Why the iPhone SE is more ‘designed for us’ than you probably think
On Monday, Apple gave what looked like a rather boring presentation that started out with privacy and environmental concerns, but most of the product information from the event had already leaked to the press. The two big announcements – the iPhone SE and the 9.7-inch iPad Pro – were already familiar to most tech circles before the event even started.
The iPhone SE has a similar design to the iPhone 5s, while its internal components have been borrowed from the iPhone 6s. It is the cheapest iPhone to launch so far, with a price tag of $399 (Rs 39,000 in India) and if you buy it from the US, you can get it for free with a carrier contract .
The 4-inch iPhone SE is an intriguing proposition and it comes at a time when Apple has had a largely flat quarter when it comes to iPhone sales growth. He gave a negative revenue forecast for the first time in several years, which made people think the iPhone had reached its peak. The launch of the iPhone SE on Monday is widely seen as an answer to this problem. But can it really help Apple?
Switch from contracts to installment plans
A big reason Apple needed the iPhone SE is that it now needs a presence in the midrange. And the reason is the way the US telecommunications industry has evolved. For many years, smartphones were routinely subsidized by telecom carriers in America, hiding their true costs.
A $600 (around Rs 40,000) smartphone is often sold for $200 (around Rs 13,000) when you get a contract with the carrier or through an upgrade program. It was great for Apple and other high-priced smartphone makers. However, there is a shift afoot in the US telecommunications market.
In a move started by T-Mobile in 2013, US telecom carriers are now moving from a subsidy model to a payment-based model. Here, the cost of the phone is not subsidized, and the user pays the full amount, in installments. The subsidy model hid the true cost of the phone, but with the installment model, that is no longer the case. And the payout pattern is showing real signs of traction among Americans in recent quarters. As reported by Fierce Wireless: “AT&T Mobility said 58% of its smartphone activations were for its upcoming EIP. [instalment plan]. Sprint reported a comparable figure of 46% (this also includes device rentals), and Verizon Wireless said about 25% of all its phone activations were done through its Edge. [instalment] program, compared to 12% in the third quarter. »
Now that more and more US consumers are paying top dollar, it’s no surprise that midrange phones are selling more, especially those sold through open channels. Counterpoint Research says open sales channels grew 164% year-over-year in Q4 2015 and the fastest growing smartphone makers were Huawei (+330% YoY) ), Blu (+610% YoY), Asus (+480% YoY). YoY) and Alcatel One Touch (+54% YoY) – all manufacturers that mainly sell mid-range handsets.
Apple never had a mid-range smartphone, as older budget models usually took up that space in the price range. With the iPhone SE, Apple, for the first time ever, has a sub-$400 smartphone with the latest specs, allowing it to compete more directly with companies like Huawei, Blu, and Asus.
At the same time, the design of the iPhone SE also means that users who were hesitant to upgrade their iPhone 5 or 5s because they didn’t like the design of the new iPhones now also have an option.
Before launch, Tim Cook said that about 60% of the roughly 400 million users who made up the iPhone install base in September 2014 had still not upgraded to the 4 biggest iPhones, 7 inches or 5.5 inches. During the launch, Greg Joswiak, vice president of product marketing for Apple, added that around 30 million 4-inch smartphones were sold in 2015, indicating that there is a large enough demand for small iPhones. screen/cheaper.
What about India?
While these reasons mean the iPhone SE should do well in the US, it’s less likely to do so in India in my opinion. Consider the iPhone 5c – Apple’s latest attempt to deliver a cheaper iPhone was not a smash hit in India. The iPhone 5c launch price was Rs. 41,900 in India for the 16GB model, and the 16GB iPhone SE is priced at Rs. 39,000, so there isn’t much difference.
This is a view shared by analyst Ben Bajarin, who tweeted“If the iPhone 5C didn’t perform well at this price, it’s hard to see why the iPhone SE would do better.” Speaking to Gadgets 360, Bajarin also said, “At the end of the day, I think this product will help Apple’s case in India, but their growth rate is just not China’s.”
However, many defend the SE by saying it has Apple’s latest internals, unlike the 5c. But for a buyer who only buys on specs, the limited details provided by Apple are unconvincing, compared to Android makers who would like you to even know the screws they used in their smartphones. And Apple’s hardware is generally more modest than what you find in Android phones, although the real-world experience may be better than on many competing devices.
In terms of form factor, the iPhone SE once again looks at a disadvantage. The trend in Asian countries at this time is towards phablets and it would be hard to convince someone to drop Rs. 39,000 for a 4-inch iPhone SE when a 4.7-inch iPhone 6s is currently available about the same price on Amazon.in.
An extra 0.7 inch might not seem like a lot when written down, but in real life the difference is very noticeable. And for most people, the even cheaper iPhone 6 might be an even better option, as most people will just use Facebook and WhatsApp, or play Candy Crush – tasks that even the older iPhone can manage without any noticeable difference. One thing that could have differentiated the SE would have been 3D touch, but that feature isn’t part of the new phone.
At current prices, it is very difficult to see the iPhone SE perform well in India. I can see Apple dropping the iPhone 5s from its lineup in the coming months, but the iPhone 6 will still be strong competition for the iPhone SE if both maintain current price levels. In my opinion, it will only be after the launch of the iPhone 7 and the price drops of the older models that come with it that the iPhone SE will have a real chance in India.