Samsung and Apple, two of the major leading companies in the global technology market, have competed against each other more fiercely than they have with any other company for the last few years, both having taken the top leading position at some point of time. During holiday season, Apple temporarily achieved the number one position in America, having grabbed hold of nearly 53% of the domestic market. Samsung has the lead currently, however, and is looking to expand in 2013 with the release of new flagship devices and its ‘larger multitier product portfolio’, according to Neil Mawston, executive director of Strategy Analytics.
While Samsung builds its lead over Apple, there have been several analysts who have contemplated what Apple’s counter move will be with heavy speculation pointing to the iPhone Mini being its ace in the hole. The iPhone Mini is primed to be a smaller, cheaper iPhone and may be designed to have a more affordable price tag for consumers compelled to forgo the expensive current version of the iPhone. Mawston, however, firmly disagrees that the iPhone Mini is Apple’s strategy to undercut Samsung’s sales this year. He believes that given the immense success of the iPhone 5, Apple can easily sustain itself with the sales of its latest smartphone until it launches the iPhone 5S or the iPhone 6.
To further emphasize Mawston’s point, Strategy Analytics expects Apple’s global market share to rise from 20% to 21% this year as well as a 27% increase in shipments, bumping up its total to 875 million smartphones. Given this steady flow of successful sales, some analysts firmly believe that Apple will neither need the iPhone Mini to undercut Samsung’s profits nor will it need to introduce a device that compromises its pricing any time soon. Apple has followed a certain trend of introducing smaller, sleeker devices without lowering the price but most analysts strongly believe that the iPhone Mini will be a cheaper device.
To arrive to a fair estimate of how much the iPhone Mini will cost, one can compare the prices between the iPad and the iPad Mini. Apple could have sold the iPad Mini for $249 to compete against Google’s Nexus 7 and Amazon’s Kindle Fire but it chose to price it at $329 instead, maintaining that it would not compromise the premium status of its products. The strategy did work, evidenced by the millions of iPad Mini units sold in the holiday season and it is thus likely that the iPhone Mini will be priced 30% cheaper than a regular iPhone. While this would still be too pricey for low-income consumers, Mawston believes that Apple will hold off releasing the cheaper device either in the next three years or until it needs to generate ‘fresh growth streams’.
