5 ms·

Thoughts and Observations on Today’s iPhone 5C and 5S Introduction

59 points by cuttooth 13y ago

molecule 13y ago
> Take a look at apple.com today and note which new iPhone appears first the 5C, not the 5S. Which phone did they show a commercial for? The 5C. Which one will have a higher profit margin for Apple? The 5C.
- clarky07 13y ago
  perhaps. everyone assumed coming in to today that the "cheaper" version would hurt margins. Granted it was priced above expectations, I'm not sure it will have significantly higher margins.
  - bryanlarsen 13y ago
    I think it will have higher relative margins than the 5S but lower absolute margins than the 5S. But that's just a guess. But what is relatively assured is that it will have substantially higher margins than the equivalent in their old strategy, a price reduced 5. So it's quite likely that the introduction of the 5C will increase Apple's overall margins rather than decreasing it, as everybody expected.
- twiceaday 13y ago
  Which one are they not taking pre-orders on? The 5S.
- threeseed 13y ago
  The 5C is not about a higher profit margin for Apple. It's about maintaining their current profit margin whilst offering carriers a bigger incentive to bundle and sell and their phones.
nwh 13y ago
They seriously need to fix their international pricing. For a 64GB model it's $913AUD to buy an iPhone 5s in the US, $1129AUD to buy one in Australia. What?
- bowlofpetunias 13y ago
  VAT, import tariffs etc. Apple doesn't need to fix anything.
  - nwh 13y ago
    There's GST in Australia rather than VAT (10% vs 17.5%), and last year the prices were almost at parity.
    - deleted 13y ago
      [deleted]
    - recoil 13y ago
      Apple don't trust the AUD not to drop further than it already has in the last 3 months.
      - Jam0864 13y ago
        What a laughable excuse. It's been this way for years.
        cremnob 13y ago
        Apple will adjust pricing based on currency. If the Australian currency is getting weaker it may be because the emerging markets that it depends on are seeing turmoil in their currencies because of the prospect of Fed QE tapering. http://www.telegraph.co.uk/technology/apple/4934147/Apple-ups-price-of-Mac-computers-as-exchange-rate-bites.html http://www.telegraph.co.uk/technology/apple/4934147/Apple-up...
        Jam0864 13y ago
        Apple has overcharged both in Australia and Europe for decades, even when the currency has been strong. It's simply because they believe that people who live there will stomach a larger price. It's probably true. It's still infuriating. It results in funny cases where a Nexus 4 can be 1/3 the price of an iPhone 5.
r00fus 13y ago
The 5C is important for one big reason: China. I expect the "unlocked" price won't reflect the kind of subsidies and discounts that China Mobile and Apple can give to make it affordable for their customers.
- simonh 13y ago
  I think the "C stands for China" is fair, but I don't expect Apple to break with their multi-decade tradition of maintaining the highest margins that are compatible with a viable market presence. Yes margins will be lower in aching than elsewhere, but they are not going to even attempt to compete with Android for market share because it would be utterly pointless. The Chinese mass market is dominated by extremely poor bargain bucket Android devices with invisibly thin margins that can barely scroll a web page. It is true that Samsung has a strong presence over there and Apple needs to deal with that, but the premium end of the market is big enough for both to do well. The kind of people who are likely to prefer an iPhone over there aren't as price sensitive as the average and charging them less just to also sell a few more units down market would just be leaving money on the table. That's not something Apple has a habit of doing.
  - Tyrannosaurs 13y ago
    There's enough money in China that Apple can make some in roads but a bulk of the phones selling there are sub $200 (off contract) non-Google Androids. The 5C isn't going to take anything out of that market. Rather boringly I suspect the C stands for colour (or color if you must).
- ttflee 13y ago
  Reality check: 1. The spec published today is not suggesting that iPhone 5c/s would support TD-SCDMA networks which CMCC is bound to due to regulation reasons. And LTE-TDD is light year ahead for CMCC. 2. A difference of mere 800 CNY in price between 5c and 5s is not attractive enough to those who can afford 5,000+ CNY(, i.e. the iPhone 5s) in China. And in the past, smugglers carrying duty-free iPhones from Hong Kong in the first few months of sales may reduce the high price caused by the tariff and VAT. Now, Hong Kong is NOT even in the initial list!
