How Apple could sell 77 million iPhones in 2013

Generator Research’s Andrew Sheehy’s “premise is that the mobile services industry boils down to three ingredients — devices, networks and services. After 20 years and billions of dollars, the industry has done a good job delivering the first two, devices and networks, and a terrible job delivering the third ingredient: the services themselves. That, he says, is better done by companies with experience in computers, software and the Internet,” Phillip Elmer-Dewitt reports for Fortune. “Companies, he writes, like Apple:”

From a starting position as a rank outsider, Apple is already beginning to have a transformational impact on the mobile industry. Even taking into account the highly uncertain economic outlook, the company is on a roll and with cash reserves of $25 billion, 33% gross margins, no debt and a strong product portfolio.

Elmer-DeWitt reports, “He sees three reasons Apple is particularly well positioned to dominate the smartphone business.”

• In the future it won’t be good enough to deliver devices with more and more features
• Apple is the master of the vertical platform and the case for a vertical platform is even stronger in mobile industry
• Smartphones have the potential to substantially increase Apple’s revenues at a corporate level, which is not the case for a company like Nokia

Elmer-DeWitt reports, “For Apple to achieve the kind of growth Sheehy anticipates, however, several things have to happen.”

• Apple has to broaden its offerings
• It must open up the iPhone’s API to allow developers access not just to the device, but to the whole network
• It has to find ways to broaden the market

If all goes according to plan, Sheehy says Apple could soon become #1 in smartphone marketshare and sell 77 million devices in 2013 alone.

Full article here.

[Thanks to MacDailyNews Reader “James W.” for the heads up.]

17 Comments

  1. “It must open up the iPhone’s API to allow developers access not just to the device, but to the whole network.”

    Not entirely sure what he means by this, but, I think it will not and should not happen. What does he mean?

  2. There are some points that corporations make that the iPhone should think about addressing.

    But over all, the iPhone is being handled very well by Apple. They have learned a lot from the iPods.

    Two distinct model size/form factor choices is a good idea.

    Not sure what to do about the ATT exclusivity.

    As long as they are in control of the entire experience from hardware to OS, then I don’t care where they are sold.

  3. i can tell you how Apple could sell more iPhones/and like devices. Drop the exclusive deal with AT&T;. And there you go…

    And features we haven’t even considered in the U.S. are playing out in Asia, mainly Japan and Korea. So, the Apple still has some work to do.

    But this analyst may simply be doing a numbers game. (10M sold in 2008 hmm… 5 years from now? 77M). Subscriber & device renewal that could come in cheaper iPhones or new feature sets that involve more powerful, but battery friendly chips to keep the Mac OS on iPhone fluid.

  4. The problem is not the iPhone or the $199 price. The problem is the extra $35 per month just to use the thing. Either drop ATT or get them to drop the data plan fee. Without a data plan fee, everyone I know would have one of these things.

  5. Once they turn the iPhone into a lineup of devices and drop the ATT exclusivity, I can see Apple up there with the likes of Nokia, Samsung and LG. Their cell phone business will be so big that it could be spun off as an entity onto itself. The only limit is how fast they can grow to take on all of that extra work. Regardless I hope the expansion begins this year.

  6. My household is single-income. I have two kids with pay-as-you-go phones, as does my wife and I.

    I can afford the $199 for the iPhone, I cannot afford the $70 (approx.) call plan from AT&T;. Can’t imagine what 4 iPhones would run me.

    For the record, I do not pay for television, I use the good old antennae, and we can afford Verizon Fios. The internet is more valuable to me and my family than what television offers.

    The iPhone is out of the question.

    MDN Magic Word: provide “I can’t get an iPhone because I need to provide for my family.”

  7. I can afford the $199 for the iPhone, I cannot afford the $70 (approx.) call plan from AT&T;. The internet is more valuable to me and my family than what television offers.

    —————————–

    The call plan is $40, the unlimited data is $30 for a total of $70.

    If you can’t afford it, then you can’t afford it. But if the internet is more valuable to you than television, than maybe you should consider that $30 is not that out of line.

  8. I do believe ATT should offer the data, but not charge extra for it. $35 extra per month for data and text messaging is outrageous. Data and text messaging should be all-inclusive. The industry is moving that direction and it would be great if Apple could influence ATT to go that way sooner rather than later. $35 a month over 2 years means that iPhone will cost you $199 + 840 for a total of $1039. And that’s before your monthly phone plan charges.

  9. What about an iPhone without a data plan that would just use Wi-Fi when it’s available. I could make calls and use all of the Apps, and all of the iPod features, but no email or web unless I’m in a wi-fi zone.

    I guess it would be an iPod touch with a Phone built in. I’d buy that in a heartbeat.

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