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iPhone mini "will help Apple close gap on Samsung"

iPhone 4 back

By Reuters and Barry Collins

Posted on 4 Jan 2013 at 09:02

Apple will launch an iPhone mini for those who cannot afford the firm's high-end handsets, and help close the gap on runaway market leader Samsung.

Samsung is expected to widen its lead over Apple in global smartphone sales this year with 35% growth, helped by a broad product line-up, according to market researcher Strategy Analytics.

Apple, returning the offensive, could roll out a smaller, cheaper iPhone mini next year to grab market share by targeting demand from users of lower-end smartphones, the firm claims.

"We expect Samsung to slightly extend its lead over Apple this year because of its larger multitier product portfolio," said Neil Mawston, executive director at Strategy Analytics.

Global smartphone shipments will jump 27% to 875 million this year, slowing from last year's torrid 41% pace as growth is easing in many key markets such as North America, China, the developed economies of Asia, and Western Europe.

Samsung is forecast to sell 290 million smartphones this year, up from a projected 215 million in 2012, the research firm said. Apple's smartphone sales are projected to reach 180 million this year, up 33% from last year, slightly trailing Samsung's 35% increase.

This will give Samsung a 33% share of the 2013 smartphone market, up from last year's estimated 31%, while Apple will hold 21%, versus last year's 20%.

Need for a mini

Apple and Samsung have battled fiercely in the global mobile device market, which they dominate, although Samsung is also a supplier to Apple.

Samsung may launch the Galaxy S IV, a new version of its flagship smartphone, in April, the Galaxy Note III "phablet" and a series of other new smartphones over the course of this year, media reports and analysts have said recently.

"Samsung plays in more segments and this should enable it to capture more volume than Apple," Mawston said.

Brian J. White, a researcher at Topeka Capital Markets, raised the possibility that Apple may launch a smaller and lower-priced iPhone - the iPhone Mini - to further penetrate markets such as China and India.

White said in a report that he believed Apple will launch the next iPhone, the iPhone 5S, in May or June, and offer more options in screen sizes. This would eventually open up the possibility for the iPhone mini, he said.

But Mawston said the iPhone mini was not expected to hit the market until at least next year. "We think Apple will have to launch an 'iPhone Mini' at some point over the next three years to address the hundreds of millions of prepaid users worldwide that cannot afford the current iPhone," he said.

"The iPhone 5 is growing fast and profitably right now, so there is little incentive for Apple to launch an iPhone mini this year.

"We expect the iPhone mini to be more likely next year, in 2014 when... Apple will be forced to discover fresh growth streams," he said.

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User comments

Misunderstanding Apple

These so-called analysts have no clue at all about Apple and how they think. Apple has never shown any interest in a race to the bottom just to mop-up market share! They're more than happy occupying the more select, richer end of the market and leaving Android to pick up the elderly, poorer and budget-conscious. That's why stats like web use on handsets consistently show Apple leading. These analysts are clueless.

By SheffieldSteve on 4 Jan 2013

I can't say I entirely agree with SheffieldSteve's suggested demographic, but the rest makes sense. Apple are making more profit selling fewer phones than the competition, so there's little point in making a cheap one. It's quite surprising such an expensive product holds such a large share of the market as it is. You don't get that in many other industries.

By mulvaney on 4 Jan 2013

Why mini?

Just keep making the 4S and drop the price by £100.

Solved!

By cheysuli on 4 Jan 2013

@cheysuli

I was confused as well, as Apple's policy of selling old models at reduced prices seems to remove the need to an iPhone mini. An iPhone 4 is £319, and I can't see Apple going much further down market.

As we have seen with the iPad, Apple have also changed the spec of old models to make them cheaper to manufacture while maintaining or improving performance.

By tirons1 on 4 Jan 2013

I'm more confused about the language of this article. It starts with "Apple will launch an iPhone mini" but then no evidence that this is the case. Will launch? Or speculated that they might?

It then goes on to say that someone, not associated with Apple, has suggested they may do it. That's hardly news, that's just half-baked guess work based on no evidence.

Sloppy.

David.

By artiss on 4 Jan 2013

Agreed with SheffieldSteve

Surely an iPhone Mini at a lower price point would simply dilute Apple’s identity as purveyors of overpriced, fashion-premium items. What the analysts may not have considered is that one of the draws of the Apple ecosystem is precisely that it is exorbitantly overpriced, which safely makes their products status symbols (why else would every third party iPhone case have a cut-out for the Apple logo?).

I sometimes wonder about the stats regarding internet use on handsets, though. Apart from the legion OAPs and school children poking around on Apple’s finest, it appears that many obviously unemployed people from the poorer estates also proudly tout iPhones (a clear indicator being hauling a Staffordshire bull terrier around in the middle of the day, and a Burberry cap). So perhaps these handset web use figures are due to a significant chunk of the iPhone user demographic either having no computer at home (not cool, after all!), or having to rely on the restrictive and idiot-proof simplicity of “Just Works” to enable them to browse the internet.

By TheHonestTruth on 4 Jan 2013

Apple Has Lost Its Bite

The most interesting thing about the latest bla bla about Apple is how the next big thing (iphone 6 or mini iphone - take your pick) will be the Samsung / Android killer. What that tells us is that the iphone 5 didn't cut it. how could it with its purple pictures and useless maps. Perhaps all the people who were stupid enough to buy it realise now they've been had by cool marketing (style over substance)

By barrada on 4 Jan 2013

Apple Has Lost Its Bite

The most interesting thing about the latest bla bla about Apple is how the next big thing (iphone 6 or mini iphone - take your pick) will be the Samsung / Android killer. What that tells us is that the iphone 5 didn't cut it. how could it with its purple pictures and useless maps. Perhaps all the people who were stupid enough to buy it realise now they've been had by cool marketing (style over substance)

By barrada on 4 Jan 2013

Wait, they expect an iPhone with an even smaller screen? They've already got the tiniest screen they can find.

By Mark_Thompson on 4 Jan 2013

Budget iPhone

Apples budget iPhone is always last years iPhone.

By LiL_Ze on 5 Jan 2013

@TheHonestTruth @barrada

Quote: "...these handset web use figures are due to a significant chunk of the iPhone user demographic either having no computer at home (not cool, after all!), or having to rely on the restrictive and idiot-proof simplicity of “Just Works” to enable them to browse the internet."

ROFL. Thanks for that. :)

Quote: "Perhaps all the people who were stupid enough to buy it realise now they've been had by cool marketing (style over substance)"

Sadly, for the the fanbois, they haven't the nous to spot that fact.

By jontym123 on 5 Jan 2013

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