A mobile phone subscriber has less than a 25% chance of having a PC.
You?re point is flawed. You noted that mobile phone penetration is much higher than PCs, but the iPhone is not in the mobile phone category, it?s in the smartphone and tablets category that account for 5%(?), or 1/5 the number of PCs.
Even if Apple were able to drop the retail price by a couple hundred dollars you?re still talking about a smartphone that costs many times as much as the cheap, dumb phones you refer to in the link.
I'm sticking to the belief that iPhone 5 will come out June/July. It's probably just a way to confuse competitors and make them slow down their product cycles. There's no reason why Apple cannot add A5 chips and some extra ram and put LTE in iPhone 5 by then, especially when a company like HTC can already produce LTE phones.
Those of you who are so hot for LTE haven't read the reviews of the HTC Thunderbolt, for example—it's battery life is abysmal. LTE radios use too much power now for Apple to even consider using them, plus the vast majority of people have no access to LTE and won't for some time to come.
I wonder if all these reports don't represent a confusion. The iPhone 5 will debut around the usual time, but it will be much like the iPhone 4. The focus this year is on the software—iOS5 giving most of the improved capability that people buy new phones for.
Maybe this report of an iPhone being released late in the year, or that picture of the "iPhone" with the curved metal back, represent a new low-cost iPhone—essentially a re-engineered iPhone 3GS—that they could sell a lot cheaper. It would be a real up-to-date usable iPhone, just with less than the latest cutting-edge parts. They could conceivably announce that as "one more thing" at the big iPod blowout in the fall.
Just speculation on my part, but all these conflicting reports seem to me like people are reporting on different things and conflating them.
Those of you who are so hot for LTE haven't read the reviews of the HTC Thunderbolt, for example?it's battery life is abysmal. LTE radios use too much power now for Apple to even consider using them, plus the vast majority of people have no access to LTE and won't for some time to come...
This is true, but I think the arguments for Apple adopting it are based on the assumption that Apple would use the next generation LTE chip, giving more performance for less power etc.
The theory goes that with improvements to battery technology (something Apple is known to be working on), and the better, newer, chip, LTE might become practical all of a sudden. This would give Apple the impression of being the 'first' with LTE (that doesn't kill your battery).
A mobile phone subscriber has less than a 25% chance of having a PC.
I don't buy the idea that those who don't have a PC are on the radar as a future smart phone user any time soon.
If you actually did travel a lot you should understand the great difference in the consumer behavior in US and in the "developing countries" and the market distortion you can observe there, and some other loosely connected weird facts:
A US citizen with $1000 monthly income is very unlikely to be in the market for the current iPhone
A citizen of a "developing country" with $600 monthly income has a very strong potential as an iPhone buyer ( I mean the current models, at the current prices)
Mobile operators are counting as "subscriber" every unique SIM card, no matter pre-paid (actually, the vast majority of the "subscribers") or on contract.
Because of the stupid pricing, many people are carrying more than one mobile phone with SIM cards from different operators.
Data plans are very cheap compared to the US (with data cap though). The carriers can not afford meaningful subsidy because of this. Other factors such as the predominant usage of pre-paid SIM cards, low adoption of credit cards, high piracy (the phone could be jail-broken and actually used on competitor's network) weight in agains meaningful subsidies.
People are much more likely to spend money on status symbols. A phone at $300 has more chances to be desirable status symbol than a $50 or $100 phone.
People are much more likely to buy second-hand items which are still considered a status symbol than newer, better products, with better "specs" and features. For large part of the population there, an old crap barely moving Mercedes or Audi has more appeal than brand new Citroen or Shkoda. If someone could find a way to recycle the old iPhones from the "developed" countries there, that could be a great business!
What I am trying to say is that Apple does not need just "numbers". They are just STARTING to have some brand recognition in the developing countries, and they need to keep that way. There will be more Androids sold as a replacement for a feature phones with their users enjoying mostly the apps bundled by Google and the operator. If Apple gets 5-10% of the market there, that would be a huge number. And that will be the users that matter. The rest may have an Android, but will dream for an iPhone.
I doubt they'll sell it in the US. There are many markets where prepaid phones dominate. Not just developing countries but in some European countries prepaid phones are more popular than contracts. Apple needs to a lower cost phone to compete in those markets. In the US the prepaid market is much smaller so it's not a priority.
