The iPod Nano and the iPod Touch are different products, under every possible aspect. Abell is clear on that: different technology (one has a big screen and is powered by iOS and so on), different occasions of use (one is just for music, ideal for running and so on; the other one is a "complete media device", able of running apps and games, browsing the Internet, and so on) and, mostly important, different target customers.
Some people buy both an iPod Nano (that they use when practicing sports, for example) and an iPod Touch (to be used for all its functions).
You can't do that with an iPhone. At least, not as long as you run it with iOS (and the whole purpose of creating a mass iPhone is for increasing the market share of iOS).
Why can't you do it with a phone and iOS?
Apple took the same OS and used it in the iPhone 4 and 5 and the iPod Touch, and the previous iPod Touch, and modified it for the Apple TV. In a more extreme fashion Android is used in a crazy number of different phones with different capabilities?
In the first months, sales would likely explode. But then, when the product becomes mass, it will lose its appeal. Apple would be perceived just like "another phone manufacturer", just like Samsung (if you asked somebody who owns a Samsung phone why they bought it, they may answer "because it's a good phone", but they are unlikely to say "because it's a Samsung", unless they are implying with that a reference to the intrinsic quality of the product, not the brand).
I know of people who would answer to this question.
"Because it's not an iphone."
The sad part is, that there is almost nothing more mainstream than owning an iphone. So it's almost exclusive to not own one. There are some people out there that buy other smartphones instead of an iphone because
"owning an iphone is too mainstream."
SJ also said a smaller tablet form factor doesn't make sense (sanding fingers etc.) yet the iPad mini was made and is selling like crazy. I'm not a business analyst so I have no idea if a cheap iPhone is a smart business move or not but I'm sure they would sell tens of millions. I really don't see the problem of giving users a choice of a premium iPhone or a cheap iPhone. Doesn't bother me at all.
The difference is the iPad mini is not a cheap tablet. They did not do what the analyst and so called experts expected and release a $199-$249 price point cheap tablet to compete with Kindle Fire and Nexus on price. Plus the form factor is completely different than other small tablets. They found a way to make a premium small tablet. It fits the Apple brand perfectly. A cheap iPhone to try to compete in emerging markets does not match the Apple way of doing things at all.
It's not a firm denial but I don't see a separate product being developed. The 4, 4S, and 5 will continue to be sold when the next version comes out. The 4 is still a great phone for emerging markets if that's what people keep coming up with. It won't have SIRI and some current iOS features but it can handle mostly every app. Why can't that be good enough? There's no point in having a newly-developed $350 off contract 8 GB iPhone being sold alongside a newly-developed $650 off contract 16 GB iPhone. I don't see a conceivable way to limit the iPhone Mini or whatever where it doesn't cannibalize the iPhone in 1st World Countries while also being economically viable in developing nations. This is not the same as the iPad --> iPad Mini. A person could buy an iPad for home and an iPad Mini for travel. They do serve two distinct purposes (I have both). Unless the iPhone Mini is bastardized to 8 GB as a new product I don't see it happening.
Apple took the same OS and used it in the iPhone 4 and 5 and the iPod Touch, and the previous iPod Touch, and modified it for the Apple TV. In a more extreme fashion Android is used in a crazy number of different phones with different capabilities?
The Apple TV doesn't run iOS apps. It runs iOS probably just for "simplicity"...
You can't do it with a phone and iOS because that would be an iPhone.
Since Apple is already making LOTS of profits, their only interest in incrementing the market share of their phone is for the positive impact of the ecosystem. That is: the more iPhone users outside, the more and better apps, and this generates a positive feedback. As you can see, it's not about increasing the market share of the device itself, but of the operating system.
Because of this, their answer to the problem was clever.
First of all, there is the iPod Touch, which can be bought by children as well and also helps with a "lock-in" effect.
Second, they keep selling older models, for those who want an iPhone but can't afford it. In this way, they are not diluting the brand value, because everyone would still buy the newest model if they could.
An Apple-made phone without iOS not only would be useless to the purpose of maximizing the market share of the operating system, but would instead cannibalize the iPhone itself (which runs iOS).
An Apple-made phone with iOS would instead diluite the brand value and so on, as I explained above.
Quote:
Originally Posted by changeover
I know of people who would answer to this question.
"Because it's not an iphone."
The sad part is, that there is almost nothing more mainstream than owning an iphone. So it's almost exclusive to not own one. There are some people out there that buy other smartphones instead of an iphone because
"owning an iphone is too mainstream."
