“Apple is working on not just one but two new iPhones, both with larger screens, according to The Wall Street Journal,” Sam Mattera writes for The Motley Fool. “Other publications, notably Bloomberg and Digitimes, have made similar claims in recent months. Although I’ve been a longtime critic of Apple, there’s nothing negative that can be said about larger iPhones. Assuming these reports prove true, bigger iPhones should be a boon to Apple shareholders, allowing Apple to cash in on a market that’s been dominated by Google and Samsung.”
“The most significant selling point [of higher-end Android phones] could be their larger screens — the [Samsung] Galaxy S4 has a screen size of about 5 inches, while Galaxy Note III sports a 5.7-inch screen; both phones absolutely dwarf Apple’s 4-inch iPhone 5s,” Mattera writes. “Anecdotally, I’ve met a number of people who either have, or considered, switching over to an Android-powered phone based on nothing more than the screen size. Firsthand accounts of such Android converts consistently mention the larger screen as a key advantage.”
“But that advantage vanishes once Apple joins its competitors in offering larger handsets. Buyers of Samsung’s expensive handsets could be enticed to switch to Apple, knowing that they won’t have to sacrifice their larger screen in the process,” Mattera writes. “Given the popularity of Samsung’s flagships — the company shipped 40 million Galaxy S4s in the first six months and 10 million Galaxy Note IIIs in the first two months — Apple has a large opportunity.”
“At the same time, the iPhone’s average selling price should be expected to increase,” Mattera writes. “Apple CEO Tim Cook has said the company plans to release several new products this year. If one of them is a phablet — and it seems that will be the case, given the growing number of reports indicating as much — it will emerge as Apple’s most important product.”
