my thoughts, folks!



I tend to agree. If anything, the iPhone lineup should grow UPWARDS in functionality/price, not downwards.

I'd expect something like an 'iPhone UMPC', bridging the gap between an iPhone and a subnotebook, before I'd expect a (rather pointless, heavily compromised) 'iPhone Nano'. \

(even if I did see a fan-made mock-up of one that looked really cool).

But I think even something like that is a-ways off. Apple's got to get the current iPhone on rock-solid footing first: 3G, higher capacities, fixing most of the iPhone 1.0 flaws, successful European and Asian launches. There's tons of work to do.

.
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post #18 of 29
Quote:
Originally Posted by SpamSandwich View Post

Growth strategy = Plan to infiltrate all price levels to provide serious competition to the numerous cell phone manufacturers and designers.

Apple currently has one model available at one price level. This needs to change quickly. The novelty of a touchscreen will not provide sustainable growth.

They have a strategy but they are totally reliable on one product in the cell phone/smartphone category. That is not good.

Yes, and when RIM launched the Blackberry in 1999 there were 14 models covering the entire spectrum of cell phone/smartphone price points and demographics.

Fact is the first Blackberry didn't even do voice and was the RIM Inter@ctive Pager 900 that was replaced by the Blackberry 950. You could get any model you wanted. As long it was a 950. You could use any provider you wanted. As long as it was Mobitex.

Of course, these guys didn't have a growth strategy either and soon faded into the depths of history.
post #19 of 29
Quote:
Originally Posted by mrpiddly View Post

Last time i checked the iPhone isnt an entire line of phones.

Exactly. All this report is saying is that the single iPhone model (the memory size difference hardly counts as a separate model) didn't outsell the entire line of it's competitors in it's first couple of months on sale, in a single country

No sh!t

It did however beat RIM's entire line of consumer products. We all know that RIM are very focussed on the enterprise email market, and I wouldn't really consider the iPhone as a direct competitor anyway - it's more of a consumer product. The iPhone sold more than RIMs entire consumer line

Have these analysts not seen any of the customer feedback reports on the iPhone either ? The satisfaction indices are off the charts. Now that the price has dropped too, I think it's hard to see how the iPhone wont do well, especially in the run up to Christmas.
post #20 of 29
I don't see why they even did this comparison to begin with. Of course the iPhone will outsell a SINGLE phone from any other phone maker, because all the other phone makers have dozens of options. Apple had 2, now it's down to 1. It was a silly comparison to begin with.
Quote:
Originally Posted by Gee4orce View Post

Exactly. All this report is saying is that the single iPhone model (the memory size difference hardly counts as a separate model) didn't outsell the entire line of it's competitors in it's first couple of months on sale, in a single country

No sh!t

It did however beat RIM's entire line of consumer products. We all know that RIM are very focussed on the enterprise email market, and I wouldn't really consider the iPhone as a direct competitor anyway - it's more of a consumer product. The iPhone sold more than RIMs entire consumer line

Have these analysts not seen any of the customer feedback reports on the iPhone either ? The satisfaction indices are off the charts. Now that the price has dropped too, I think it's hard to see how the iPhone wont do well, especially in the run up to Christmas.

I would say "NO SHIT" to their one model outselling a SINGLE outselling other phone makers single model, when others have so many to choose from.
post #21 of 29
Quote:
Originally Posted by jpellino View Post

This new device, running a platform we're all told is hopeless (MacOS) is selling in its first two months half the volume as an 8-year established champion competitor?

Sweet.

Yes, and this is even without the first major software update released yet.
post #22 of 29
Quote:
Originally Posted by SpamSandwich View Post

Growth strategy = Plan to infiltrate all price levels to provide serious competition to the numerous cell phone manufacturers and designers.

Apple currently has one model available at one price level. This needs to change quickly. The novelty of a touchscreen will not provide sustainable growth.

They have a strategy but they are totally reliable on one product in the cell phone/smartphone category. That is not good.

First, Apple has a goal. Namely to sell 12 million iPhones by the end of 2008. Second, it clearly has a strategy to satisfy that goal. We have seen part of that strategy with the recent price cut. Third, to claim Apple is relying on one product is silly. The iPhone is merely its first product, which has only been out for two months. Apple will introduce different models. Finally, Apple had a plan for the music player market. It took it a couple of years for the plan to bear fruit.
post #23 of 29
Quote:
Originally Posted by montefuego View Post

I agree heavily. Whomever got the idea in their head that there would ever be a smaller version (nano) was confused, and now everyone treats this as some kind of fact. The size NEEDS to reach from your ear to your mouth, the touch aspect needs to be this big, the screen should never be smaller. If anything, it would be great if it were THICKER to allow a real Hard Drive. That would really help those of us who like video. But I believe that will never happen.

Apple will simply grow this product by:
1. Adding memory. For myself, I am holding off buying it until at least 16 gig.
2. Adding better communication, eg, GPS, 3G, etc.
3. Adding real computer features, like spreadsheet, word processing
4. Possibly bluetooth external foldup keyboard
5. Lowering the price even more.

That's my thoughts, folks!

Steve


That's right. If there were such a thing as flexible and bendable screens than maybe Apple could come up with a clamshell shape "xPhone" (you knew that was coming) that could be folded and then open up into a full sized screen. If you can't type on the screen than I don't think Apple will produce it. Apple won't do plastic buttons, as Steve said himself "The problem is really in the bottom 40% -- keyboards that are there whether you need them or not. They have control buttons that are fixed in plastic. Every app wants a different button..." We could all be totally wrong but I think it would be very hard to use multi-touch in a smaller "less costly" form factor. What I could see happening, maybe, is Wi-Fi coming to the other iPods, but you won't see a iPhone nano for awhile, if ever.
post #24 of 29
I also have doubts there will be a "nano" phone unless it can provide significant competition to all of the free and low-cost phones out there. The iPhone line needs to become 'broader' if not deeper.

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post #25 of 29
Quote:
Originally Posted by SpamSandwich View Post

I also have doubts there will be a "nano" phone unless it can provide significant competition to all of the free and low-cost phones out there.

Well it could be good looking, easy-to-use, and it could also be an iPod.
And, it could be slim, small, aluminum and colors

What teen wouldn't want that?

Rest assuredly assured Spam, it's a comin'
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post #26 of 29
As for the iPhone, it desperately needs 3G for the European market, and desperately needs 16GB internal storage. I'm 100% for an all in one phone. Although currently not economically viable, a 32GB iPhone would be so sweet, like really sweet.
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post #27 of 29
Quote:
Originally Posted by TerrinB View Post

First, Apple has a goal. Namely to sell 12 million iPhones by the end of 2008. Second, it clearly has a strategy to satisfy that goal. We have seen part of that strategy with the recent price cut. Third, to claim Apple is relying on one product is silly. The iPhone is merely its first product, which has only been out for two months. Apple will introduce different models. Finally, Apple had a plan for the music player market. It took it a couple of years for the plan to bear fruit.

My thoughts exactly. I'm just wondering how you (Spam-o) can claim to even know they don't have a strategy, especially after two months.
post #28 of 29
Quote:
Originally Posted by potterhead4 View Post

My thoughts exactly. I'm just wondering how you (Spam-o) can claim to even know they don't have a strategy, especially after two months.

First time I've been called Spam-O, but whatever...

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post #29 of 29
Quote:
Originally Posted by Ireland View Post

Well it could be good looking, easy-to-use, and it could also be an iPod.
And, it could be slim, small, aluminum and colors

What teen wouldn't want that?

Rest assuredly assured Spam, it's a comin'

I still hope they make a clamshell version...

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