iPhone 5SE: Right phone for expanding Apple markets at right price and right specs - but boy is this years LATE for Apple

Good move from Cupertino. The iPhone 5SE is pretty close to optimal for Apple's so-called iPhone Nano strategy (which I called for five YEARS ago). The specs are slightly upped from the 5S and 5C, so this is a 'new' phone while its superficially essentially the same body of the iPhone 5S from 3 years ago. No problem, it now adds a better camera, the Apple pay functionality to the fingerprint scanner and tons more performance as 3 years would allow. The best part is the price. As the 6 series moved up-scale in price (as I urged Apple to do) now this latest Nano is finally priced 'low enough' to create distance and gain in pricing (when the product line was initially split with 5S and 5C, the price differential was not enough to help gain market share). So the unsubsidised price for the 5SE is 399 US dollars which is significantly less than the cheapest new 6 model, starting at 649 US dollars (unsubsidised price ie price without contract bundle, the only fair way to compare actual phone prices).

Now my minor quibble is with the naming, why not make this the 6SE or 6C, but who cares, its a genuinely new iPhone, it is internally mostly a repackaged 5S with some better tech. Its thus a fair entry-level iPhone - bearing in mind, thats like calling the Boxter its entry-level model which it obviously is for Porsche but that doesn't make it the peoples' car haha. At 399 dollars unsubsidised, the cheapest iPhone is still twice as expensive as the AVERAGE smartphone globally (which would run Android obviously).

The iPhone unit sales were set to decline this year. So they (finally) rushed the iPhone Nano strategy into play (as I said, they won't do it this way until the pressure comes from the market in terms of sales having peaked). Now they finally split the launch dates for one new iPhone or iPhones in the Autumn - for Christmas sales - and the second new iPhone launch window - the Spring launch. This makes sense and helps remove the weird volatility of iPhone sales from one quarter to the next. And all this means, the iPhone will pick up significant new sales, new customers, and also modestly some market share as well. I don't anticipate Apple to return to 20% market share but something around 18% is definitely possible for this calendar year 2016. Will this iPhone 5SE cannibalize 6 series sales. No it won't. Yes, some who really HATED 'too large' size of the 6 series will now switch but that is a very slight slice of loyal iPhone owners. Most do love the larger screens. You now get the better camera and the Apple pay functionality plus various tweaks and boosts to the junior model performance. But now of course the heavily addicted iPhone owners will await the iPhone 7 for the cool stuff. This is the entry-level model to help expand Apple's reach in less affluent markets, maintain its high desirability and win new converts to the Apple cult. A very smart move, the only problem I have, is that this is exactly the strategy that I outlined five YEARS ago when Apple should have done this. But that is money left on the table, Apple has managed just about ok in the interim haha, most profitable company in human history etc.. So they didn't exploit their market perfectly? Only a strategy consultant might quibble with that haha. 

Comments

[E.Casais]

"Why should those users downgrade to a screen size from 5 years ago?"

This is the problem in your reasoning. A smaller-screen device is not "downgrading".

(a) Having a choice is great -- enough people complain about the monopolization of large display form factors.

(b) In this perspective, the new Sony Xperia compact models have been well-received; there is truly a demand for something else than phablets.

(c) Since the very beginning, Apple contended that a mobile phone should be easily operable single-handed; the new iPhone 5SE rebalances the portfolio according to that principle.

We should remember one essential point: a mobile phone is not a miniaturized version of a PC. The evolution to ever larger displays is an indication that developers have been trying to force-fit inadequate content ("busy" multimedia apps), WWW (overcomplicated, overstructured Web pages) and UI (multiple windows) from PC onto mobile devices -- and since all this does not downscale well, manufacturers have compensated by expanding phone displays.

While this may be ok for young people with a good vision, it barely helps beyond a certain age, when the difference between 5" and 6" is negligible -- one truly needs 10", 12" or 15", i.e. a full-fledged tablet or laptop as a minimum for today's Internet content and services.

This also implies a new emphasis on well-crafted apps optimized for mobile displays -- the strength of Apple -- away from standard Web -- the weakness of Apple, whose Safari browser has been dubbed "the new IE" for a couple of years already.

[Paul]

@E.casis

> A smaller-screen device is not "downgrading".

Yes, it is. A smaller screen device is "downgrading" and even the price shows that.

[neil]

>"Yes, it is. A smaller screen device is "downgrading" and even the price shows that."

You're projecting your particular wants and desires onto other people Paul. Kantar reports that only 21% of all US smartphone sales in Q1 2015 were phablets and Apple iPhone 6 Plus took 44% of this segment. Flurry reports that only 27% of phones were phablets in Q4 2015.

