“Apple iPhone demand remains strong overall, with sales of the company’s high-end iPhone 5S smartphone more than offsetting weak demand for the midrange iPhone 5C, says Susquehanna Financial Group analyst Chris Caso,” Patrick Seitz reports for Investor’s Business Daily. “Continued strong demand for the iPhone 5S, which was released on Sept. 20, also takes the pressure off Apple to rush the iPhone 6 to market, Caso says.”
“Caso based his assumptions on supply chain checks that indicated ‘a significant production shift from iPhone 5C to 5S,'” Seitz reports. “March quarter production also is trending ahead of expectations, as Apple builds inventory to meet iPhone 5S demand and to prepare for an expected distribution deal with China Mobile, he said. ‘Our checks indicate the mix has indeed shifted disproportionately to iPhone 5S, with production of 5S running nearly 4x that of 5C,” he said. “Importantly, we note there wasn’t a fall off in demand for iPhone 5S after the initial strength of the launch. This shift should have beneficial revenue and gross margin implications’ for Apple in the December quarter.”
Read more in the full article here.
MacDailyNews Take: Gee, who the heck could’ve predicted this?
As MacDailyNews’ SteveJack explained on the very day that Apple unveiled iPhone 5s and iPhone 5c:
Apple’s iPhone 5s costs $100 more than an iPhone 5c — or $4.17 per month over the life of a typical two-year contract or, in other words, a completely negligible amount if you’re actually in a financial position to be able to buy and use a smartphone.
Let’s get real: If $4.17 per month means anything at all to you, you really can’t afford a smartphone to begin with. Over a two-year contract, the difference between the two iPhones is less than 14-cents per day!
The iPhone 5s is separated from iPhone 5c in many ways: Touch ID fingerprint recognition, materials quality, the camera’s larger 8MP sensor with 1.5µ pixels, ƒ/2.2 aperture, dual LED True Tone flash, Burst mode, slo-mo video, improved video stabilization, a 64GB option, and, of course, the A7 chip with 64-bit architecture and M7 motion coprocessor.
Unless you’re allergic to aluminum and/or fine craftsmanship, there is no reason why anyone who can afford an iPhone would not buy an iPhone 5s (unless you’re buying a first iPhone for your son or daughter). Even then, if you want a brightly colored polycarbonate phone or some feeling of extra protection from drops and dings, slap a plastic case on the iPhone 5s. There, it almost weighs as much as the 5c now.The bulk of any smartphone cost is the data, not the phone.
Am I missing something or is the price difference between the iPhone 5s and the iPhone 5c too insignificant to ever consider opting for the 5c?
Why the hell would anyone buy an iPhone 5c instead of an iPhone 5s?
It seems to me that Apple is using the iPhone 5c as a tool to push buyers to the 5s (well, at least those buyers who can grasp a simple value equation).
Once Apple gets the customer to the websites or into the stores and the prospective buyer can see and/or hold both phones and learn that they’re only separated by a mere $100, my guess is that Apple figures they’ll have plenty of upsales occurring. Upsales that will boost Apple’s iPhone margins nicely.
Oh, BTW, Apple’s going to sell a boatload of both models (and millions of 4s units too)!
Are you listening, margin-loving Wall Street?
Related article:
Why would anyone buy an iPhone 5c instead of an iPhone 5s? – September 10, 2013