Unfortunately, Portugal is a good example of what you said. iPhones just don't sell too much over here. People here aren't big fans of contracts, unless they work at a good company or a bank, and even those have more Blackberries than anything else. Buying an iPhone 4 with no contract in Portugal is just TOO DAMN EXPENSIVE - 589€ for a 16Gb and 689€ for 32Gb. At current rates, that means they cost 850$ and 994$ (US Dollars) respectively…I personally ended up buying an HTC with Android for ONE THIRD of the price…pity it's just not the same thing...and it feels odd, especially when I use my iPod, iMac and MacBook Pro…
EDIT
Funny thing I just checked, an 8Gb iPhone 3GS costs 429€, that's 619$ (US Dollars), my stupid Android HTC was less than half of that...
...The iPhone4 is simply too expensive for the vast majority of people in the world...Here's the amazing thing. Over 5 Billion people have mobile phones, yet only 2 Billion have access to the internet. A developing-country iPhone could be the internet portal for billions of people across the globe. If Steve Jobs wants to change the world, that's where he does it...The most immediate hurdle is the software. The developing-world iPhone can't be a computer peripheral like the current iPhone. It won't be successful if it needs to be tethered to a PC for activation and software updates. It needs to exist autonomously and sync to the cloud. My hope is that this is the reason for the deployment delays. The hardware is relatively easy, but the software is not yet ready.
Very cogent post. But there's already a candidate for such an inexpensive iPhone. It's called the iPod Touch. If a PC were no longer needed for activation, updating and printing, then a Touch would literally be a "pocket computer".
In July I'll be at my early upgrade eligibility and even that has been torturus to wait for, I really hope something is released in the summer, even if it's white iPhone 4. My 3GS is all kinds of beat up. I don't think I could wait till sept or even early 2012
I'm hoping for an update this summer too. I presently have a Samsung Behold 2 on T-Mobile out of contract and have patiently waited to jump to the latest gen iPhone. I too prefer not to buy the iPhone 4 and be stuck with the same device that will be outdated too soon for my green. But I've waited this long a little longer may not hurt unless my Behold craps out on me, then I don't know...
Some how I just don't buy that Apple will put out a no contract iphone. It just does not make sense unless they plan on putting out a non contract iphone 3g. But why would they waste their time and money developing a subpar phone?
Does anyone else have thoughts on how this could be cost effective for Apple here in the US?
This obviously would not be a phone designed for the US market, but for the developing world - ie ASIA where pre-paid is the norm / quite common.
A mobile phone subscriber has less than a 25% chance of having a PC.
What you fail to realize is that they still have access to PC's through work, friends and internet cafes which are abundant. Combined with the pending cloud service, they will be quite capable of backing up and updating their devices on a fairly regular basis by storing all their account info in the cloud instead of on a computer by simply logging in to any computer. And even if you want to look at just that 25%, you are still talking about numbers near a BILLION.
It is becoming obvious that such a delay would mean that big things are in the offing. Although we hate to wait, IMHO the wait will be well worth it, and will once again embarrass the mediocre competition.
A cheaper iPhone is the next growth driver for Apple and absolutely fundamental to their future. The iPhone4 is simply too expensive for the vast majority of people in the world. If I recall correctly, the average sell price of an iPhone is over $600. It's the best phone in the world, but it's priced for the wealthiest 10%. If Apple is going to continue their phenomenal growth then they will need to field a product for the next 50% of the market.
You say the iPhone is expensive... but people bought 16,000,000 iPhones last quarter. Yeah $600 is expensive... but Apple has no problem selling them. I know growth is important... but they had $10 Billion in sales last quarter. Any other company would kill for that.
Maybe Apple is going for a more "Mac" approach with the iPhone. The Macintosh will never beat Windows in market share... and it's not growing that much in terms of PC sales overall... but I don't think Apple has any plans to discontinue the Mac because of "low" sales.
Apple doesn't make a $299 computer... and I don't think Apple wants to tarnish their brand by pumping out a bunch of garbage phones either (and brand is VERY important to Apple)
Sure... Apple could make a $200 phone for emerging markets (but margins are also important to Apple)
The 3GS is still going for $449 retail... how low can Apple go?
A cheaper iPhone is the next growth driver for Apple and absolutely fundamental to their future. The iPhone4 is simply too expensive for the vast majority of people in the world. If I recall correctly, the average sell price of an iPhone is over $600. It's the best phone in the world, but it's priced for the wealthiest 10%. If Apple is going to continue their phenomenal growth then they will need to field a product for the next 50% of the market.