Screen size was cited as the main reason for buying a particular phone by both iOS and Android buyers at 43% and 47%, respectively which means a majority on both platforms didn't feel it was the main reason for buying a particular phone.

There has been a very loud chorus of complaint from Apple users that Apple hadn't released a small, but fully-featured phone as the number who can't or don't want to fit a phablet in their pocket is significant.

Personally I prefer my big 5.5" iPhone 6+, but I can still respect others like my wife who prefer to have a small phone and a larger iPad combination. Even I sometimes feel like a dork holding a dinning table to my ear when making calls. ;-)

[neil]

@tester,
It's iPhone SE, not 5SE.

With all the internals from the flagship iPhone 6S, you're getting hung up on form factor.

I agree with Tomi, this little beastie is going to sell like hotcakes.

[abdul muis]

@neil

"Screen size was cited as the main reason for buying a particular phone by both iOS and Android buyers at 43% and 47%, respectively which means a majority on both platforms didn't feel it was the main reason for buying a particular phone."

Can you give me the link of the source? I wonder if this data is from the day that iOS user know that big is better or it's old data before iSheep were freed from the small screen.

---------------------------- BECAUSE ----------------------------

it's contradict with what you said before:

"Apple executive Greg Joswiak noted that Apple sold more than 30 million iPhones with four-inch screens in 2015 — iPhone 5s and 5c devices.

That also means Apple sold around 200M big screen iPhone 6/6+/6S/6S+ models out of the 231M iPhones sold last year."

[neil]

@abdul, The problem with the old 5s and 5c small screen choice was they were old slow tech so of course power users who wanted a smaller screen would be far less interested in them. No contradiction there.

Flurry (global data) Dec 2015:
http://www.androidheadlines.com/2015/12/phablet-market-share-grew-significantly-holiday-season.html

Kantar (US data) Q1 2015:
http://www.kantarworldpanel.com/global/News/US-phablet-market-soars

Flurry also has this to say:
"From all the devices running on Android, 50% of them are phablets, while Apple users seem to like the smaller iPhone more."

And Abdul, do you really have to use the pejorative "iSheep" label? We are all adults here, can't we keep our dialogue on a mature level?

[Paul]

@Neil

> You're projecting your particular wants and desires onto other people.

There is not such statement in any of my posts. Now again you are attacking me instead of answering to my posts! That is a loser strategy Neil and also very lame!

[Paul]

@Neil

>.. do you really have to use the pejorative "iSheep" label?

Neil, do you feel like belonging to iSheep?

[neil]

@abdul,
Oh, I should also clarify - Flurry classes phones from 3.5" to 4.9" (which includes the 4.7" iPhone 6 and 6S) as "medium size" phones) and 5" and above as phablets. Likewise, Kantar only classes the 5.5" 6+ as a phablet.

In contrast, Apple's 30M figure is only for the 4" iPhone 5/5s so you can't compare those figures directly.

[neil]

@paul
>"There is not such statement in any of my posts"

On the contrary Paul, you present your belief that a smaller screen is a downgrade without presenting any evidence to back it up. That is personal anecdote, not objective observation backed up by data.

>"Neil, do you feel like belonging to iSheep?"

And you claim I am attacking you instead of answering your posts *rolls eyes*. How about addressing the content of my post which shows the popularity of smaller phones over phablets?

So when do I get to yell the old "troll" accusation because of others continually slinging insults and engaging in ad hominem attacks? *sigh*

[abdul muis]

@neil

"On the contrary Paul, you present your belief that a smaller screen is a downgrade without presenting any evidence to back it up. That is personal anecdote, not objective observation backed up by data."

I think Paul reason is very subjective & I agree with him. He said, I quote "even the price shows that."

The main reason that this iPhone SE is with almost the same internal part with the latest iPhone is cheaper is because it's small screen. Thus, one can assume that the price really show that.

[abdul muis]

@neil

"And Abdul, do you really have to use the pejorative "iSheep" label? We are all adults here, can't we keep our dialogue on a mature level?"

Why? Do you have a problem with that? Tomi also use the words iSheep? Do you have a problem with him usin that words?

I carefully use the words iOS user and iSheep to seperate the iOS user before and after the introduction of other screen size to iPhone. Before the '6', iOS user mere an iSheep that agree with Apple that 4" is a must.

