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Apple launches smaller, cheaper iPhone
March 22, 2016, 8:57 am
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The company also launched a new 9.7-inch iPad Pro and watch straps

Apple has made a second attempt at the mid-tier smartphone market with its new iPhone SE launch in bid to reach out to customers it couldn't convince to go big. The second-biggest smartphone manufacturer launched its four-inch iPhone 5c with a colorful plastic body in September 2013.

What the company did was removing the components from the newer phone and moving most of it into a smaller device and updating the look and preserving the choice for consumers.

The new smartphone is having the same performance as the iPhone 6S with A9 chip and motion co-processor, 4K video, 12MP iSight camera (panorama up to 63MP) and “delivers incredible battery improvements”  -  although Apple didn't give any specifics.

Prices for the iPhone SE start at $399 for 16GB and 64GB for $499 and will launch on March 24. Orders for the iPhone start this Thursday. That is the lowest price Apple's ever had for an iPhone.

Customers in the UK, Australia, Canada, China, France, Germany, Hong Kong, Japan, New Zealand, Puerto Rico, Singapore, US Virgin Islands and the US will be able to order iPhone SE beginning March 24, with availability beginning Thursday, March 31.

iPhone SE will be available in early April in Albania, Andorra, Austria, Bahrain, Belgium, Bosnia, Bulgaria, Croatia, Czech Republic, Denmark, Estonia, Finland, Greece, Guernsey, Jersey, Hungary, Iceland, India, Ireland, Isle of Man, Italy, Kosovo, Kuwait, Latvia, Liechtenstein, Lithuania, Luxembourg, Macedonia, Maldives, Malta, Monaco, Netherlands, Norway, Poland, Portugal, Romania, Russia, Saudi Arabia, Slovakia, Slovenia, Spain, Sweden, Switzerland, Taiwan, Turkey and UAE.

Apple-designed accessories including leather cases in black and midnight blue will be available for Dh149, and Lightning Docks in colour-matched metallic finishes are currently available from Apple’s retail stores and Apple.com for Dh199.

 “iPhone SE is an exciting new idea — we started with a beloved, iconic design and reinvented it from the inside out. The result is the most beautiful and powerful phone with a four-inch display in the world,” said Philip Schiller, Apple’s senior vice-president of Worldwide Marketing.

He said that iPhone SE has faster LTE and Wi-Fi, and Touch ID with Apple Pay. Everyone who wants a smaller phone is going to love iPhone SE.

The iPhone SE will be available in space grey, silver, gold and rose gold metallic finishes. Analysts had said before the event that a phone priced below $450 could be competitive with other mid-tier rivals.

The release of a smaller device could help Apple retain customers who simply prefer smaller gadgets despite Apple following a trend set by Samsung and other Android phone-makers for bigger display sizes.

Research firm Mixpanel’s data show that around 34 per cent of iPhone owners are using the smaller 4.7-inch iPhone 6 compared to 9.61 per cent of 5.5-inch iPhone 6 Plus as of March 1. Even though its low-cost iPhone 5c was widely regarded as a flop due to its plastic case, the iPhone SE retains its premium quality of Apple products.

The increasingly outdated iPhone 5 line, which measures four inches and dates from 2012, is now Apple's smallest phone.

The present iPhone 6 has 4.7-inch display and the iPhone 6S plus has 5.5-inch display. With iPhone sales remaining stagnant in US and Europe, the company is now focusing on emerging markets, especially China and India to boost its sales.

Apple sold 231.5 million units in 2015 with a market share of 16.2 per cent while Samsung sold 324.8 million units with a market share of 22.7 per cent.

How important is Chinese iPhone sales to Apple? 

Of Apple's $234 billion in sales in the last year, China contributed $60 billion and $1 billion came from India. Apple said in January that it expects a first decline in iPhone sales this quarter ending March 30, compared to the same period a year ago.

Research firm International Data Corporation is expecting an uptick in sales of devices running Android this year, to account for 82.6 per cent of smartphones sold worldwide. It expects iPhone sales to fall slightly, making up 15.2 per cent of the market.

The 2015 calendar year finished with 1.44 billion smartphone shipments worldwide, which were up 10.4 per cent over 2014. IDC's most recent projections show 2016 shipments of 1.5 billion, or 5.7 per cent growth over 2015.

According to IDC, the trend of single-digit year-over-year growth is expected throughout the forecast with volumes growing to 1.92 billion in 2020. The market will continue to see volumes shifting to the low end with the aggregate market average selling price (ASP) dropping from $295 in 2015 to $237 in 2020.

From a regional standpoint, mature markets like the US, China, and Western Europe all hit single digit growth in 2015, while high growth markets such as India, Indonesia, the Middle East and Africa, and other pockets in Southeast Asia, all remained healthy.

IDC expects 2016 to be relatively flat regarding iPhone volume. However, growth should return in 2017 and beyond as its trade-in programs will expand into markets outside of North America and help drive churn.

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