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BLOG: Analysts offer 'iPhone mini' antidote to Apple's Samsung problem

Jonny Evans | Jan. 7, 2013
If nothing really changes, Samsung is expected to widen its lead against Apple[AAPL] this year, according to Strategy Analytics. But will things stay the same, or will 2013 be the year the iPhone company changes the rules with an iPhone mini and more frequent product upgrades?

Diversity of models

At present, diversity in Apple's iPhone universe is limited. You can get an iPhone 5, iPhone 4S and iPhone 4 (in some countries). While this makes an iPhone available to a range of customers at different prices, it doesn't quite match the impact of Samsung's broad array of phones.

What might Apple do? Topeka Capital Markets analyst Brian White speculates it might introduce iPhones with two different display sizes in a range of different colors.

"Our checks indicate that the next iPhone will have more choices for customers. This entails an expansion in both the color patterns and screen sizes with the next iPhone (i.e., likely called the iPhone 5S) that we currently believe will be launched in May/June with certain supply production starting in March/April," he wrote.

He anticipates the iPhone 5S will be made available in five colors: black, white, pink, yellow and blue.

The merit of this analyst's prognosis is that it broadens the company's reach into different segments of the evolving market. The negative impact is that offering such a diverse product range would demand different production processes for each available form -- though with approximately 205 iPhones sold each minute of each day there's more than ample sales to justify any additional production costs.

New products

"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," said Neil Mawston, executive director at Strategy Analytics.

While the analysts say this is in response to Samsung's success, it is worth observing Apple has seemingly been developing plans for new families of iOS-powered smartphones for years.

In brief, the iPhone nano/mini device would be equipped with a small screen and Siri support. You would be able to use a limited array of apps (Mail, Calendar, Maps) on the thing, rightly seen as an iOS-powered communication and personal management device.

It seems likely Apple has delayed any such plans pending development of Siri and iCloud services. You'd have little storage on these things, and you'd lack the screen real estate to rely completely on a touch-based user interface. With Siri still in beta it seems unlikely we'll see an iPhone nano this year.

Though given recent reports claiming Apple's working on a range of wearable devices, it's not insane to imagine what such a product might consist of should the company accelerate any launch plans it may, or may not, have.

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


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