iPhone appeal dims as Samsung shines

2012-07-30 21:58
iPhone

iPhone

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

New York - The latest iPhone looks much the same as the first iPhone, which came out more than five years ago. That hasn't been a problem for Apple - until, now.

The pace of iPhone sales has slowed, Apple revealed last week. Part of the problem is that the competition has found a formula that works: thinner phones with big screens that make the iPhone look small and chubby.

For a dose of smartphone envy, iPhone owners need to look no further than Samsung Electronics, the number-one maker of smartphones in the world. Its newest flagship phone, the Galaxy S III, is sleek and wafer-thin.

By comparison, the iPhone "is getting a bit long in the tooth," says Ramon Llamas, an analyst with research firm IDC.

Apple has become the world's most valuable company on the back of the iPhone, which makes up nearly half of its revenue. IPhone sales are still growing, but the question of how fast they're growing is of keen interest to investors.

The iPhone certainly has room to grow: only one in six smartphones sold globally in the second quarter had an Apple logo on its back.

When Apple reported financial results for its latest quarter last week, a new phenomenon was revealed: Buyers started pulling back on iPhone purchases just six months after the launch of the latest iPhone model.

Apple executives blamed the tepid sales on "rumours and speculation" that may have caused some consumers to wait for the next iPhone, which is due in the fall. But in the past, iPhone sales have stayed strong nine months after the new model is launched, then dipped as people began holding off, waiting for the new model.

In the April to June period, Apple sold 26 million phones, 28% more than it did in the same quarter last year.

Complicated relationship

Most other phone makers "would kill" for those numbers, says Stephen Baker, an analyst with research firm NPD Group.

The exception is Samsung, which has solidified its position at the world's largest maker of smartphones. Analysts believe it made just over 50 million smartphones in the second quarter, or nearly twice as many as Apple. (The company doesn't release specific figures.) Its smartphone sales have nearly tripled in a year.

Most of Samsung's sales comprise cheaper smartphones that don't compete directly with the iPhone. Its flagship phones, though, have emerged as the iPhone's chief rivals.

Samsung and Apple have a complicated relationship. They're rivals in the smartphone and tablet-computer markets, and are set to square off in a high-profile trial over mobile patents in San Francisco this week. Samsung is one of Apple's largest suppliers of chips and displays, and Apple is one of Samsung's largest clients.

Though Apple is known as a relentless innovator, the iPhone's screen has been the same size - 3.5 inches (8.9cm) on the diagonal - since the first iPhone came out. It was a big screen for the time, but among the competition, screen sizes have crept up.

Samsung has increased the screen size of its Galaxy series with every model since it debuted in 2010. The Galaxy S had a screen that measured 4 inches (10cm) diagonally, and was followed by the S II, at 4.3 inches (10.9cm). The S III, the latest model, measures 4.8 inches (12cm). The screen is nearly twice as large as the iPhone's. Yet the Galaxy is thinner and lighter than an iPhone.

Samsung has also achieved surprising success with an even bigger phone, the Samsung Galaxy Note. Its 5.3-inch (13.4cm) screen makes it somewhat awkward to hold to the ear, but customers don't seem to mind, or perhaps they value the large screen and included stylus more.

Aside from design, Apple is inflexible in another way: by releasing a new phone only one per year, it lets the competition create new phones with features the iPhone doesn't have and lets them go unchallenged, at least until the new iPhone comes out.

"Apple's schedule leaves the other ten or nine months of the year wide open for everybody else," says Llamas.

For instance, the newest Samsung phones can use the latest high-speed data networks in the US, and talk to payment terminals in stores, so they can act as smart "credit cards".

All the profit

Samsung times its product launches to take maximum advantage of the lull in iPhone sales that usually precedes the launch of a new model. The S III went on sale in Europe in May and in the US in June.

The rest of the competition is in disarray, and hasn't been able to capitalise in the same way on Apple's rigid release schedule and conservative design. Nokia, until recently the world's largest phone maker, is in sharp retreat and is conducting a complete revamp of its smartphones.

Research In Motion is stuck with outdated software for its BlackBerrys at least until it launches a new operating system next year. HTC of Taiwan is suffering from marketing missteps in the last few years. LG Electronics, another Korean company, hasn't been able to keep up with Samsung when it comes to high-end phones, or with cheaper manufacturers on the low end.

Together, Samsung and Apple make half of the world's smartphones, and since competitors are losing money or breaking even, account for nearly all of the profits in the industry.

"Samsung is the only company that didn't really buckle under the weight of the iPhone 4S. Good, solid devices and good, solid marketing behind them," Llamas says.

Analysts now expect the new iPhone to arrive in September or October, probably with a slightly bigger screen. Sticking to one screen size has served Apple well, Baker says, but he sees the company moving with the times, as it's done many times before.

"When they have the reputation and the brand loyalty that they have, you don't have to be the first to market" with new features, Baker says. "You don't have to take that risk."

- AP
Read more on:    samsung  |  apple  |  rim  |  us  |  technology  |  mobile
NEXT ON NEWS24X
SHARE:

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
23 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
/News
 

Hottie of the day: Nicole Meyer!

Nicole is the cover girl for the 2014 edition of SA Swimsuit! Check out some smoking hot pics of here here.

 
 

Men24.com

11 things men don’t know about their clothes
Hilarious mortal kombat elevator prank!
This is how the Top Gear presenters spend their £55 million!
Thirty and still single? There’s hope!

Jobs in Cape Town [change area]

Jobs in Western Cape region

Junior Sales Rep

Cape Town
Contact Personnel
R8 000 - R10 000 Per Month

Executive Chef

Western Cape
Origin Foodservice Management
R11 000 - R13 000 Per Month

Millwright (Food) ( Hire Resolve )

Cape Town Southern Suburbs
Hire Resolve
R20 000 - R30 000 Per Month

Property [change area]

Travel - Look, Book, Go!

Magical Massinga

Spend 5 nights at the gorgeous Massinga Beach Lodge in Mozambique and only pay for 4 from R13 220 per person sharing. Includes return flights, accommodation, transfers and romantic turndown. Book now!

Kalahari.com - shop online today

Save up to 60% on toys!

Don’t miss out on this hot offer, save up to 60% on toys. While stocks last. Shop now!

Festive gifts!

Check out our awesome range of festive gifts to make everyone’s wishes come true. Shop now!

Seen something you like in our catalogue?

Find the perfect gift and save up to R5000 – As seen on the catalogue. Hurry and shop now!

Save up to R2200 on electronics! – As seen in the catalogue

Wishing for tech gadgets this festive? Save up to R2100 on hot tech products at kalahari.com. While stocks last. Shop now!

Up to 35% off books

Save up to 35% on the latest page-turners. While stocks last. Shop now!

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

Horoscopes
Aquarius
Aquarius

The Moon has moved into your sign, emphasizing the need to connect things to work together. There is a tendency to focus too far...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.