Apple screwed up the ‘iPhone 5c’
Why the iPhone 5c should never have been called the iPhone 5c
Apple recently launched a pair of new iPhones, namely the iPhone 5s, which is the successor to the iPhone 5 and a new line of iPhones titled the iPhone 5c. The reactions appear to be mixed on both new phones.
New iPhones seem to be announced every year with upgrades on the previous year’s versions — so that is nothing new.
Traditionally what has happened with an iPhone refresh is that the current model gets replaced by a new model, and the the 2 previous iPhone models fall down a tier.
So when the iPhone 5 launched in 2012, it became Apple’s flagship phone selling for $199 on a 2-year contract, while the current phone at the time, the iPhone 4s was bumped down to $99 on a 2-year contract and the iPhone 4 (from 2010), was dropped to $0 on a 2-year contract.
However, as mentioned in Apple’s keynote of the 5s/5c launch, this was the first time Apple replaced its iPhone lineup, with not 1 but 2 new iPhones.But the question is, are they really 2 new iPhones.
The entire launch of the iPhone 5s and 5c were rumoured for a long time and practically every tech blog on the internet had a beat on what was going to released by Apple. (Here’s a BGR article with what to expect from the iPhone 5s, and iPhone 5c, a day before the announcement.)
This is where Apple screwed up.
By calling the iPhone 5c, which is essentially the same (internally) as the iPhone 5 with a plastic coloured casing on the outside, a brand new phone — Apple lost its lustre of new product announcements.
The iPhone 5c, has been heavily rumoured to be Apple’s entry into the mid-range smartphone market and was hinted to as the “Cheap” iPhone (C for Cheap). It was going to be the way Apple would gain market share in emerging markets like China and India, where customers are much more price conscious. As it turns out, with a price tag of $549 off contract, C actually stands for colour more so than it does cheap.
Effectively what Apple has done with the pricing and launch of the new iPhone 5c, is replaced the position the iPhone 5 would have traditionally taken. (Do you see the resemblance between the following picture and the one above?)
The iPhone 5c, heralded to be Apple’s entry into the crowded mid-range smartphone space as a cheaper, entry level iPhone is actually priced at $549 off contract. It is now the mid-tier phone in the iPhone lineup.
Where Apple screwed up, is that the 5c became synonymous with being the Cheap iPhone (no one really predicted the C would be more for colour) and so when it was released as the mid-tier phone with not such a cheap price — everyone started to call it a flop. (Although I don’t necessarily agree with that conclusion, I can see where it is coming from. But that is not the purpose of this post.)
It was expected that the 5c was going to be low-cost phone that would sell like crazy in China and India and when that wasn’t the case, Wall Street reacted. People reacted.
Here’s what Apple should have done:
Apple should have called the iPhone 5c, the iPhone 5 — 2nd Generation.
Its very subtle and yes, its just a name, but it wouldn’t have the stigma and expectations associated with 5c being regarded as the cheap phone that was actually not cheap.
If you really think about it, that’s all the iPhone 5c really is — its a phone that replaces the iPhone 5, with a plastic rear casing that comes in different colours. The same thing could’ve been done by calling it the iPhone 5 — 2nd Generation, which is in line with the naming convention Apple uses for its iPads since the iPad 2.
The new lineup could have looked like this:
iPhone 5s — the top tier flagship phone at $199 on contract
iPhone 5 (2nd Generation) — mid-tier phone at $99 on contract
iPhone 4S — entry-level at $0 on contract
This would have still allowed Apple to release 2 new phones, but just brand the mid-tier phone as iPhone 5 — 2nd generation, a “beautifully, unapologetically plastic” (read in Sir Jony Ive’s voice) iPhone.
Regardless of what the phone is called, Apple will likely sell several million of these devices once all is said and done, but maybe by calling it the iPhone 5 — 2nd Generation, they could’ve sold more. (We’ll never know).
So here’s to the iPhone 5 — 2nd Gener…I mean iPhone 5c.
Disclosures
I am long $AAPL and use many Apple products, if that is something you care about.
Shubham Datta is passionate about technology, startups , sports, and investing. He earned a Bachelor of Mathematics from the University of Waterloo and is an aspiring CPA at KPMG. You can find out more at www.about.me/ShubhamDatta.
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