While I am not ruling out the possibility of there being a lower-cost model of iPhone in the future, I don't think the time for it has come yet. There are many folks in these developing countries that clamor for, and have the ability to purchase, an iPhone and/or iPad.
This is also why I believe the rumors of a fall introduction for the iPhone 5. With the iPhone 4 still selling so well, and the focus on the iPad 2 now, there is no reason to distract consumers in June.
The halo effect is very real, folks. Especially between the iPhone and iPad (in both directions).
You say the iPhone is expensive... but people bought 16,000,000 iPhones last quarter. Yeah $600 is expensive... but Apple has no problem selling them. I know growth is important... but they had $10 Billion in sales last quarter. Any other company would kill for that.
Maybe Apple is going for a more "Mac" approach with the iPhone. The Macintosh will never beat Windows in market share... and it's not growing that much in terms of PC sales overall... but I don't think Apple has any plans to discontinue the Mac because of "low" sales.
Apple doesn't make a $299 computer... and I don't think Apple wants to tarnish their brand by pumping out a bunch of garbage phones either (and brand is VERY important to Apple)
Sure... Apple could make a $200 phone for emerging markets (but margins are also important to Apple)
Couldn't agree more with what you said. Also, it's not a good idea to introduce a lower-cost product when the demand for the existing premium products cannot be satisified.
If you actually did travel a lot you should understand the great difference in the consumer behavior in US and in the "developing countries" and the market distortion you can observe there, and some other loosely connected weird facts:
A US citizen with $1000 monthly income is very unlikely to be in the market for the current iPhone
A citizen of a "developing country" with $600 monthly income has a very strong potential as an iPhone buyer ( I mean the current models, at the current prices)
This is probably the biggest difference. Many folks in western countries make the incorrect assumption that consumers of these so-called developing countries are equivalent to the poor class of western society.
Quote:
Originally Posted by shadow
Mobile operators are counting as "subscriber" every unique SIM card, no matter pre-paid (actually, the vast majority of the "subscribers") or on contract.
Because of the stupid pricing, many people are carrying more than one mobile phone with SIM cards from different operators.
Correct. In fact, a certain landline operator is giving away a 3G (CDMA) handset when you sign up for a landline account (the monthly minutes are pooled between the landline and handset). And some folks here carry a GSM + CDMA dual-SIM phone instead of two separate handsets.
Quote:
Originally Posted by shadow
People are much more likely to spend money on status symbols. A phone at $300 has more chances to be desirable status symbol than a $50 or $100 phone.
Very, very true. Folks here want to show off that they are not "poor", even if it means spending a month or two of their salary on a hot gadget.
Quote:
Originally Posted by shadow
People are much more likely to buy second-hand items which are still considered a status symbol than newer, better products, with better "specs" and features. For large part of the population there, an old crap barely moving Mercedes or Audi has more appeal than brand new Citroen or Shkoda. If someone could find a way to recycle the old iPhones from the "developed" countries there, that could be a great business!
Not true in China - people here that can afford it, want to buy new. This goes for apartments, cars, gadgets, wives, etc. There is some sort of stigma against buying second-hand goods here. Though I do agree that second-hand iPhones would sell very well here.
Quote:
Originally Posted by shadow
What I am trying to say is that Apple does not need just "numbers". They are just STARTING to have some brand recognition in the developing countries, and they need to keep that way. There will be more Androids sold as a replacement for a feature phones with their users enjoying mostly the apps bundled by Google and the operator. If Apple gets 5-10% of the market there, that would be a huge number. And that will be the users that matter. The rest may have an Android, but will dream for an iPhone.
Apple has reached a tipping point in China. I see no need for a low-cost product right now. Nokia, Sony-Ericsson, Samsung, LG have been selling low-cost models for years over here - how are they doing now? Apple just needs to continue focusing on the middle and upper class here and they will do very well.
After giving this some thought for a couple days, I won't be surprised really if Apple delays the next iPhone.
Apple has been steady and thoughtful with the iPhone's development so far. Rather than racing to be the first with features, they've been more concerned with being the first to get them right. What I think has happened in the last few months is the speed of improvements on the "other" platform have perhaps caught Apple a little off-guard. Features that Apple likely has planned for the next gen phone may not be as unique or new as they had anticipated. Now more than ever they need to have everything they do include working as it should, and at least as good or better than the competition offers. When the iPhone 4 launched, there was little that stood up to even the 3GS. That's no longer the case. There's some pretty dang good Android phones available, and from several different manufacturers. It's just not the same playing field as it was even 6 months ago. Apple's wise to take their time with the iPhone5 (assuming the rumor is true). It's Apple's only entry for the next year and needs to look like the premium market leader in February 2012 as much as it does at launch.
