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Apple’s iPhone

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Since the dawn of the cell phone entering into the mainstream commercial market, the latest greatest gadget has been the desire of techies and teenagers alike. For the last couple of years Apple’s iPhone line has become one of the most produced and sought after piece of technology. Only in the last two years or so have the Android phones been able to keep up with the demand for smart almost limitless capable phones. In recent months there has been a slow in sales for the iPhone 5 yet that hasn’t stopped Apple from turning the wheels, as we approach the release date for the iPhone 6. So where is Apple headed with these iPhones?

Primary Revenue

It isn’t a secret that the basis of Apple’s major success in recent years has been the popularity and demand for the iPhone. It’s like a phone, it’s like a computer, and it’s like a computer…with a camera. The iPhone may not have been the first smart phone, but it has definitely set the bar for how smart phones are expected to perform. So it would only be rational to understand that 56.4% of Apple’s entire profit within the last quarter has been generated by the iPhone sales.

A Slowing Market

Concerns that have plagued Apple’s sales over the last quarter are not concerns based in vain. Many phone manufacturers have also noticed that there has been somewhat of a decline in the demand for the higher end versions of smart phones. Earlier in the month, tech analysts and critics of the iPhone were calling the iPhone 5c a total disaster for Apple. However, while demand may have slowed down, sales are in fact starting to pick up. Apple says the reasons behind it are less affordability of the product or lack of desire for it, and more about how the mobile carriers were running their networks.

Apple and Samsung alike have begin the steps towards saving money on production costs by cutting production to meet demand, and not over producing. Analysts believe that if the production remains cut, that demand could sky rocket within the next several iPhonemonths. And while that may very well be possibly, it isn’t likely as the production of phone is being cut down to only 38.5 million phone to be constructed in the second quarter. The iPhone 4s is still in high demand as well as the iPhone 5s, and there are rumor circulating about the release date of the upcoming iPhone 6.

Apple isn’t the only one that is seeing a decline in the demand for their smart phones. Samsung has noticed that there is also a slowdown in demand for their Galaxy 3 and Note 4 phones. However, the key to their success falls on their lower priced models.


Is the Market Improving?

The North American Market is slowing down, but in other regions in the world, the demand for the iPhone is actually increasing at a greater level and speed. The reasoning being retailer and carrier promotions being more effective. In North America over the last year, we noticed that the carriers were being more strict on their 2 year service contracts. Just like any other industry, if you are locked into a contract making it nearly impossible to get out of the contract early and cost ineffective; then you are likely not to contest it.

Apple doesn’t classify the market as easily as most American based companies would. Because Apple operates on a global scale for the bulk of its manufacturing, the market when referred to by Apple is a global based reference.iPhone

Apple saw the success that Samsung was gaining with the lower priced versions of their smart phone lines and tried to replicate it. The iPhone 5c which many see as an utter failure by Apple, tried to address that side of the market. The iPhone 5c offered less storage than a traditional iPhone but became an instant hit in the other markets. So failure on the North American front didn’t kill Apple’s ambitions globally, because sales remain strong for the iPhone 5c in places like China.

Where is Apple Headed?

If the past has taught us anything, it is that the genius behind Apple’s success comes from its ability to work outside of the box. Before Steve Jobs passing, he had alluded to the possibility of an Apple TV. CEO Timothy D. Cook has in the past expressed uneasiness towards an Apple TV, while in production, continued saying it was not the correct direction for the company at this time.

For now, Apple’s best course of action to is secure itself in its money maker. Fix the issues that have plagued the iPhone 5c and secure what has contributed the most to their overall profit. As a company Apple is both strongly based and perceptive enough to evolve with the changing markets. But it will be entertaining to see what Apple has in store for us all in the coming months.

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