In recent years Apple (NASDAQ:AAPL) has trumpeted pre-order sales figures for its new iPhones, but has so far remained quiet on pre-order numbers for its new lower-cost iPhone 5c, leading some observers to wonder if Apple is facing weaker than expected demand for the device.
Apple and carriers started taking iPhone 5c pre-orders on Sept. 13. The gadget, along with the more expensive iPhone 5s, will officially go on sale Sept. 20. Apple has not taken pre-orders for the iPhone 5s.
As CNET notes, this is the first time since the 2009 introduction of the iPhone 3GS that Apple has not said how many devices it presold in the first 24 hours of availability. In 2012, Apple was quick to note that it had received 2 million pre-orders for the iPhone 5 within the first 24 hours, and carriers quickly pushed back estimate delivery dates.
In 2012, the iPhone 5 generated a bit more buzz than the new iPhones have thus far, mainly because it was the first time Apple had increased the screen size of the iPhone, to four inches, and because the iPhone 5 was Apple's first to incorporate LTE.
Additionally, it appears that demand for the new iPhones is weaker than expected in China. This is the first time Apple is releasing a new iPhone in China at the same as other markets around the world. China Unicom, the country's No. 2 operator, said Monday that online pre-orders for the iPhone 5s and iPhone 5s surpassed 100,000 units, sharply lower than the more than 300,000 units that were pre-ordered online for the iPhone 5, according to the Wall Street Journal. Meanwhile, the Journal also noted that China Telecom, the No. 3 carrier, has cut the amount of subsidies it is offering to new iPhone customers.
Apple did release a press release reminding the world that the new iPhones go on sale Sept. 20. As CNET notes, many could be waiting for the iPhone 5s to go on sale, since it offers a more powerful 64-bit processor and fingerprint scanning technology Apple has subbed Touch ID. That could make pre-order comparisons between this year and last year difficult.
Many analysts have said that the price of the iPhone 5c on an unsubsidized basis--$550 for the 16 GB model--is quite a bit more expensive than the $400 to $500 price range that they had expected. They have said that Apple has missed an opportunity to grab market share, but that apparently is not Apple's goal; the company appears more focused on maintaining its margins and not cutting corners in terms of device performance. As AllThingsD notes, the introduction of Japan's NTT DoCoMo as a partner and a long-rumored deal with China Mobile that may be in the offing are also factors in Apple's strategy.
"It could be that Apple is willing to stake out the high end and wait for the emerging global middle market to be able to afford its phones," UBS analyst Steve Milunovich wrote, according to AllThingsD. "While the 5c is too expensive for most developing markets, there still is an aspiration to own Apple products. … Exclusiveness creates its own demand."
Verizon Wireless (NYSE:VZ), AT&T Mobility (NYSE:T) and Sprint (NYSE:S) will sell the iPhone 5s for $199 for the 16 GB model, $299 for the 32 GB model and $399 for the 64 GB model, all with a two-year contract. Those three carriers will sell the cheaper iPhone 5c for $99 for the 16 GB model and $199 for the 32 GB model, on a two-year contract.
Meanwhile, T-Mobile US (NYSE:TMUS), which is touting its Simple Choice no-contract plans, laid out its own pricing. T-Mobile said it will offer iPhone 5s starting at an introductory price of a $99 down payment with 24 equal monthly payments of $22.91 for the 16 GB model, and the iPhone 5c will start at an introductory price of $0 down with 24 equal monthly payments of $22 for the 16 GB model. Those introductory prices are likely to increase over time, but the 5c price does represent a slight decrease in the regular unsubsidized price.
Meanwhile, Apple released its first commercial for the iPhone 5c, focusing on the device's colorful plastic casings, and set to Sleigh Bells' 2010 song "Rill Rill."
- see this The Verge article
- see this CNET article
- see this separate CNET article
- see this WSJ blog post (sub. req.)
- see this separate WSJ blog post (sub. req.)
- see this AllThingsD article
- see this separate AllThingsD article
Special Report: Apple iPhone 5S and iPhone 5C: Complete coverage
Apple's iPhone 5c goes on pre-order, with Verizon, Sprint, AT&T and T-Mobile each touting advantages
Apple's lower-cost iPhone 5c, at $550 unsubsidized, is more expensive than anticipated
Apple announces iPhone 5S, adds in fingerprint scanner
Apple unveils iPhone 5C, available for $99 with a two-year contract