[abdul muis]

@neil

For clarification.... You were implying that
1. Since more than 40% of iPhone user were satisfied with the screen size
2. Because since 2 years ago, there were no small iPhone with latest hardware

Therefore, iPhone SE could sell at least as much as the iPhone 6Plus?

[John Phamlore]

The iPhone SE has such up-to-date innards because at this point of time it simply does not cost Apple any more to use its latest SoC, and using it might actually simplify things.

This device should do well in First World countries, its target market. For those countries $399 USD is an accessible price point.

Elsewhere I am not sold on this device being able to be marketed as a status symbol device, nor am I sold on it being a complete computing / content platform replacement.

[mark]

Apple is not a tech company. They are a marketing company. Steve Jobs wasn't a tech guy. He was a marketing guy. But also a tech idiot who could market to other tech idiots.
The reaction to this Apple product announcement is clearly ho hum. Look at say ETC NEWS on youtube with their APPLE IS BORING video. Look at Jimmy Kimmel's video where they show TWO iPhone Fives to clueless tech idiots on the streets.
For a marketing company, Apple is slipping. New mediocre products are starting to hurt the brand. (an iPhone for people with small hands? really?)
Followers of marketing strategies will find the Apple case an interesting study for years. Maybe someone will one day buy the brand and revive it not unlike what happened to Fender Guitars in the 90s.

[abdul muis]

@Lulz

"Some people seem to have problem understanding how iPhone SE is a phone for those who want to use a 4" device. An upgrade or a downgrade (feature-wise) is not that much what matters. What matters is that there is now a great choice for 4" users. If iPhone SE could sell 60 million this year, that will be huge. It would also mean that Apple would be able to gain market share in 2016."

I'm NOT saying that iPhone SE will sell less than the phone it replace. At the start of this article I clearly say Apple should give credit to Tomi, and I also say This won't sell in Asia, because Asian mid-level-user value function over ego. I also say I don't know if European still like 4", perhaps some European can enlighten us.

What's I'm arguing here is the statement from someone that this will have GREAT impact on mid-range android. No, I don't think so. Some of the mid-range user will flee to iPhone, but it won't have great impact.

I don't think those Apple user who already buy the big-screen iPhone will downgrade to small iPhone. My guess, some will buy it, swear by it, but after several months will go back to big-screen.

I think the one who might be buying it were the one that use the phone as a phone. Not as smartphone. Because typing SMS or What'sApp in 4" screen is a pain in the ass.

[Paul]

@Neil

> >"There is not such statement in any of my posts"

> ... a smaller screen is a downgrade without presenting any evidence to back it up.

Neil you purposely TROLLING here! I wrote very clear in my post why iPhone 5SE is a downgrade but you on purpose ignore it and then state I didn't present any evidence! Your only purpose here is to present iSheep propaganda by using marketing bullshit.

Here I show again my statemet such that you cannot ignore it "A smaller screen device is 'downgrading' and even the price shows that."

Neil, do you have any connections to Apple?
Neil, is Apple paying you in any way for praising Apple's products here?

[Paul]

@Neil

> ... 200Bn cash mountain... biggest company on stock market...
> biggest profits in corporate history...

Neil, Tomi has made it very clearly that here are no posts about profits and stock market! You are breaking Tomi's rules.

[Paul]

@Neil

>>" I wrote very clear in my post why iPhone 5SE is a downgrade"

> No you didn't.

Yes, I did! Even Abdul Muis has brought this to your attention but you choose to ignore that fact/post!

Here it is again for you: "A smaller screen device is 'downgrading' and even the price shows that."

Neil, you are not answering my questions regarding the any connections between you and Apple! Do you have anything to hide?

> >"Neil, Tomi has made it very clearly that here are no posts about profits and stock market!"

> If Mark is going to post a comment about someone buying Apple,
> how else can one answer than to remind him how much it would cost them?

I do not care how you could answer to Mark. The point is these are Tomi's rules and there not my rules. Obviously you have a problem with Tomi's rules. You already have been banned once by Tomi when you were using the nickname Rocwurst.

> Your continual "TROLL" accusations and personal insults are getting very old.

Indeed they are old by they are true.

[neil]

@paul
>"Neil, you are not answering my questions regarding the any connections between you and Apple! Do you have anything to hide?"

I've answered that before by reminding you that it is Samsung who has admitted to, been found guilty of and been prosecuted for astro-turfing and comment spam in Taiwan, not Apple (as if they would bother about a forum such as this).

So I guess based on historical precedent I should be asking you the question:

Paul, is Samsung paying you in any way for praising Android products here? ;-)

However, I won’t stoop to such silly immature accusations unlike some people here.