iPhone 5C: Not What We Expected

Today Apple released it’s newest member of the family, the iPhone 5C.  It was expected to fill the gap in Apple’s product line for us poor people, er… conservative spenders.  There has been an obvious need; the iPhone 4S outselling the new iPhone 5, struggles in emerging markets due price, and China (one of the largest smartphone markets in the globe) practically avoiding the Apple brand.  Welcome the iPhone 5C, a curious sight.  It’s a slightly less powerful, similarly sized device with vibrant, colorful plastic casing.   How does the iPhone 5C stack up? Follow below.

Apple used to be one of the tightest companies for product leaks, yet this has been leaking bit by bit for six months.  Amid the speculation we’ve always thought Apple would produce a quality product.  They’ve been tightly knit with their app store, software and services so it would have been a huge surprise to get something that didn’t work flawlessly.  It doesn’t disappoint in that aspect, as it’s almost identical to the iPhone 5.  Apple owners will still have a quality camera with the most recent version of the operating system, iOS 7.  So what’s the real big change?  Plastic casing and a polarizing rubber case.  Instead of just black and white, this has bright yet muted colors of green, yellow, blue, and a pink/red.  Perhaps a cue was taken from Nokia’s Lumia line which has become a recent hit, applauded for it’s colors.

The biggest point of speculation was price.  Apple’s entire point of this phone (so we thought) was to get into the mid-tier market, generally running about $300-400.  They were faced with a dilemma.  Emerging markets aren’t buying the $650-750 iPhone. Pricing the new phone around $300 would guarantee sales success around the globe and bring Apple into more homes.  This is great because Apple dominates in the US yet struggles in other countries like China where most people buy phones off-contract.  The danger in low pricing?  Reduced profit margins.  Since Steve Jobs passed, the company seems less focused on innovating and more on squeezing out every dollar for shareholders.  On the other side, Apple could have also priced the new iPhone on the higher end, $400 or so, keeping margins high while making it a tough sell to consumers.  Buy the colorful plastic iPhone 5C or buy the nicer “last gen” aluminum and glass iPhone for the same cost?

Get ready for a shock: starting cost for the 16gb model is $550, selling for $99 on contract, and $650 for the 32gb model selling for $199 on contract.  It’s enough to make mroe than a few of us cringe.  This isn’t a middle-tier phone at all.  In fact, to reduce cannibalizing sales they’ve announced they’ll be discontinuing the iPhone 5.  Consumers can now buy the iPhone 4S, iPhone 5C, and iPhone 5S…. but no iPhone 5.  All we can imagine is Apple can now squeeze more profits from it’s cheaply made plastic case rather than selling the iPhone 5 at a discounted price.  They obviously learned a lesson from the 4S cannibalizing the 5.

This move makes it difficult to think new customers outside the current Apple market will be flocking in.  The thought of a “low-cost” iPhone really didn’t mean low-cost to consumers, maybe it just meant low-cost to Apple.  Let’s bring a little style and flare to the phone while putting extra dollars in our pocket.  Unusual move and certainly not what we were expecting.  All this phone represents is a way to squeeze more dollars out of customers who don’t want or can’t afford the latest and greatest iPhone.  Let’s just hope that sticking to their premier price point while not providing much extra value doesn’t come back around to bit them in the ass like what happened with Microsoft in the 1990’s.

Your thoughts?  Share below.

-The Tizz

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s