Report: iPhone outpacing rivals in Europe without 3G
Despite a very familiar set of limitations, the iPhone is showing continued demand in Europe and leading its immediate rivals, says RBC analyst Michael Abramsky.
Sales checks in France, Germany, and the UK have all revealed strong sales both during and immediately after each country's respective launches. While T-Mobile's initial launch saw only 10,000 iPhones sold in Germany on the first day, many of the carrier's 700 retail stores continue to reflect a "solid" demand of 15-20 iPhones sold per week, Abramsky says.
France has so far proven the most immediately successful of the three nations, having registered roughly 63,000 customers on Orange's website amid reports of sellouts at some of the cellular provider's Parisian stores. Britain's O2 sold between 30,000 and 40,000 iPhones on its first weekend.
Surprisingly, reports from all three countries point to the device outrunning competitors that should theoretically fare better than the iPhone due to features or price. Phones like the HTC Touch or LG Prada are often heavily subsidized or offer features that the iPhone lacks, but are still being outsold by Apple's first offering.
The iPhone is even outselling Nokia's well-known N95 smartphone, which has sold more than a million units in the UK since its March release, the analyst writes.
Europeans are still hesitant to buy the iPhone due to the lack of fast 3G Internet access, its stripped-down Bluetooth feature set, and an unusually high price. However, the statistics suggest that a future 3G iPhone will be more of a pleasant upside to the iPhone's sales than an absolute necessity, Abramsky notes.
The strength of the iPhone is leading RBC to increase its total iPhone forecast to 12.5 million phones sold worldwide by the end of calendar 2008, 25 percent higher than Apple's stated goal of 10 million. About 4 million of these will come from buyers outside the US and may include countries such as Canada, Italy, and Spain, all of whom are top candidates to receive the iPhone next year.
A popular iPhone in Europe could also result in a "halo" that translates to increased sales for the Mac on the continent, according to the report.
Sales checks in France, Germany, and the UK have all revealed strong sales both during and immediately after each country's respective launches. While T-Mobile's initial launch saw only 10,000 iPhones sold in Germany on the first day, many of the carrier's 700 retail stores continue to reflect a "solid" demand of 15-20 iPhones sold per week, Abramsky says.
France has so far proven the most immediately successful of the three nations, having registered roughly 63,000 customers on Orange's website amid reports of sellouts at some of the cellular provider's Parisian stores. Britain's O2 sold between 30,000 and 40,000 iPhones on its first weekend.
Surprisingly, reports from all three countries point to the device outrunning competitors that should theoretically fare better than the iPhone due to features or price. Phones like the HTC Touch or LG Prada are often heavily subsidized or offer features that the iPhone lacks, but are still being outsold by Apple's first offering.
The iPhone is even outselling Nokia's well-known N95 smartphone, which has sold more than a million units in the UK since its March release, the analyst writes.
Europeans are still hesitant to buy the iPhone due to the lack of fast 3G Internet access, its stripped-down Bluetooth feature set, and an unusually high price. However, the statistics suggest that a future 3G iPhone will be more of a pleasant upside to the iPhone's sales than an absolute necessity, Abramsky notes.
The strength of the iPhone is leading RBC to increase its total iPhone forecast to 12.5 million phones sold worldwide by the end of calendar 2008, 25 percent higher than Apple's stated goal of 10 million. About 4 million of these will come from buyers outside the US and may include countries such as Canada, Italy, and Spain, all of whom are top candidates to receive the iPhone next year.
A popular iPhone in Europe could also result in a "halo" that translates to increased sales for the Mac on the continent, according to the report.
Comments
I think it's more the olah effect meaning Apple's success in Europe with the iPod and Macs will translate into higher than expected iPhone sales.
I don't care what the explanation is. I just hope people will remember that the 'experts' have been saying for weeks that the iPhone won't sell in Europe - and maybe they'll stop believing the Apple-bashing 'experts'.
I don't care what the explanation is. I just hope people will remember that the 'experts' have been saying for weeks that the iPhone won't sell in Europe - and maybe they'll stop believing the Apple-bashing 'experts'.
They may be selling but I've still not seen anyone using one and I live in Central London. If people are buying them, where are they..?
Reports: UK consumers slow to adopt Apple's iPhone
According to a recent report by the Register citing reliable channel sources, exclusive UK iPhone carrier O2 has activated just 26,500 iPhones since its launch two weeks ago, well below expectations of about 100,000 units...
http://www.appleinsider.com/articles...es_iphone.html
So... which is it?
Even adjusting upwards to the current article's "Britain's O2 sold between 30,000 and 40,000 iPhones on its first weekend", isn't that still 'well below' expectations of 100,000 units for the UK??
