“Apple Chief Executive Tim Cook went after the company’s two most important markets aggressively on Tuesday, providing a cheaper iPhone for developing markets and a more-powerful one for high-end buyers,” John Shinal writes for MarketWatch.
“The pricing of the iPhone 5C, $99 for a 16 Gigabyte-version and $199 for a 32 GB phone, will give Apple the opportunity to compete more effectively on price in places like China, where it’s a niche player lagging No. 1 handset maker Samsung by a wide margin,” Shinal writes. “Simultaneously, the company rolled out another phone, the 5S, with a 64-bit chip that the company said was “twice as fast” as the processor in the existing iPhone 5 — which the company is killing off. Cook’s decision to replace a product that’s just one year old — rather than keep making it at a lower price, as Apple has typically done — suggests he’s focused on improving Apple’s falling gross margin.”
Shinal writes, “The much-faster processing speed of the A7 that Apple is touting, if true, is going to bury sales of the old iPhone 5, whose operating system is suddenly slow. Of course, Apple, by re-configuring its iOS 7 mobile operating system to run on a 64-bit smartphone chip, has also pushed the innovation envelope against its rivals. With a chip this speedy, Apple is going to get a surge in interest from mobile game developers”
“Apple has just produced two new products that will likely appeal to both budget-conscious and affluent smartphone consumers throughout the globe,” Shinal writes. “If the Apple marketing machine can be as effective with them as it has with past models, look for Apple’s year-over-year sales growth in the fourth quarter to accelerate.”
Read more in the full article here.
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