Despite the myriad of leaks regarding Apple’s iPhone Event held yesterday, one thing was kept completely secret. That being that the iPhone 5C is not a low cost or “cheap” iPhone, it is a direct replacement for the iPhone 5.
Usually with a release of a new iPhone, Apple reduces the price of last year’s model to become a second tier product and then the new iPhone becomes the flagship. The expectation was the iPhone 5S would be announced, the iPhone 5 would reduce in price (but both products would still have fairly premium price tags), then the iPhone 5C would be priced much lower to cater a mid-tier consumers and emerging market.
Instead iPhone 5S is the flagship, and rather than reducing the iPhone 5 the 5C is now the second tier (the 5 is no longer in production). There is no new mid-tier iPhone, both the 5S and 5C really cater to the higher end of the market.
In my mind this makes the existence of the iPhone 5C pretty pointless for consumers, the pricing difference between the two phones is so small (iPhone 5C starts at £469, iPhone 5S starts at £549) that anyone looking to get a new phone this year might as well get the top end phone. It also means Apple still doesn’t have mid-tier handsets to offer more price sensitive consumers, increase their market share or significantly compete in emerging markets.
The only benefit the iPhone 5C has, is to Apple’s profit margin, I’d imagine the 5C cost a lot less to produce than the 5 (due to the new plastic shell) and the fact they’re charging the same price for it means Apple’s bottom line just gets bigger. This works great for Apple in the short-term, but it doesn’t cater to mid-tier consumers or help Apple’s market share in the long-term.
Apple’s products have always had an “apple tax” added to them, but this is the first time I’ve seen a product and just thought it’s a complete rip off. If I’m paying the same money for a 5C I would have for a 5, I’d rather have a 5 with it’s premium glass and metal (but I can’t because Apple no longer sells it).
Of course, the flip side is that this could be marketing genius, because of all the above points the iPhone 5C has actually made me want to upgrade to the iPhone 5S instead.
That’s if I upgrade…
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