The German results also do not seem strong... only 10K units sold on launch day, compared to 270K units sold in the US during launch weekend? So why then does said RBC analyst seem to be bullish? The French results? The ability of the iPhone to outsell other, older phones during launch? Gosh, you'd think it'd be able to, that's the time of the highest hype and pent-up demand.
In any case, as a shareholder, I'm hoping that Apple does at least okay during launch, once the figures are sorted out. That's the easy part.
Getting and keeping those sales numbers high over the long haul is the real (and difficult) task.
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They may be selling but I've still not seen anyone using one and I live in Central London. If people are buying them, where are they..?
I'm here! Must admit I've not seen anyone else using one yet... but it's possible that many people are hiding them away when in use - when I take mine out in public on, say, a train, I feel the whole carriage straining to have a look
Everyone I've shown it to are most impressed by the user interface - the sheer speed of the response, the animation and how easy it is to use. The pinch zooming and rotation are absolute killers, consistently drawing "oohs" and "aahs" from the audience.
Alas, nobody wants to know once I tell them how much I have to pay each month for the O2 contract. It's a real shame that O2 doesn't offer more flexible contracts, or even a pay-as-you-go option.
A side note: I have started seeing a few people with iPhones on the trains now, usually people commuting in and out of London via Waterloo. iPods and Blackberrys are still more ubiquitous though.
I'm here! Must admit I've not seen anyone else using one yet... but it's possible that many people are hiding them away when in use - when I take mine out in public on, say, a train, I feel the whole carriage straining to have a look
after so many months, i am still surprised every day or two when someone leans over and asks to take a look. The idea that the Iphone with the features presented will not sell in Europe is not a savvy minded viewpoint. Obviously, those who have no idea of consumer electronics marketing will defend what they do know about a competitive product or something of the sort of crap put out by people looking for controversy. but the bottom line is that distribution, product features and company profile all make for a successful launch and sell through. Apple isn't taking over the world with the phone - but they are presenting a nice alternative to feature laden products from competitors - and they are presenting NOW what everyone will expect in the future. Updated the software on your phone lately? how long did it take the dude behind the counter to set up the last one? on and on. these small and significant steps are not so easy to implement from a competitive base that has not been on their toes lately. The motorola razor is the best example of a not well thought out marketing mix. the expected less than 10% of the response that came with the phone? they have no concept of the consumer wants or what makes them tick. Apple is approaching it as a consumer electronics company. This means they are building a customer franchise where brand, innovation and a marketing mix of features with other products all go together in one fancy package. they are not taking over the world of a Nokia.. they are offering an alternative to a market full of piece meal approaches to consumer wants and needs. everyone gets a piece of the action with new innovations - but only a few understand how to make money at it. apple is doing this very very well.
Mass sales of the iPhone are going to be primarily driven by good cell phone, iPod and maybe photos. (and of course the primary reason, ease of use of those features.) For most people, web access is far less important than the other 2 or 3, with movie viewing trailing the bunch.
Ease-of-use for web-based features, and battery life far outweigh the marginal difference of 3G. The 'more sophisticated European users' are bearing this out.
I think Apple has gotten the thing amazingly right. They have not let the 'good' fall prey to the 'best'.
Mass sales of the iPhone are going to be primarily driven by good cell phone, iPod and maybe photos. (and of course the primary reason, ease of use of those features.) For most people, web access is far less important than the other 2 or 3, with movie viewing trailing the bunch.
Ease-of-use for web-based features, and battery life far outweigh the marginal difference of 3G. The 'more sophisticated European users' are bearing this out.
If you are getting an iPhone as a phone first, you are missing the boat entirely; your priorities are completely opposite the real market. It's a phone last-- it is a web browser, mail client, entertainment device first... and it happens to be a great phone as well.
Everybody uses their toys for different things, but what makes the iPhone compelling is doing a great job with the web experience.
Things like battery life just make people hate a phone afterwards, they don't bias people up front.
The iPhone is even outselling Nokia's well-known N95 smartphone, which has sold more than a million units in the UK since its March release, the analyst writes.
I don't think out-selling a year-old phone is much to crow about. Especially considering that iPhone commercials are constantly on TV and all of the stores involved have devoted a lot of floor space to the device. Any device given this much backing should sell a few thousand units.
If you are getting an iPhone as a phone first, you are missing the boat entirely; your priorities are completely opposite the real market. It's a phone last-- it is a web browser, mail client, entertainment device first... and it happens to be a great phone as well.
Everybody uses their toys for different things, but what makes the iPhone compelling is doing a great job with the web experience.
