iPhone 5C Not Cheap Enough, Says Analyst


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Yesterday Apple held its yearly iPhone presentation, unveiling the anticipated iPhone 5S and iPhone 5C smartphones. No surprises were seen in the hardware, which had been heavily leaked in the months leading up to the announcement. The price, however, had been much debated in the lead-up to the Apple event. Now, with the lowest price of the iPhone 5C set at $99 with a two-year contract, it remains to be seen whether the colorful new device can compete in the markets Apple intends it to.

Market research firm IHS today jumped out with a prediction on the matter, stating that the price of the iPhone 5C is not quite low enough to compete, particularly in emerging markets such as China and Brazil, where market watchers have predicted smartphone growth will be centered in the coming years. Though the price tag is low for an iPhone, the firm predicts that the unsubsidized price of the iPhone 5C will not entice buyers in the market for low cost phones. In emerging markets, Apple will be pitting the iPhone 5C against a range of even lower-priced Android-based handsets.

"At an unsubsidized cost of $549, the iPhone 5C remains at the same price point as the existing mid-range model in Apple's smartphone line, the iPhone 4S," said Francis Sideco, director of the consumer electronics division at IHS. "In light of this pricing, the 5C appears to be a midrange product that cannot significantly expand the available market for the iPhone line to lower-income buyers. As a result, the arrival of the 5C will not spur a major increase in iPhone sales in the second half of 2013 compared to previous expectations."

Though IHS does not expect the 5C to significantly increase Apple shipments, the firm is still predicting an overall increase in Apple's shipment numbers. It sees iPhone shipments hitting over 86 million units in the second half of 2013, up from 68 million unit shipments during the first half of the year.