"Because it's not an iPhone" just reinforces my thesis. A critical success factor of the iPhone is that it is an iPhone. So people buy or DON'T buy exactly because it's an iPhone!
Instead, it's hard to hear someone who admits he buys or doesn't buy a phone because it's a Samsung...
(By the way, in the past Nokia was probably in the same situation: people were buying Nokia phones just because they were made by Nokia: the brand was really the conditio sine qua non in this case).
Why not make a 3G only, 3.5" display, 5 megapixel, 16GB-only, A6-powered (512MB), Lightning-connected ultrathin replacement for the iPhone 4S for release later this year alongside the 5S. US$249 no contract unlocked. Call it iPhone mini.
The lack of size options, no LTE, different camera and no 4.0 inch display would prevent cannibalisation of the iPhone 5S. Using parts long in manufacture makes it cheap to make, but it brings iOS, and an ultrathin aluminum form factor to this segment of the market.
It would replace the iPhone 4 and 4S as the low end model and bring Lightning to all iPhone models. Never sold carrier locked, like the iPad cellular to keep inventory simple.
Apple can make fantastic ultra thin devices at low cost (iPod touch). I think this would be the way to go.
So not 'cheap', but I do think that a better value iPhone may be on the way.
It's mainly because of the greater divergence in design within the smartphone category as a whole. In particular there are lots of larger smartphones about withbigger screens. I wouldn't want one myself. I've not bought an iPhone 5 because I prefer the 4S size and proportions and I'm still very happy with it. But clearly lots of people do want larger smartphones. I don't see Apple being able to compete effectively in a divergent class with a single model.
In other categories Apple offers different sizes and price points - I see no reason why they shouldn't with iPhones.
Want a MacBook Air? Mine's a 11" but some people seem to prefer 13". Neither is 'cheap' . Both are quality. But one costs less than the other.
"Because it's not an iPhone" just reinforces my thesis. A critical success factor of the iPhone is that it is an iPhone. So people buy or DON'T buy exactly because it's an iPhone!
Instead, it's hard to hear someone who admits he buys or doesn't buy a phone because it's a Samsung...
(By the way, in the past Nokia was probably in the same situation: people were buying Nokia phones just because they were made by Nokia: the brand was really the conditio sine qua non in this case).
I never looked it that way. But that makes sense.
But i wouldn't compare apple and nokia. Look where nokia is right now. I don't think that is going to happen to apple.
Why not make a 3G only, 3.5" display, 5 megapixel, 16GB-only, A6-powered (512MB), Lightning-connected ultrathin replacement for the iPhone 4S for release later this year alongside the 5S. US$249 no contract unlocked. Call it iPhone mini.
The lack of size options, no LTE, different camera and no 4.0 inch display would prevent cannibalisation of the iPhone 5S. Using parts long in manufacture makes it cheap to make, but it brings iOS, and an ultrathin aluminum form factor to this segment of the market.
It would replace the iPhone 4 and 4S as the low end model and bring Lightning to all iPhone models. Never sold carrier locked, like the iPad cellular to keep inventory simple.
Apple can make fantastic ultra thin devices at low cost (iPod touch). I think this would be the way to go.
I think if a less expensive iPhone is to be made it will follow along the lines you state but be for China Mobile. Most of their customers are still on 2G, and their 3G is homegrown, with LTE not reasonable for at least a few years by my estimate.
Apple does make cheap iPhones, it just does not sell them direct to consumers!
Every time Apple release the next generation iPhone a whole raft of previous generation phones move through the supply system - I know I've passed at least two generation to friends and family for considerably less than the original retail price.
Perhaps this is one of the best reasons for Apple to maintain iOS compatibility through iOS device generation, which generally is very good.
Given market figures for handsets, our website stats for clients show iOS devices still dominate over 60% of the engagement with websites.
If Apple were going to make a new smaller or larger iPhone I doubt they would admit it. They were denying the iPhone, iPad, then the iPad mini right up until they were released as well. This will not stop any rumors.
I am not saying this rumor is likely or credible, but an Apple denial doesn't really come close to putting a stop to them either.
I agree, High-margin profit isn't everything. I've said this in several other threads this week.
You can make all the profit in the world, but with smaller adoption rates you loose regardless of how much money you've made.
That being said, it's been shown in many articles that iPhone users generate a majority of mobile use/web traffic. So Apple certainly hasn't got a lot to worry about...YET. But I am worried every time I see the market share dropping.
Or you can say Apple is in 2nd place in market share to Android. Does that sound better?
