Print 95 comment(s) - last by retrospooty.. on Jan 17 at 7:54 AM

This may be a sign of how iPhone demand is faring amongst the competition

The latest iPhone may not be the rockstar Apple thought it would be. The Cupertino, California-based company slashed its orders for iPhone 5 screens by about 50 percent for the first quarter of 2013, and cut orders for other iPhone components as well.

This may be a sign of how iPhone demand is faring amongst the competition. Rival hardware makers like Samsung, whose devices are coupled with Google's Android operating system, have stolen much of the smartphone market share in the U.S.

For Q3 2012, Android was the No. 1 mobile operating system with a market share of 72.4 percent (compared to 52.5 percent in Q3 2011). Apple's iOS followed far behind at 13.9 percent (compared to 15 percent in Q3 2011).

As far as hardware goes, Samsung led the Q3 2012 market share at 22.9 percent (compared to 18.7 percent in Q3 2011) and Apple sat in third place at 5.5 percent (compared to 3.9 percent in Q3 2011).

Apple recently slipped behind in China's smartphone market as well. Apple, which previously held the No. 4 spot in the Chinese mobile phone market, slipped to No. 6 in Q3 2012 due to its low number of shipments, according to research firm IDC. Out of China's 60 million mobile phone shipments in Q3, Apple's iPhone accounted for less than 10 percent.

Apple's iPhone 5 was released in September 2012 with new features like a 4-inch screen and 4G LTE connectivity. It's available in either black or white, and is priced at $199 for the 16GB model, $299 for the 32GB model, and $399 for the 64GB model with two-year contracts.

Sources: CNET, The Wall Street Journal

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Wow... This is real.
By retrospooty on 1/14/2013 7:49:35 AM , Rating: 2
Its even on Apple insider sourced byt he Wall Street Journal.

My guess is, its not that sales are actually hurting, its that Apple expected its growth curve to continue... Which is simply impossible to do for too many years on end. Especially with pretty much every single competitor putting out far better phones at the same price.

RE: Wow... This is real.
By RufusM on 1/14/2013 8:47:02 AM , Rating: 4
This waning demand seems like market saturation is happening. Many iPhone users I know aren't moving to trade in their iPhone 4 or 4S for the iPhone 5 because their current one is still good enough.

Phones are on the fast growth track much like PCs were a number of years ago where each new hardware generation was so much faster than the previous generation there were large gains to be made in performance.

Now, with PCs many people just don't see a need to upgrade their older equipment since the new ones are marginally faster for the things they are used for. I think iPhones are starting to hit that point of marginal returns for newer generations.

RE: Wow... This is real.
By menting on 1/14/2013 9:01:13 AM , Rating: 2
but for most die hard Apple fans, it's not about if it's fast enough, it's about having the newest Apple device. I don't own any Apple devices personally, but quite a few friends do, and they have to get the newest every time.

RE: Wow... This is real.
By DanNeely on 1/14/2013 9:32:26 AM , Rating: 4
Apples market share has grown far beyond the diehard fans; joe sixpack doesn't care about having the latest and greatest as long as his current devices still work fine.

RE: Wow... This is real.
By retrospooty on 1/14/2013 9:52:25 AM , Rating: 5
Yup... What we are dealing with is Zeitgeist. In 2007 the iPhone came out and it was easily better than anything else out. It was a market changer... But even 3 years later in 2010 Blackberry was still growing, because of its own Zeitgeist. It was clearly bested in form and function, but still growing it's sales. Remember the term "Crackberry"? It took 4 years for that to wane and the majority of people to realize that Blackberry was years behind iPhone and Android. Now people are starting to realize that the iPhone is behind. It will be able to coast for a few more years, but at some point Apple needs to step it up to catch up with what everyone else is doing.

RE: Wow... This is real.
By jimbojimbo on 1/14/2013 3:29:32 PM , Rating: 2
I would say the point is that there are enough diehard fans out there now that they can release any product and they are pretty much guranteed that many sales all right on release day. That's why they will always have good opening and pre-order numbers but they can't keep up the sale numbers after that.

RE: Wow... This is real.
By retrospooty on 1/14/2013 9:55:16 AM , Rating: 2
True,but there aren't enough of those people to keep growing. It's not that sales are going down, its just that the growth rate isn't sustaining. What surprises me is how long is lasted already.

RE: Wow... This is real.
By Colin1497 on 1/14/2013 1:01:51 PM , Rating: 2
This is spot on. The only people really worrying about the upgrade treadmill at this point are the people who buy them for image. I've thought about upgrading my wife's iPhone 4, which is eligible, but we just kind of decided "meh, we'll wait for the next one." Like PC's, the upgrade cycle is stretching out.

RE: Wow... This is real.
By Nortel on 1/14/2013 10:20:29 AM , Rating: 1
Is it not entirely possible Apple is simply migrating production to another facility? I think people are reading far to much into this considering: Apple could not even make the iPhone 5 fast enough for market demand and now all of a sudden news arises showing a 50% reduction in demand?

RE: Wow... This is real.
By retrospooty on 1/14/2013 11:14:02 AM , Rating: 2
Its multiple vendors on multiple parts reporting this...

But you are not totally wrong. It's not that demand is waning, its that the forecast was bad. A growth rate cant continue forever. At some point it levels off.

RE: Wow... This is real.
By Tony Swash on 1/14/13, Rating: -1
RE: Wow... This is real.
By retrospooty on 1/14/2013 12:38:55 PM , Rating: 3
RE: Wow... This is real.
By Tony Swash on 1/14/13, Rating: -1
RE: Wow... This is real.
By Tony Swash on 1/14/2013 3:28:17 PM , Rating: 1
RE: Wow... This is real.
By retrospooty on 1/14/2013 3:49:34 PM , Rating: 2
I don't find any of that interesting (other than to rib you ;) ) as I am a consumer and do not hold a paycheck or my heart at any company. Not Google, not Samsung, and of course not Apple.

What will interest me is the products that come out and the features they have. Doesn't that make more sense?

"My sex life is pretty good" -- Steve Jobs' random musings during the 2010 D8 conference

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