What We Learned From the Recent Apple Launch?

Posted by Kirhat | Wednesday, March 30, 2016 | | 0 comments »

Greg Joswiak introduces the iPhone SE
The low-profile and less-publicized launch, held at the technology company's Cupertino, California campus rather than its traditional splash at a much larger venue in San Francisco, did not impress tech experts or investors as much as Apple was hoping to do.

However, the new mid-range model was seen as necessary to counter the dominance of cheaper phones running Google's Android system.

"There are people who want that smaller screen size," said Bob O'Donnell of TECHnalysis Research. "You do a price cut when you need to drive the market a bit more," though he questioned if the price was low enough to generate significant demand.

Apple is hoping the cheaper model will stimulate overall iPhone sales, which it expects to decline this quarter for the first time since it essentially created the smartphone market nine years ago.

The new model did not allay investor concerns that Apple, which celebrates its 40th birthday on 1 April, has no obvious blockbusters in its pipeline.

"Apple is so big now that nothing seems to be earth-shaking anymore, and the strategy seems to be turning to offering complementary products like watch bands so they can maintain their sales momentum," said Skip Aylesworth, portfolio manager of the Hennessy Technology Fund.

The company showed off new wristbands for the Apple Watch and a new iPad Pro tablet at the 21 March event, and an interesting robot called Liam to take apart old iPhones and reuse the materials. Unfortunately, none of those moves generated an epic excitement among investors.

Apple shares fell in the afternoon and were down about US$ 0.15 at US$ 105.77. The stock is down 20 percent from its all-time high closing price of US$ 133 in February 2015.

The iPhone SE's 4-inch screen is the same size as the iPhone 5c, which fizzled and is no longer available on Apple's online store. The iPhone 6s, which previously had the smallest screen of the sixth-generation line-up, is 4.7 inches.

The new phone has a 12-megapixel camera and starts at $399 for 16 GB of memory.

The model represents Apple's second bid for the crowded mid-tier market after an unsuccessful foray three years ago. Orders started last 24 March, and the phone will be available a few days after that.

The starting price is well below the US$ 649 for the current top iPhone model without a contract, which is beyond the reach of many. With Apple's vaunted A9 chip, the new phone is twice as fast as Apple's previous attempt at an entry-level phone, launched in 2013. It also runs Apple Pay and comes in the wildly popular rose gold color.

The more compact phone design comes after Apple expanded the size of the screens in its high-end iPhone 6 and iPhone 6 Plus phones in 2014 to as large as 5.5 inches. That was broadly seen as an attempt to match rival Samsung Electronics with its large-screen Galaxy phones.

Apple is still expected to introduce a top-of-the-line, large-screen iPhone 7 late this year. The company now appears to be following a two-pronged approach to attack the top and the middle of the smartphone market.

"If these smaller phones are a gateway into the Apple ecosystem then over the long term it improves Apple's chances of growing at a comfortable rate," said David Meier, a fund manager with Motley Fool Funds.

Reaction to the multi-model strategy was mixed on social media.

"So what's Apple's line-up next year? iPhone 7, 6s and a new SE?" tweeted Benedict Evans, a partner at venture capital firm Andreessen Horowitz. He also posted an image of several iPad models with the caption: "Please tell me this is getting cleaned up."


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