Sure it's a distant 2nd place... but so what? Apple makes more than enough money to survive. And not just survive... they make an obscene amount of money for "only" being 2nd place. Apple is probably further from bankruptcy than any other company on the planet.
Market share is a ranking of all products in an entire industry. Unfortunately... you cannot pay your bills with market share.
If you owned a restaurant in your town... would you be more concerned with how many meals you sell compared to all other restaurants in your town?
No... because you cannot pay your rent with some chart listing the number of meals you sell. You have to make actual money to keep your doors open.
Market share is an "award" while profit is the "reward"
Thank you for putting this rumor to bed. I was dreading a cheap iPhone. Apple is a quality brand and it should always stay that way. If you want cheap Samsung and the others are waiting for you're money
The tablets SJ was talking about were the 16:9 7" variety like the Nexus 7 and smaller kindle.
The iPad Mini is a 4:3 7.9" tablet that has 34% more screen area than the 16:9 7"ers. 34% is immediately noticeable when you hold them side by side.
SJ's original quote said nothing about 16:9 aspect ratio. He said the minimum screen size should be 10 inches. How does that garbage taste? Anyways, the point I was trying to make is just because an Apple exec says something like Phil Schiller did about a cheap iPhone doesn't mean Apple will never build it (the iPad mini being a perfect example of this). BTW I love the iPad mini but will wait for the Retina version.
Steve's original quote:
While one could increase the resolution to make up some of the difference, it is meaningless unless your tablet also includes sandpaper, so that the user can sand down their fingers to around one-quarter of their present size. Apple has done expensive user testing on touch interfaces over many years, and we really understand this stuff.
There are clear limits of how close you can place physical elements on a touch screen, before users cannot reliably tap, flick or pinch them. This is one of the key reasons we think the 10-inch screen size is the minimum size required to create great tablet apps.
Apple does make cheap iPhones, it just does not sell them direct to consumers!
Every time Apple release the next generation iPhone a whole raft of previous generation phones move through the supply system - I know I've passed at least two generation to friends and family for considerably less than the original retail price.
Perhaps this is one of the best reasons for Apple to maintain iOS compatibility through iOS device generation, which generally is very good.
Given market figures for handsets, our website stats for clients show iOS devices still dominate over 60% of the engagement with websites.
I caution your use of the word, "cheap". Whenever people post about price (cheap or expensive) it's vital to specify what it buys...does that cheap cost include the total cost of ownership (i.e. data plan)? A $0.99 iPhone in the U.S. requires a fairly expensive 2 year data plan.
Is it considerably less than a new iPhone?...yes. But it's still not considered cheap to most.
Therefore, it has always been my contention that a different form factor (like an iPod nano but with a phone) which results in cheaper data plans is the most probably direction that Apple will take. Unless major networks dramatically bring down the cost of GB of data, every iPhone from the 3GS to 5 is still relatively expensive.
Further, an iPod nano-like phone reaches an audience very different from the existing iPhone market. The hardware will be cheaper than an iPhone and the data plans will be cheaper as well.
Why don't people understand you don't have to be a volume dealer to be a success apple is a luxury brand. It's not dell or Samsung
How is apple not a volume dealer? They sell millions of devices each month. That's pretty volume to me.
I can see that people would like to see apple as a luxury brand to make them feel better about themselves. For me a luxury brand is not only defined by lacking lower-mid-end products but also of the limit number of a certain product.
So for me, apple isn't a luxury brand as for example a ferrari is (you don't see many ferraris around do you?).
Comments
Why can't you do it with a phone and iOS?
Apple took the same OS and used it in the iPhone 4 and 5 and the iPod Touch, and the previous iPod Touch, and modified it for the Apple TV. In a more extreme fashion Android is used in a crazy number of different phones with different capabilities?
I know of people who would answer to this question.
"Because it's not an iphone."
The sad part is, that there is almost nothing more mainstream than owning an iphone. So it's almost exclusive to not own one. There are some people out there that buy other smartphones instead of an iphone because
"owning an iphone is too mainstream."
Quote:
Originally Posted by GadgetCanada
SJ also said a smaller tablet form factor doesn't make sense (sanding fingers etc.) yet the iPad mini was made and is selling like crazy. I'm not a business analyst so I have no idea if a cheap iPhone is a smart business move or not but I'm sure they would sell tens of millions. I really don't see the problem of giving users a choice of a premium iPhone or a cheap iPhone. Doesn't bother me at all.
The difference is the iPad mini is not a cheap tablet. They did not do what the analyst and so called experts expected and release a $199-$249 price point cheap tablet to compete with Kindle Fire and Nexus on price. Plus the form factor is completely different than other small tablets. They found a way to make a premium small tablet. It fits the Apple brand perfectly. A cheap iPhone to try to compete in emerging markets does not match the Apple way of doing things at all.