I agree with some of the earlier posts regarding how Apple shouldn't come out with a lower cost iPhone at risk of ruining the brand equity of the iPhone. People buy it because it is a luxury and (as mentioned earlier) a symbol. A cheaper model would make it more competitive in other developing markets, but also ruin the standard and symbol Apple has created. The iPhone 4 is rad and shouldn't be downgraded.
Comments
China, India, Nepal, Peru, Cambodia, Thailand, much of Eastern Europe...
I assume from your quip that you believe I underestimate the markey penetration of PCs in the developing world.
Here's a chart that compares mobile phone vs. PC market penetration.
http://www.businessinsider.com/chart...uld-get-2011-3
A mobile phone subscriber has less than a 25% chance of having a PC.
You?re point is flawed. You noted that mobile phone penetration is much higher than PCs, but the iPhone is not in the mobile phone category, it?s in the smartphone and tablets category that account for 5%(?), or 1/5 the number of PCs.
Even if Apple were able to drop the retail price by a couple hundred dollars you?re still talking about a smartphone that costs many times as much as the cheap, dumb phones you refer to in the link.
I wonder if all these reports don't represent a confusion. The iPhone 5 will debut around the usual time, but it will be much like the iPhone 4. The focus this year is on the software—iOS5 giving most of the improved capability that people buy new phones for.
Maybe this report of an iPhone being released late in the year, or that picture of the "iPhone" with the curved metal back, represent a new low-cost iPhone—essentially a re-engineered iPhone 3GS—that they could sell a lot cheaper. It would be a real up-to-date usable iPhone, just with less than the latest cutting-edge parts. They could conceivably announce that as "one more thing" at the big iPod blowout in the fall.
Just speculation on my part, but all these conflicting reports seem to me like people are reporting on different things and conflating them.
Those of you who are so hot for LTE haven't read the reviews of the HTC Thunderbolt, for example?it's battery life is abysmal. LTE radios use too much power now for Apple to even consider using them, plus the vast majority of people have no access to LTE and won't for some time to come...
This is true, but I think the arguments for Apple adopting it are based on the assumption that Apple would use the next generation LTE chip, giving more performance for less power etc.
The theory goes that with improvements to battery technology (something Apple is known to be working on), and the better, newer, chip, LTE might become practical all of a sudden. This would give Apple the impression of being the 'first' with LTE (that doesn't kill your battery).
China, India, Nepal, Peru, Cambodia, Thailand, much of Eastern Europe...
I assume from your quip that you believe I underestimate the markey penetration of PCs in the developing world.
Here's a chart that compares mobile phone vs. PC market penetration.
http://www.businessinsider.com/chart...uld-get-2011-3
A mobile phone subscriber has less than a 25% chance of having a PC.
I don't buy the idea that those who don't have a PC are on the radar as a future smart phone user any time soon.
If you actually did travel a lot you should understand the great difference in the consumer behavior in US and in the "developing countries" and the market distortion you can observe there, and some other loosely connected weird facts:
- A US citizen with $1000 monthly income is very unlikely to be in the market for the current iPhone
- A citizen of a "developing country" with $600 monthly income has a very strong potential as an iPhone buyer ( I mean the current models, at the current prices)
- Mobile operators are counting as "subscriber" every unique SIM card, no matter pre-paid (actually, the vast majority of the "subscribers") or on contract.
- Because of the stupid pricing, many people are carrying more than one mobile phone with SIM cards from different operators.
- Data plans are very cheap compared to the US (with data cap though). The carriers can not afford meaningful subsidy because of this. Other factors such as the predominant usage of pre-paid SIM cards, low adoption of credit cards, high piracy (the phone could be jail-broken and actually used on competitor's network) weight in agains meaningful subsidies.
- People are much more likely to spend money on status symbols. A phone at $300 has more chances to be desirable status symbol than a $50 or $100 phone.
- People are much more likely to buy second-hand items which are still considered a status symbol than newer, better products, with better "specs" and features. For large part of the population there, an old crap barely moving Mercedes or Audi has more appeal than brand new Citroen or Shkoda. If someone could find a way to recycle the old iPhones from the "developed" countries there, that could be a great business!
