Apple Shows More of Its Appetite for the High End Market for Smart Phones
On Wednesday, October 15, 2013, the online edition of the Wall Street Journal published an article written by Lorraine Luk and Eva Dou. This article, titled ‘Apple Cuts iPhone 5C Orders’ reports substantial reductions in orders placed by Apple, with its suppliers, for components for Apple’s iPhone 5C smart phone. This information confirms a now widely held analyst opinion about Apple’s plans for its portion of the world wide smart phone market. Apple is ceding the majority portion of the “pie” over to competitors with offers at a lower retail cost to consumers.
These reductions are entirely consistent with the change in senior management of Apple’s brick and mortar retail store business to an executive with an extensive background in successfully operating ultra high end women’s fashion stores — namely the ex head of Burberry’s retail store effort.
So if any one still had any doubt as to where Apple is headed with its most important product, namely the iPhone, it should now be clear they are tightly focused on capturing as much of the market for very high end smart phones at very high retail prices as they can. Certainly they will make absolutely best efforts to deliver the most attractive value to these customers, but the opportunity represented by the enormous market for smart phones for emerging markets is not on their list.
I think Microsoft has a unique opportunity, at this point, to not only take market share from Apple at the high end (with the Nokia Lumia 1020 and 925), but to also rev up their new Nokia engine to go at the low-mid market in these emerging markets against Android smart phones. After all, Nokia produced more mobile phones than any other business as recently as 6 years ago. The sales apparatus is likely still in place. So an “affordable” smart phone for the emerging markets might be a real winner for Microsoft.
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