That and the fact Jobs was quite specific in his comment that the current lot of 7" iPads are DOA.
Note he didn't state that all 7" tablets no matter when they are produced, what aspect ratio or within 1" of 7 inches would be DOA.
It's not a firm denial but I don't see a separate product being developed. The 4, 4S, and 5 will continue to be sold when the next version comes out. The 4 is still a great phone for emerging markets if that's what people keep coming up with. It won't have SIRI and some current iOS features but it can handle mostly every app. Why can't that be good enough? There's no point in having a newly-developed $350 off contract 8 GB iPhone being sold alongside a newly-developed $650 off contract 16 GB iPhone. I don't see a conceivable way to limit the iPhone Mini or whatever where it doesn't cannibalize the iPhone in 1st World Countries while also being economically viable in developing nations. This is not the same as the iPad --> iPad Mini. A person could buy an iPad for home and an iPad Mini for travel. They do serve two distinct purposes (I have both). Unless the iPhone Mini is bastardized to 8 GB as a new product I don't see it happening.
Quote:
Originally Posted by Slicksim
Why can't you do it with a phone and iOS?
Apple took the same OS and used it in the iPhone 4 and 5 and the iPod Touch, and the previous iPod Touch, and modified it for the Apple TV. In a more extreme fashion Android is used in a crazy number of different phones with different capabilities?
The Apple TV doesn't run iOS apps. It runs iOS probably just for "simplicity"...
You can't do it with a phone and iOS because that would be an iPhone.
Since Apple is already making LOTS of profits, their only interest in incrementing the market share of their phone is for the positive impact of the ecosystem. That is: the more iPhone users outside, the more and better apps, and this generates a positive feedback. As you can see, it's not about increasing the market share of the device itself, but of the operating system.
Because of this, their answer to the problem was clever.
First of all, there is the iPod Touch, which can be bought by children as well and also helps with a "lock-in" effect.
Second, they keep selling older models, for those who want an iPhone but can't afford it. In this way, they are not diluting the brand value, because everyone would still buy the newest model if they could.
An Apple-made phone without iOS not only would be useless to the purpose of maximizing the market share of the operating system, but would instead cannibalize the iPhone itself (which runs iOS).
An Apple-made phone with iOS would instead diluite the brand value and so on, as I explained above.
Quote:
Originally Posted by changeover
I know of people who would answer to this question.
"Because it's not an iphone."
The sad part is, that there is almost nothing more mainstream than owning an iphone. So it's almost exclusive to not own one. There are some people out there that buy other smartphones instead of an iphone because
"owning an iphone is too mainstream."
"Because it's not an iPhone" just reinforces my thesis. A critical success factor of the iPhone is that it is an iPhone. So people buy or DON'T buy exactly because it's an iPhone!
Instead, it's hard to hear someone who admits he buys or doesn't buy a phone because it's a Samsung...
(By the way, in the past Nokia was probably in the same situation: people were buying Nokia phones just because they were made by Nokia: the brand was really the conditio sine qua non in this case).
The lack of size options, no LTE, different camera and no 4.0 inch display would prevent cannibalisation of the iPhone 5S. Using parts long in manufacture makes it cheap to make, but it brings iOS, and an ultrathin aluminum form factor to this segment of the market.
It would replace the iPhone 4 and 4S as the low end model and bring Lightning to all iPhone models. Never sold carrier locked, like the iPad cellular to keep inventory simple.
Apple can make fantastic ultra thin devices at low cost (iPod touch). I think this would be the way to go.
So not 'cheap', but I do think that a better value iPhone may be on the way.
It's mainly because of the greater divergence in design within the smartphone category as a whole. In particular there are lots of larger smartphones about withbigger screens. I wouldn't want one myself. I've not bought an iPhone 5 because I prefer the 4S size and proportions and I'm still very happy with it. But clearly lots of people do want larger smartphones. I don't see Apple being able to compete effectively in a divergent class with a single model.
In other categories Apple offers different sizes and price points - I see no reason why they shouldn't with iPhones.
Want a MacBook Air? Mine's a 11" but some people seem to prefer 13". Neither is 'cheap' . Both are quality. But one costs less than the other.
But i wouldn't compare apple and nokia. Look where nokia is right now. I don't think that is going to happen to apple.