stevep98 13y ago
> Next, it has an intriguing “motion coprocessor”, which I think pretty much means you can use your 5S as a fitness tracker with almost no effect on your battery life. My guess is that it's much more than this. It's for augmenting the GPS location with dead-reckoning, for places where the GPS location doesn't reach well, such as buildings or on subways, etc. Accelerometers are already pretty sensitive - enough to provide an improvement on GPS-only devices. But, this new coprocessor will allow a much higher-resolution sampling of the accelerometer, and thus the integration (in the calclus sense) of acceleration into velocity and distance will be much more precise.
- derefr 13y ago
  What I hope this really means is less battery drain for geofencing.
- simonh 13y ago
  Inertial navigation? It's an interesting idea, but I think if they were doing that, they'd have touted it in the presentation as an example of something they can do that nobody else is even thinking about. It's not like apple to miss an opportunity to try an distance themselves from the pack on their technical capabilities.
  - rahoulb 13y ago
    One thing I noticed is that they said the 5S is a "forward-thinking" device, implying that they've got more planned for it.
- inoop 13y ago
  I doubt it's for GPS assistance. Motion sensors can be used to suppress Wi-Fi scanning and/or GPS localization during the roughly 89% of the time humans are not moving. Remember, phones continually scan for new Wi-Fi APs in the background even when the screen is off. On modern phones with a/b/g/n chipsets (32 channels to scan) and energy-expensive CPUs (i.e. Exynos) this takes a huge amount of power. Motion sensors themselves are really energy-cheap but the main CPU needs to be on to sample them, which basically means that if you want continuous mobility detection you're going to burn through your battery pretty quickly, which is why it isn't used much. You can do some CPU duty-cycling, but wake-up and suspend overhead is pretty bad and can amount to as much as 50% of the total energy spent. I haven't done any measurements on an iPhone, but a GS2 Exynos 4 is a terrible energy drain, while an something like an OMAP 4460 (e.g. Galaxy Nexus) is much more efficient. By offloading mobility detection to a separate chip you can bring down the overhead to tens of mW. The fact that you can use it as a step counter for jogging is just icing on the cake :)
hcarvalhoalves 13y ago
The 5S camera is killer. f/2.2, apparently a great sensor for the size and 120fps video is more than most pocket cameras offer. Manufacturers of point-of-shoot cameras can pack up and leave if this is a trend.
- sspiff 13y ago
  If lower end smartphones adopt this kind of camera (which I think is unlikely) then point-and-shoot cameras could have a problem. However, comparing a $600 iPhone to a $70 point-and-shoot is not really relevant.
  - ubernostrum 13y ago
    If the expensive device is something people will buy and be carrying with them anyway for other purposes (phone calls, SMS, apps, etc.), then they have no motivation to additionally buy the cheap photo/video-only device and carry that with them. It's the same reason why, if there was a $20 Facebook device, a $20 Twitter device, a $20 SMS device, etc., they wouldn't sell very well since the phones people already carry can do those things without needing to purchase and tote around multiple other devices.
  - runn1ng 13y ago
    just a note (for you and for everyone else): stop whining about downvotes. sometimes you are downvoted. it happens. but more often than not someone upvotes you again, and then it just look whiny, espescially if you are second comment on the page (as you are now).
    - sspiff 13y ago
      Point taken, removed the whiny bit.
  - svantana 13y ago
    Well you're probably gonna need a phone anyway, so the question is rather why someone would pay $70 for an extra device rather than $70 extra for a phone with a good camera.
greyman 13y ago
I am curious to see how those two will sell. I can't imagine myself to buy the not-so-cheap 5C, when for 100 eur more, I can have faster processor (which will be important thing for iOS7), much better camera, non-plastic body and other things.
T-zex 13y ago
Nokia designers should be proud of themselves for setting a colorful plastic case trend for the smart phone market and even influencing the iPhone.