Things like battery life just make people hate a phone afterwards, they don't bias people up front.
We'll agree to disagree. Of the literally dozens of iPhone owners I know well (most of whom are in the tech industry, btw) web access is handy, but given a faster connection (leaving wi-fi aside) or ease-of-use and integration, the latter wins hands down. I've not heard 1 person (outside this forum) complain about access speed.
All I'm saying is that the 'no 3G will sink the product' crowd has been, quite frankly, wrong.
In fact, had Apple included it in generation 1, that would have endangered the product far more.
Just saying Apple got it right.
Even going off the most optimistic of the estimates in the article Apple didn't sell more than 200,000 in it's launch month in Europe and ongoing it's selling 14,000 a week (at best) in Germany. That's terrible. 2 phones a day in each store.
The Nokia N95 sold 1.5million in the summer quarter. It's in their Q2 financials. There's a banner advert on this very site advertising it as FREE including 8GB, 800 minutes, unlimited texts, GPS data for £40.
LG Prada???? Why would anyone buy that when you can get an LG Viewty for £29?
HTC Touch? - it's a year out of date. Try a Tytan or Touch Dual if you really want a WinMo geek toy or one of the many rebages. If the analyst actually paid attention to the UK market though, WinMo is in single digit territory for phones. We buy Symbian here.
He got one thing right, 3G won't make much difference. You've got to get past the cost of the handset and tariffs first.
The iPod Touch coming to market right before I'm sure also hurt sales of the iPhone.
But I would agree the most damning factor is the carrier tariff. If I had to get an iPhone in Europe I would hesitate to agree to that deal.
But having said all of that it is selling. People are in a rush to call it a failure because it isn't decisively blowing every other phone away in sales. In reality that was never going to happen.
That's where the iPod/iPhone wins hands down.
And not to be rude, most 22 year old journalists don't make that money so to them, $400-$600 to spend on a phone is like 500 Pabst Blue Ribbon beers or a huge % of their monthly wages while for most of us, it's about a day or two's pay so really, not that big of a deal if it's what we want.
Bottom line: iPhone's 30 features can ALL be accessed with a tap or two versus trying to access 50 features on any other phone requires menu switching, menus, submenus, guessing at what DSML means and more menus on a low res screen.
And the 3G thing? Would you rather wait 20 seconds on a world class 3.5" high-res screen that orients and is pinch enlargeable or would you rather try and decipher the web in a fixed browser page that takes 9 seconds to load on a low res screen or low res tiny screen? Along with trying to learn a new OS versus tapping and moving your fingers.
I live in the US and I have still never seen an iPhone in person. Of course, we don't have AT&T wireless in this area, so that's probably why.
That would explain it.
I've seen a few "in the wild", and I generally don't pay attention.
The Nokia N95 sold 1.5million in the summer quarter. It's in their Q2 financials.
That is a very impressive number. Higher than I would have thought. Although, one should keep in mind that it represents sales volume worldwide (at the moment, the iPhone is available only in four countries).
Does this analyst do standup at The Comedy Store too?
Even going off the most optimistic of the estimates in the article, Apple didn't sell more than 200,000 in it's launch month in Europe, and ongoing it's selling 14,000 a week (at best) in Germany. That's terrible. 2 phones a day in each store.
The Nokia N95 sold 1.5million in the summer quarter. It's in their Q2 financials. There's a banner advert on this very site advertising it as FREE including 8GB, 800 minutes, unlimited texts, GPS data for £40.
LG Prada???? Why would anyone buy that when you can get an LG Viewty for £29?
HTC Touch? - it's a year out of date. Try a Tytan or Touch Dual if you really want a WinMo geek toy or one of the many rebages. If the analyst actually paid attention to the UK market though, WinMo is in single digit territory for phones. We buy Symbian here.
He got one thing right, 3G won't make much difference. You've got to get past the cost of the handset and tariffs first.
Unfortunately, I fear you are right.
And yeah, Apple has got to get the cost and plans in line first (otherwise their foot isn't even in the door), and THEN deal with feature-set issues (3G, MMS) if they want the iPhone to do well long-term in Europe. The rest is just whistling in the dark.
The competition in advanced phones is just stronger over there than in the US, and the level of sophistication/expectations of users over there is higher as well.
Of course, Asia makes even Europe seem a bit like the minor leagues in these respects, and that's the next big market to launch in, only a few months away.
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Get worldwide momentum going with the way the phone works and then release a higher spec model for the Asian release. More than enough time will have passed for the upgrade not to piss people off like the price drop did, and since we'll get the same software upgrade its going to feel like we got new phones.