What I am trying to say is that Apple does not need just "numbers". They are just STARTING to have some brand recognition in the developing countries, and they need to keep that way. There will be more Androids sold as a replacement for a feature phones with their users enjoying mostly the apps bundled by Google and the operator. If Apple gets 5-10% of the market there, that would be a huge number. And that will be the users that matter. The rest may have an Android, but will dream for an iPhone.A cheaper iPhone is the next growth driver for Apple and absolutely fundamental to their future...
Excellent post! Welcome to AI.
I doubt they'll sell it in the US. There are many markets where prepaid phones dominate. Not just developing countries but in some European countries prepaid phones are more popular than contracts. Apple needs to a lower cost phone to compete in those markets. In the US the prepaid market is much smaller so it's not a priority.
Unfortunately, Portugal is a good example of what you said. iPhones just don't sell too much over here. People here aren't big fans of contracts, unless they work at a good company or a bank, and even those have more Blackberries than anything else. Buying an iPhone 4 with no contract in Portugal is just TOO DAMN EXPENSIVE - 589€ for a 16Gb and 689€ for 32Gb. At current rates, that means they cost 850$ and 994$ (US Dollars) respectively…I personally ended up buying an HTC with Android for ONE THIRD of the price…pity it's just not the same thing...and it feels odd, especially when I use my iPod, iMac and MacBook Pro…
EDIT
Funny thing I just checked, an 8Gb iPhone 3GS costs 429€, that's 619$ (US Dollars), my stupid Android HTC was less than half of that...
...The iPhone4 is simply too expensive for the vast majority of people in the world...Here's the amazing thing. Over 5 Billion people have mobile phones, yet only 2 Billion have access to the internet. A developing-country iPhone could be the internet portal for billions of people across the globe. If Steve Jobs wants to change the world, that's where he does it...The most immediate hurdle is the software. The developing-world iPhone can't be a computer peripheral like the current iPhone. It won't be successful if it needs to be tethered to a PC for activation and software updates. It needs to exist autonomously and sync to the cloud. My hope is that this is the reason for the deployment delays. The hardware is relatively easy, but the software is not yet ready.
Very cogent post. But there's already a candidate for such an inexpensive iPhone. It's called the iPod Touch. If a PC were no longer needed for activation, updating and printing, then a Touch would literally be a "pocket computer".
In July I'll be at my early upgrade eligibility and even that has been torturus to wait for, I really hope something is released in the summer, even if it's white iPhone 4. My 3GS is all kinds of beat up. I don't think I could wait till sept or even early 2012
I'm hoping for an update this summer too. I presently have a Samsung Behold 2 on T-Mobile out of contract and have patiently waited to jump to the latest gen iPhone. I too prefer not to buy the iPhone 4 and be stuck with the same device that will be outdated too soon for my green. But I've waited this long a little longer may not hurt unless my Behold craps out on me, then I don't know...
Some how I just don't buy that Apple will put out a no contract iphone. It just does not make sense unless they plan on putting out a non contract iphone 3g. But why would they waste their time and money developing a subpar phone?
Does anyone else have thoughts on how this could be cost effective for Apple here in the US?
This obviously would not be a phone designed for the US market, but for the developing world - ie ASIA where pre-paid is the norm / quite common.
China, India, Nepal, Peru, Cambodia, Thailand, much of Eastern Europe...
I assume from your quip that you believe I underestimate the markey penetration of PCs in the developing world.
Here's a chart that compares mobile phone vs. PC market penetration.
http://www.businessinsider.com/chart...uld-get-2011-3
A mobile phone subscriber has less than a 25% chance of having a PC.
What you fail to realize is that they still have access to PC's through work, friends and internet cafes which are abundant. Combined with the pending cloud service, they will be quite capable of backing up and updating their devices on a fairly regular basis by storing all their account info in the cloud instead of on a computer by simply logging in to any computer. And even if you want to look at just that 25%, you are still talking about numbers near a BILLION.
A cheaper iPhone is the next growth driver for Apple and absolutely fundamental to their future. The iPhone4 is simply too expensive for the vast majority of people in the world. If I recall correctly, the average sell price of an iPhone is over $600. It's the best phone in the world, but it's priced for the wealthiest 10%. If Apple is going to continue their phenomenal growth then they will need to field a product for the next 50% of the market.
You say the iPhone is expensive... but people bought 16,000,000 iPhones last quarter. Yeah $600 is expensive... but Apple has no problem selling them. I know growth is important... but they had $10 Billion in sales last quarter. Any other company would kill for that.
Maybe Apple is going for a more "Mac" approach with the iPhone. The Macintosh will never beat Windows in market share... and it's not growing that much in terms of PC sales overall... but I don't think Apple has any plans to discontinue the Mac because of "low" sales.