- Steko 13y ago
  Apple's following the exact same playbook they wrote with the imac and ipod where they focussed heavily on the primary form factor for several years and then threw open the gates to colors. http://www.fastcodesign.com/3017050/untold-stories-inside-apples-love-hate-relationship-with-color http://www.fastcodesign.com/3017050/untold-stories-inside-ap...
- threeseed 13y ago
  Nokia's designer and product managers have nothing to be proud of in its history. They let companies like Apple, Samsung etc come in and dominate what was their industry to own.
  - drill_sarge 13y ago
    I have a Nokia 3210 as backup phone which still works flawless today. Or an E-7, still working. Most of the other phones I had went defunct at some point or the non-replaceable battery went dead and new phone was cheaper than getting it replaced and so on. Thats something to be proud of. Ok, maybe not for the product managers ;)
  - T-zex 13y ago
    I agree about the product managers, but I don't think that designers are to blame for the failures in the smart phone market.
nagarjun 13y ago
I think the iPhone 5S Fingerprint Reader is revolutionary because it is invisible: http://t.co/AfQSFqAjBy http://t.co/AfQSFqAjBy.
josteink 13y ago
> Yes, it’s plastic, but there’s nothing cheap about it. Hard back-pedalling on plastic observed.
halfninety 13y ago
My opinion is the exact opposite. I don't think the 5C is an appealing middle tier, I believe it's a dumb middle tier, and maybe intentionally so, to make the premium offering stand out more. 1. If it's intended to be appealing, why call it "5 Cheap"? Okay, Apple didn't call it "5 Cheap", but everyone thinks so, and in marketing, what consumers think is the truth. Additionally, Apple didn't try to correct people when everyone thought it would be cheap. Who is gonna buy a phone that is "cheap" but not cost effective? 2. The 5C isn't that appealing against 5. Yes, a new product is a new prodcut, but a flagship is a flagship. In emerging markets, why do people spend a month's salary for a phone? Because they want to show off to ohters, or at least so that people can't show off to them. Which one do you think have more "show off" power? The previous year's flagship (people don't know when you bought it) that looks identical to this year's flagship, or the "cheap" alternative? 3. The colorful back is suitable for really cheap devices, not seemingly cheap but actually expensive ones. They are liked by young people, mostly students, and new graduates. They don't have much money, and prefer cheaper devices. The 5C isn't cheap. Premium products are never colorful, for a reason. 4. The 5C is a worse product than the 5, technically. It probably has only about 10% larger battery capacity, but is 18% thicker and heavier. I can imagine how many cheap materials are used to make that happen. 5. If you look at the big picture, the trend is smaller and smaller differences between generations of iPhones. And because of the diminishing differences, people are more and more likely to choose an older generation for a cheaper price. According to one source[1], the 4S commanded 90% of all iPhone sales immediately after launch, and almost 75% a year later, before the 5 was launched. The numbers are 70% and 50% for the 5. Unfortunately, the difference between 5S and 5 is far smaller than that between 5 and 4S. Therefore, the appeal of the 5, if it were not discontinued, would only surpass that of the 4S in the past year, and maybe even able to seriously challenge the 5S in sales. The problem of the middle tier is not that it's not appealing, it's maybe that it's too appealing, making the flagship device not able to stand out. Maybe Apple acted this turn not by improving the quality of the flagship (they can't), but by lowering the quality of the middle tier. 6. If the 5C could generate similar earnings per unit as the 5S, why is it bad for Apple if it eats too much into the 5S's market? Because the success of the flagship relates closely to Apple's brand image, and Apple's success is closely tied to its image. People don't care about the middle tier, the success of the flagship is what reflects the company's technical prowess, and this is a battlefield in which Apple can't afford to lose. I guess the sales numbers will tell who is right:), whether the 5C performs better than the 4S did in the last turn. [1] http://macdailynews.com/2013/07/22/iphone-5-accounts-for-half-of-apples-smartphone-sales-iphone-4s-takes-30/ http://macdailynews.com/2013/07/22/iphone-5-accounts-for-hal...

