Apple’s iPhone 5c will at first shake rather than break the Android hegemony

11 Sep 2013

It’s a fair complement to the rumour mill surrounding Apple that by the time Apple finally made its big reveal, there were few if any surprises left. And while analysts and investors were waiting for a big wow moment, what they need to understand what the lower cost iPhone 5c may do to Android’s steely grip on smartphone sales.

According to IDC just under 80pc of smartphones sold in the world today are Android devices. Apple has just under 14pc of all smartphones sales. Why? Well not all smartphone buyers fit the profile of an iPhone owner – people who can afford to splash out hundreds of dollars on annual basis to keep up with the trends.

And don’t forget, Apple knows how to derive far more profits from the iPhone than competing phone manufactures depending on the Android platform.

By bringing out a more affordable range of options on what is still no doubt an impressive technology platform – the iPhone 5c is in effect the iPhone 5 just dressed in brighter and more plasticky clothes – Apple has pulled off a masterstroke that won’t be understood in the initial phase.

As well as launching the iPhone 5c and the iPhone 5s which brings fingerprint ID and 64-bit processing to the smartphone world for the first time, Apple will bring out its next generation mobile operating system iOS 7 next Wednesday, which will come with 200 new features including AirDrop, iTunes radio, new security features and full-screen web browsing, to mention a few.

Because until now the iPhone was a device only affordable for middle-class and upwards cash-rich people, a large swathe of the world has been missing out on what happens to be the most logical, intuitive and best designed mobile OS in the world.

That is now about to change. The company on 20 September in a number of countries will launch a $16GB version of the new iPhone 5c which will cost US$99 and a 32GB version that will cost US$199.

In another masterstroke Apple has decided to allow operators to give consumers an 8GB version of the perfectly good iPhone 4S for free on contract via operators.

In two deft moves Apple has found a way to enter the affordable smartphone market where Google has held sway uninterrupted for the best part of five years now.

This won’t break Android’s hegemony in the initial phases, rather it will shake the hegemony and it will probably take a couple of years for Apple to make serious inroads percentage-wise.

But shake things up it will. Even if it only dents Android’s share in the next year, it could make a sizeable difference for Apple, which has become very skilled at deriving nice margins on every device it sells.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years