Apple doesn't make a $299 computer... and I don't think Apple wants to tarnish their brand by pumping out a bunch of garbage phones either (and brand is VERY important to Apple)
Sure... Apple could make a $200 phone for emerging markets (but margins are also important to Apple)
The 3GS is still going for $449 retail... how low can Apple go?
A cheaper iPhone is the next growth driver for Apple and absolutely fundamental to their future. The iPhone4 is simply too expensive for the vast majority of people in the world. If I recall correctly, the average sell price of an iPhone is over $600. It's the best phone in the world, but it's priced for the wealthiest 10%. If Apple is going to continue their phenomenal growth then they will need to field a product for the next 50% of the market.
While I am not ruling out the possibility of there being a lower-cost model of iPhone in the future, I don't think the time for it has come yet. There are many folks in these developing countries that clamor for, and have the ability to purchase, an iPhone and/or iPad.
For example, here in China the iPhone 4 is still sold out - http://store.apple.com/cn/browse/hom.../family/iphone
This is also why I believe the rumors of a fall introduction for the iPhone 5. With the iPhone 4 still selling so well, and the focus on the iPad 2 now, there is no reason to distract consumers in June.
The halo effect is very real, folks. Especially between the iPhone and iPad (in both directions).
You say the iPhone is expensive... but people bought 16,000,000 iPhones last quarter. Yeah $600 is expensive... but Apple has no problem selling them. I know growth is important... but they had $10 Billion in sales last quarter. Any other company would kill for that.
Maybe Apple is going for a more "Mac" approach with the iPhone. The Macintosh will never beat Windows in market share... and it's not growing that much in terms of PC sales overall... but I don't think Apple has any plans to discontinue the Mac because of "low" sales.
Apple doesn't make a $299 computer... and I don't think Apple wants to tarnish their brand by pumping out a bunch of garbage phones either (and brand is VERY important to Apple)
Sure... Apple could make a $200 phone for emerging markets (but margins are also important to Apple)
Couldn't agree more with what you said. Also, it's not a good idea to introduce a lower-cost product when the demand for the existing premium products cannot be satisified.
If you actually did travel a lot you should understand the great difference in the consumer behavior in US and in the "developing countries" and the market distortion you can observe there, and some other loosely connected weird facts:
This is probably the biggest difference. Many folks in western countries make the incorrect assumption that consumers of these so-called developing countries are equivalent to the poor class of western society.
Correct. In fact, a certain landline operator is giving away a 3G (CDMA) handset when you sign up for a landline account (the monthly minutes are pooled between the landline and handset). And some folks here carry a GSM + CDMA dual-SIM phone instead of two separate handsets.
Very, very true. Folks here want to show off that they are not "poor", even if it means spending a month or two of their salary on a hot gadget.
Not true in China - people here that can afford it, want to buy new. This goes for apartments, cars, gadgets, wives, etc. There is some sort of stigma against buying second-hand goods here. Though I do agree that second-hand iPhones would sell very well here.
What I am trying to say is that Apple does not need just "numbers". They are just STARTING to have some brand recognition in the developing countries, and they need to keep that way. There will be more Androids sold as a replacement for a feature phones with their users enjoying mostly the apps bundled by Google and the operator. If Apple gets 5-10% of the market there, that would be a huge number. And that will be the users that matter. The rest may have an Android, but will dream for an iPhone.
Apple has reached a tipping point in China. I see no need for a low-cost product right now. Nokia, Sony-Ericsson, Samsung, LG have been selling low-cost models for years over here - how are they doing now? Apple just needs to continue focusing on the middle and upper class here and they will do very well.
Apple has been steady and thoughtful with the iPhone's development so far. Rather than racing to be the first with features, they've been more concerned with being the first to get them right. What I think has happened in the last few months is the speed of improvements on the "other" platform have perhaps caught Apple a little off-guard. Features that Apple likely has planned for the next gen phone may not be as unique or new as they had anticipated. Now more than ever they need to have everything they do include working as it should, and at least as good or better than the competition offers. When the iPhone 4 launched, there was little that stood up to even the 3GS. That's no longer the case. There's some pretty dang good Android phones available, and from several different manufacturers. It's just not the same playing field as it was even 6 months ago. Apple's wise to take their time with the iPhone5 (assuming the rumor is true). It's Apple's only entry for the next year and needs to look like the premium market leader in February 2012 as much as it does at launch.