59 points by cuttooth 13y ago

> Take a look at apple.com today and note which new iPhone appears first the 5C, not the 5S. Which phone did they show a commercial for? The 5C. Which one will have a higher profit margin for Apple? The 5C.

clarky07 13y ago
perhaps. everyone assumed coming in to today that the "cheaper" version would hurt margins. Granted it was priced above expectations, I'm not sure it will have significantly higher margins.
- bryanlarsen 13y ago
  I think it will have higher relative margins than the 5S but lower absolute margins than the 5S. But that's just a guess. But what is relatively assured is that it will have substantially higher margins than the equivalent in their old strategy, a price reduced 5. So it's quite likely that the introduction of the 5C will increase Apple's overall margins rather than decreasing it, as everybody expected.
twiceaday 13y ago
Which one are they not taking pre-orders on? The 5S.
threeseed 13y ago
The 5C is not about a higher profit margin for Apple. It's about maintaining their current profit margin whilst offering carriers a bigger incentive to bundle and sell and their phones.

nwh 13y ago

They seriously need to fix their international pricing. For a 64GB model it's $913AUD to buy an iPhone 5s in the US, $1129AUD to buy one in Australia. What?

bowlofpetunias 13y ago
VAT, import tariffs etc. Apple doesn't need to fix anything.
- nwh 13y ago
  There's GST in Australia rather than VAT (10% vs 17.5%), and last year the prices were almost at parity.
  - deleted 13y ago
    [deleted]
  - recoil 13y ago
    Apple don't trust the AUD not to drop further than it already has in the last 3 months.
    - Jam0864 13y ago
      What a laughable excuse. It's been this way for years.
      - cremnob 13y ago
        Apple will adjust pricing based on currency. If the Australian currency is getting weaker it may be because the emerging markets that it depends on are seeing turmoil in their currencies because of the prospect of Fed QE tapering. http://www.telegraph.co.uk/technology/apple/4934147/Apple-ups-price-of-Mac-computers-as-exchange-rate-bites.html http://www.telegraph.co.uk/technology/apple/4934147/Apple-up...
        Jam0864 13y ago
        Apple has overcharged both in Australia and Europe for decades, even when the currency has been strong. It's simply because they believe that people who live there will stomach a larger price. It's probably true. It's still infuriating. It results in funny cases where a Nexus 4 can be 1/3 the price of an iPhone 5.

r00fus 13y ago

The 5C is important for one big reason: China. I expect the "unlocked" price won't reflect the kind of subsidies and discounts that China Mobile and Apple can give to make it affordable for their customers.

simonh 13y ago
I think the "C stands for China" is fair, but I don't expect Apple to break with their multi-decade tradition of maintaining the highest margins that are compatible with a viable market presence. Yes margins will be lower in aching than elsewhere, but they are not going to even attempt to compete with Android for market share because it would be utterly pointless. The Chinese mass market is dominated by extremely poor bargain bucket Android devices with invisibly thin margins that can barely scroll a web page. It is true that Samsung has a strong presence over there and Apple needs to deal with that, but the premium end of the market is big enough for both to do well. The kind of people who are likely to prefer an iPhone over there aren't as price sensitive as the average and charging them less just to also sell a few more units down market would just be leaving money on the table. That's not something Apple has a habit of doing.
- Tyrannosaurs 13y ago
  There's enough money in China that Apple can make some in roads but a bulk of the phones selling there are sub $200 (off contract) non-Google Androids. The 5C isn't going to take anything out of that market. Rather boringly I suspect the C stands for colour (or color if you must).
ttflee 13y ago
Reality check: 1. The spec published today is not suggesting that iPhone 5c/s would support TD-SCDMA networks which CMCC is bound to due to regulation reasons. And LTE-TDD is light year ahead for CMCC. 2. A difference of mere 800 CNY in price between 5c and 5s is not attractive enough to those who can afford 5,000+ CNY(, i.e. the iPhone 5s) in China. And in the past, smugglers carrying duty-free iPhones from Hong Kong in the first few months of sales may reduce the high price caused by the tariff and VAT. Now, Hong Kong is NOT even in the initial list!

