The iPhone is without doubt among the best-selling smartphones on the market, but the iPhone 5 doesn’t comprise as high a percentage of total iPhone sales as Apple’s past flagship phones.
A report from Consumer Intelligence Research Partners says the iPhone 5 comprised only 68 percent of total iPhone sales during its first month on sale. (The study of 500 Apple product buyers in the United States was conducted a month after the iPhone 5 launched.) That’s still a majority of the phones Apple sold, but it’s a far cry from the 90 percent share the iPhone 4S enjoyed during its first month. That doesn’t mean the newest iPhone is tanking, however. It means cheaper iPhones are selling strongly.
“What those numbers represent is inflated total iPhone sales because people who couldn’t buy iPhones before are buying iPhones — they’re just buying 4′s and 4S’s instead of the 5,” Forrester analyst Charles Golvin told Wired.
The launch of the iPhone 4S in 2011 marked the first time Apple offered a trio of models at different price points: the 3GS for free with a contract, the 4 for $100 and the 4S at full price starting at $200. But at that point, the 3GS was available only on AT&T. Now that the iPhone 4, which also is available at Sprint and Verizon, is available for free with a contract, the landscape looks a bit different.
“Now there’s pent-up demand at those two carriers among customers who would really want an iPhone but can’t afford $200 for a 5,” Golvin said. “That pent-up demand is being reflected in a lot of iPhone 4 and 4S sales at those two carriers.”
Many of the people buying iPhone 4′s and 4S’s would in the past have bought Android phones.
On top of that, the iPhone 4S was made available at numerous smaller regional carriers across the U.S. Although the iPhone 5 is Apple’s fastest iPhone rollout ever, it arrived at regional carriers shortly after the phone’s worldwide debut.
Another contributor to the shifting sales proportions: launch timing.
“Last year the launch of the 4S came 18 months after the launch of the iPhone 4,” Canalys analyst Chris Jones told Wired. “People had a long time to wait from one generation to the next. From the 4S to the 5 was about 11 months. Perhaps there was more pent-up demand last year than this year given the length of time people had to wait from one generation to the next.”
Not everyone is able or willing to ditch their two year contract to get the latest handset, and may end up upgrading later on.
Michael Levin, co-founder of CIRP, saw two other possible reasons for the iPhone sales shift. “There seems to be some pressure from competitors, like with the Samsung Galaxy line,” Levin said. Apple is a new entrant to the LTE market. Android competitors, like Samsung, have had a solid footing there for multiple years. “And people are finding the 4S and 4 are just about as good as the 5 in terms of experience.”
Jones said that supply constraints may also be forcing some would-be iPhone buyers to switch to other 4G LTE handsets because they simply aren’t willing to wait for a phone.
AllThingsD noted that the trend CIRP has observed, if it continues, will lower the average selling price of the iPhone, and could have a negative impact on Apple’s traditionally gangbuster iPhone profits. Golvin said that the trend — an uptake in iOS users, but fewer on the flagship model — could represent a tradeoff in Apple’s margins, but it’s unclear because we don’t know what Apple’s margins are on older iOS products.
Jones notes we’ll get a much more accurate picture of what iPhone sales are like in January, when Apple announces its first quarter results.
iPhone Sales Shifting Away From Flagship Model
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iPhone Sales Shifting Away From Flagship Model