I think if a less expensive iPhone is to be made it will follow along the lines you state but be for China Mobile. Most of their customers are still on 2G, and their 3G is homegrown, with LTE not reasonable for at least a few years by my estimate.
Quote:
Originally Posted by changeover
I never looked it that way. But that makes sense.
But i wouldn't compare apple and nokia. Look where nokia is right now. I don't think that is going to happen to apple.
In terms of brand equity, Nokia had, in the mobile phones industry, the position that is held by Apple today (at least here in Europe).
Then, they failed because of many, big strategical issues... And there are lots of studies on that. But that's a whole other story
Every time Apple release the next generation iPhone a whole raft of previous generation phones move through the supply system - I know I've passed at least two generation to friends and family for considerably less than the original retail price.
Perhaps this is one of the best reasons for Apple to maintain iOS compatibility through iOS device generation, which generally is very good.
Given market figures for handsets, our website stats for clients show iOS devices still dominate over 60% of the engagement with websites.
If Apple were going to make a new smaller or larger iPhone I doubt they would admit it. They were denying the iPhone, iPad, then the iPad mini right up until they were released as well. This will not stop any rumors.
I am not saying this rumor is likely or credible, but an Apple denial doesn't really come close to putting a stop to them either.
Or you can say Apple is in 2nd place in market share to Android. Does that sound better?
Sure it's a distant 2nd place... but so what? Apple makes more than enough money to survive. And not just survive... they make an obscene amount of money for "only" being 2nd place. Apple is probably further from bankruptcy than any other company on the planet.
Market share is a ranking of all products in an entire industry. Unfortunately... you cannot pay your bills with market share.
If you owned a restaurant in your town... would you be more concerned with how many meals you sell compared to all other restaurants in your town?
No... because you cannot pay your rent with some chart listing the number of meals you sell. You have to make actual money to keep your doors open.
Market share is an "award" while profit is the "reward"
Quote:
Originally Posted by slickdealer
Complete garbage.
The tablets SJ was talking about were the 16:9 7" variety like the Nexus 7 and smaller kindle.
The iPad Mini is a 4:3 7.9" tablet that has 34% more screen area than the 16:9 7"ers. 34% is immediately noticeable when you hold them side by side.
SJ's original quote said nothing about 16:9 aspect ratio. He said the minimum screen size should be 10 inches. How does that garbage taste? Anyways, the point I was trying to make is just because an Apple exec says something like Phil Schiller did about a cheap iPhone doesn't mean Apple will never build it (the iPad mini being a perfect example of this). BTW I love the iPad mini but will wait for the Retina version.
Steve's original quote:
While one could increase the resolution to make up some of the difference, it is meaningless unless your tablet also includes sandpaper, so that the user can sand down their fingers to around one-quarter of their present size. Apple has done expensive user testing on touch interfaces over many years, and we really understand this stuff.
There are clear limits of how close you can place physical elements on a touch screen, before users cannot reliably tap, flick or pinch them. This is one of the key reasons we think the 10-inch screen size is the minimum size required to create great tablet apps.
Quote:
Originally Posted by theblackbubble
Apple does make cheap iPhones, it just does not sell them direct to consumers!
Every time Apple release the next generation iPhone a whole raft of previous generation phones move through the supply system - I know I've passed at least two generation to friends and family for considerably less than the original retail price.
Perhaps this is one of the best reasons for Apple to maintain iOS compatibility through iOS device generation, which generally is very good.
Given market figures for handsets, our website stats for clients show iOS devices still dominate over 60% of the engagement with websites.
I caution your use of the word, "cheap". Whenever people post about price (cheap or expensive) it's vital to specify what it buys...does that cheap cost include the total cost of ownership (i.e. data plan)? A $0.99 iPhone in the U.S. requires a fairly expensive 2 year data plan.
Is it considerably less than a new iPhone?...yes. But it's still not considered cheap to most.
Therefore, it has always been my contention that a different form factor (like an iPod nano but with a phone) which results in cheaper data plans is the most probably direction that Apple will take. Unless major networks dramatically bring down the cost of GB of data, every iPhone from the 3GS to 5 is still relatively expensive.
Further, an iPod nano-like phone reaches an audience very different from the existing iPhone market. The hardware will be cheaper than an iPhone and the data plans will be cheaper as well.
How is apple not a volume dealer? They sell millions of devices each month. That's pretty volume to me.
I can see that people would like to see apple as a luxury brand to make them feel better about themselves. For me a luxury brand is not only defined by lacking lower-mid-end products but also of the limit number of a certain product.
So for me, apple isn't a luxury brand as for example a ferrari is (you don't see many ferraris around do you?).