Industry readies for Apple’s mid-tier assault

Industry readies for Apple’s mid-tier assault

Fears of manufacturers being forced out of the UK market have been raised by industry insiders ahead of the anticipated launch of a new mid-tier Apple iPhone device.

The UK mobile industry is readying itself for a new iPhone following the removal of the iPhone 5c device from the market. The Californian manufacturer is anticipated to be launching a cheaper, more compact handset at its next keynote address in the spring.

Many in the industry have suggested that if Apple’s dominance of the high end were to extend further, rival manufacturers may have to exit the market. One industry source told Mobile: ‘I just hope this move is resisted by the operators – at the moment the high tier is dominated by iPhone. If it begins to dominate the mid to low tier too that could cause a number of players to exit the market.’

Retail anticipation

Anticipation among some retailers for the new device has been positive, however, with the hope that its launch will generate interest among consumers.
Andrew Harrison, Dixon Carphone’s deputy CEO, said: ‘There are strong rumours that it will come out of the normal cycle. I think that Apple has done a great job of changing the range of the products it sells, and moving products that are not the latest down to make them more affordable.
'There hasn’t been a low-cost one that’s been introduced as of yet, but we think any launch will be exciting for the market. I think it’s also off the back of the iPhone 5c being removed from the market, so it’s more of a replacement for that.’

Harrison’s thoughts were echoed by his colleague Seb James, Dixons Carphone’s CEO, who praised the role the previous mid-tier device had played in the market, as well as suggesting that the timing of the launch could coincide with the launch of the latest Samsung device: ‘We liked the iPhone 5c – it did a real job in the market, a lot of people liked it and it was a good lower-entry phone.
'And we’re hopeful this is something that might fill that gap. The rumour is that it will launch around the time that Samsung is launching the new Galaxy S7, so there could be a bit of that in it as well.’

Service push

The past couple of years have seen a major push from Apple into services, the brand’s payment service in particular – Apple Pay – has received a lot of attention from the brand. Ian Fogg, head of mobile analysis at IHS Technology, believes that part of the strategy behind a potential new handset would be to increase the market for people using these types of services.

He said: ‘It’s clearly a rumour at the moment and it will depend on what the product features once it’s announced. I anticipate Apple will look to expand the market for services such as Apple Pay, which the older devices do not have the capabilities to support.

‘It will continue to put pressure on the competition, but the competition already has significant pressure on it so there won’t be dramatic change. Were Apple to change its strategy and offer modern hardware at a lower price point, that would be different.’

Mobile had contacted Apple and was yet to receive a response at the time of going to press.


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