Smart Apple watchers expected the company to unveil a new, cheap iPhone to compete in China this week. So where was it?
At first glance, the iPhone 5C seems to fit the bill. With a subsidized price starting at $99 in the US, it surely is less expensive than the new iPhone 5s.
"These are not the phones you're looking for."
But the iPhone 5C is expensive in China, notes The New York Times:
Apple said on its Web site that the iPhone 5C would start at 4,488 renminbi, or $733, without subsidies from mobile operators. That is not far below the price of the new flagship Apple iPhone 5S, which starts at 5,288 renminbi. Both phones were officially announced in California on Tuesday.
“If you look at the price, it’s clearly a high-end phone, not a low or even midrange phone,” said Jenny Lai, an analyst at HSBC in Taipei, referring to the iPhone 5C.
The price is about 33 percent higher in China than the full, unsubsidized $549 cost in the United States. Chinese carriers don’t generally subsidize the handset price for consumers, but they often discount their monthly bills. So the eventual cost to consumers has plenty of room to come down.
But given that Apple has been losing ground to lower-cost rivals in China, some of which make smartphones that sell for less than $100, will the 5C be able to turn around the company’s fortunes there?
Also missing from this week's announcement: An expected deal with China Mobile, the biggest network operator in China and the world, with 745 million mobile customers.
It's possible Apple announced a high price at first in order to cut it later. The phone is compatible with an LTE network China Mobile is still building. Apple is possibly testing the market.
The Chinese market is important to mobile vendors. Vendors shipped 88 million smartphones to China in the second quarter. That's more than to the US (32 million), India, Japan, and the UK combined. Apple is losing in China, ranked seventh place, with just 4.8 percent market share.
But even if the iPhone 5C isn't cheap, it's still a big deal. Apple is dividing the iPhone from one product line into two, says Daring Fireball's John Gruber.
The 5C is Apple's mainstream phone. The 5s is the high-end phone. We see a similar distinction in the notebook line: MacBook Air is the notebook for everyone, while the MacBook Pro is for power-users.
Gruber also sees an iPad announcement in about six week. He notes last year Apple held events on September 11 for the iPhone and iPods, and October 23 for iPads. Therefore, he expects an iPad event in late October.
Apple’s Reputation for Innovation Is Now Its Greatest Liability. Great point. If Apple were any other company, Apple would be soaring now. It makes great products that people love, and sells them at a profit. But great products aren't enough for Apple. Apple has produced miracles in the past, and is now required to continue.
Apple CEO Tim Cook said in the spring that we can expect "a lot more surprises in the works," with new things coming in the fall and through next year. As an Apple fan, I hope so.
— Mitch Wagner , Editor in Chief, Internet Evolution