stevep98 13y ago

> Next, it has an intriguing “motion coprocessor”, which I think pretty much means you can use your 5S as a fitness tracker with almost no effect on your battery life. My guess is that it's much more than this. It's for augmenting the GPS location with dead-reckoning, for places where the GPS location doesn't reach well, such as buildings or on subways, etc. Accelerometers are already pretty sensitive - enough to provide an improvement on GPS-only devices. But, this new coprocessor will allow a much higher-resolution sampling of the accelerometer, and thus the integration (in the calclus sense) of acceleration into velocity and distance will be much more precise.

derefr 13y ago
What I hope this really means is less battery drain for geofencing.
simonh 13y ago
Inertial navigation? It's an interesting idea, but I think if they were doing that, they'd have touted it in the presentation as an example of something they can do that nobody else is even thinking about. It's not like apple to miss an opportunity to try an distance themselves from the pack on their technical capabilities.
- rahoulb 13y ago
  One thing I noticed is that they said the 5S is a "forward-thinking" device, implying that they've got more planned for it.
inoop 13y ago
I doubt it's for GPS assistance. Motion sensors can be used to suppress Wi-Fi scanning and/or GPS localization during the roughly 89% of the time humans are not moving. Remember, phones continually scan for new Wi-Fi APs in the background even when the screen is off. On modern phones with a/b/g/n chipsets (32 channels to scan) and energy-expensive CPUs (i.e. Exynos) this takes a huge amount of power. Motion sensors themselves are really energy-cheap but the main CPU needs to be on to sample them, which basically means that if you want continuous mobility detection you're going to burn through your battery pretty quickly, which is why it isn't used much. You can do some CPU duty-cycling, but wake-up and suspend overhead is pretty bad and can amount to as much as 50% of the total energy spent. I haven't done any measurements on an iPhone, but a GS2 Exynos 4 is a terrible energy drain, while an something like an OMAP 4460 (e.g. Galaxy Nexus) is much more efficient. By offloading mobility detection to a separate chip you can bring down the overhead to tens of mW. The fact that you can use it as a step counter for jogging is just icing on the cake :)

hcarvalhoalves 13y ago

The 5S camera is killer. f/2.2, apparently a great sensor for the size and 120fps video is more than most pocket cameras offer. Manufacturers of point-of-shoot cameras can pack up and leave if this is a trend.

sspiff 13y ago
If lower end smartphones adopt this kind of camera (which I think is unlikely) then point-and-shoot cameras could have a problem. However, comparing a $600 iPhone to a $70 point-and-shoot is not really relevant.
- ubernostrum 13y ago
  If the expensive device is something people will buy and be carrying with them anyway for other purposes (phone calls, SMS, apps, etc.), then they have no motivation to additionally buy the cheap photo/video-only device and carry that with them. It's the same reason why, if there was a $20 Facebook device, a $20 Twitter device, a $20 SMS device, etc., they wouldn't sell very well since the phones people already carry can do those things without needing to purchase and tote around multiple other devices.
- runn1ng 13y ago
  just a note (for you and for everyone else): stop whining about downvotes. sometimes you are downvoted. it happens. but more often than not someone upvotes you again, and then it just look whiny, espescially if you are second comment on the page (as you are now).
  - sspiff 13y ago
    Point taken, removed the whiny bit.
- svantana 13y ago
  Well you're probably gonna need a phone anyway, so the question is rather why someone would pay $70 for an extra device rather than $70 extra for a phone with a good camera.

greyman 13y ago

I am curious to see how those two will sell. I can't imagine myself to buy the not-so-cheap 5C, when for 100 eur more, I can have faster processor (which will be important thing for iOS7), much better camera, non-plastic body and other things.

T-zex 13y ago

Nokia designers should be proud of themselves for setting a colorful plastic case trend for the smart phone market and even influencing the iPhone.

