The good news for Apple is that a recent study by Umeng found that 8 out of 10 high-end smartphones in China, defined as those costing $500 or more, were in fact iPhones of one sort or another, so Apple is controlling the high end of the Chinese market just as it has controlled the high end of the U.S. market.
According to comScore, for the period ending January, 2014, the latest figures available, Apple was at the top of the U.S. subscriber heap with a 41.6 percent market share.
We know the iPhone is selling well, but we are left to parse various sources to figure out how it breaks down.
According to the data from Umeng, iPhone 5c sales in China at least have been dismal. According to a chart posted on Andreessen Horowitz analyst Benedict Evan’s blog, iPhone 5c sales in China are in the 2 percent range compared to the 5s, which is at around 12 percent and the iPhone 5, which is around 15 percent. The odd part of this equation of course, is that the 5c is basically the 5 in a colorful plastic shell, but it’s that design that people appear to be rejecting.colored plastic is not what they are looking for in a smartphone. Part of the problem is that even though the phones have been highly discounted by carriers, at least here in the U.S., it’s not clear the discounts are driving sales. Consider that Walmart was offering the 5c for just $45 with a two-year contract last fall, and that was after Best Buy had dropped the price to $50 with a two-year contract.
Last week, Apple, in what would seem to be a tacit admission that sales weren’t going as well as they’d hoped, introduced an even cheaper version of the 5c with 8GB of storage for £429 in England without a discount. That’s $729 U.S. for what amounts to last year’s iPhone in a colorful plastic case with a small onboard hard drive. No wonder they aren’t flying off the shelves.
Benjamin Robbins, principal at Seattle-based mobile consulting firm Palador, told me that maybe the 5c is doing poorly across markets because people buy Apple for the prestige factor, and nobody really wants to get a cheaper one. He said this has always been true of Apple because cheap simply isn’t in its DNA, no matter what the pundits might suggest.
“Apple’s brand always has been exclusive in nature,” Robbins told me. “Apple’s marketing team excels at portraying an elite experience and lifestyle that one would have through ownership of their products. Apple can’t have it both ways. It can’t be the penultimate tech product to own and the low-budget leader at the same time. Just as Android struggles to do cool, Apple struggles to do cheap.”
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