Steko 13y ago
Apple's following the exact same playbook they wrote with the imac and ipod where they focussed heavily on the primary form factor for several years and then threw open the gates to colors. http://www.fastcodesign.com/3017050/untold-stories-inside-apples-love-hate-relationship-with-color http://www.fastcodesign.com/3017050/untold-stories-inside-ap...
threeseed 13y ago
Nokia's designer and product managers have nothing to be proud of in its history. They let companies like Apple, Samsung etc come in and dominate what was their industry to own.
- drill_sarge 13y ago
  I have a Nokia 3210 as backup phone which still works flawless today. Or an E-7, still working. Most of the other phones I had went defunct at some point or the non-replaceable battery went dead and new phone was cheaper than getting it replaced and so on. Thats something to be proud of. Ok, maybe not for the product managers ;)
- T-zex 13y ago
  I agree about the product managers, but I don't think that designers are to blame for the failures in the smart phone market.

nagarjun 13y ago

I think the iPhone 5S Fingerprint Reader is revolutionary because it is invisible: http://t.co/AfQSFqAjBy http://t.co/AfQSFqAjBy.

josteink 13y ago

> Yes, it’s plastic, but there’s nothing cheap about it. Hard back-pedalling on plastic observed.

halfninety 13y ago

My opinion is the exact opposite. I don't think the 5C is an appealing middle tier, I believe it's a dumb middle tier, and maybe intentionally so, to make the premium offering stand out more. 1. If it's intended to be appealing, why call it "5 Cheap"? Okay, Apple didn't call it "5 Cheap", but everyone thinks so, and in marketing, what consumers think is the truth. Additionally, Apple didn't try to correct people when everyone thought it would be cheap. Who is gonna buy a phone that is "cheap" but not cost effective? 2. The 5C isn't that appealing against 5. Yes, a new product is a new prodcut, but a flagship is a flagship. In emerging markets, why do people spend a month's salary for a phone? Because they want to show off to ohters, or at least so that people can't show off to them. Which one do you think have more "show off" power? The previous year's flagship (people don't know when you bought it) that looks identical to this year's flagship, or the "cheap" alternative? 3. The colorful back is suitable for really cheap devices, not seemingly cheap but actually expensive ones. They are liked by young people, mostly students, and new graduates. They don't have much money, and prefer cheaper devices. The 5C isn't cheap. Premium products are never colorful, for a reason. 4. The 5C is a worse product than the 5, technically. It probably has only about 10% larger battery capacity, but is 18% thicker and heavier. I can imagine how many cheap materials are used to make that happen. 5. If you look at the big picture, the trend is smaller and smaller differences between generations of iPhones. And because of the diminishing differences, people are more and more likely to choose an older generation for a cheaper price. According to one source[1], the 4S commanded 90% of all iPhone sales immediately after launch, and almost 75% a year later, before the 5 was launched. The numbers are 70% and 50% for the 5. Unfortunately, the difference between 5S and 5 is far smaller than that between 5 and 4S. Therefore, the appeal of the 5, if it were not discontinued, would only surpass that of the 4S in the past year, and maybe even able to seriously challenge the 5S in sales. The problem of the middle tier is not that it's not appealing, it's maybe that it's too appealing, making the flagship device not able to stand out. Maybe Apple acted this turn not by improving the quality of the flagship (they can't), but by lowering the quality of the middle tier. 6. If the 5C could generate similar earnings per unit as the 5S, why is it bad for Apple if it eats too much into the 5S's market? Because the success of the flagship relates closely to Apple's brand image, and Apple's success is closely tied to its image. People don't care about the middle tier, the success of the flagship is what reflects the company's technical prowess, and this is a battlefield in which Apple can't afford to lose. I guess the sales numbers will tell who is right:), whether the 5C performs better than the 4S did in the last turn. [1] http://macdailynews.com/2013/07/22/iphone-5-accounts-for-half-of-apples-smartphone-sales-iphone-4s-takes-30/ http://macdailynews.com/2013/07/22/iphone-5-accounts-for-hal...