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Why iPhone 5s Is Outselling iPhone 5c Two to One

Why iPhone 5s Is Outselling iPhone 5c Two to One
October 14, 2013 9:53AM

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“The Apple iPhone 5c has seen ‘dismal sales’ so they are cutting production by 50 percent. We just simply aren't used to hearing the words Apple, iPhone and low sales in the same sentence. Fortunately the iPhone 5s is still hitting it out of the park. Especially the gold version,” said Jeff Kagan, an independent wireless analyst.

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AllThingsD posted a dramatic headline this morning that has the smartphone industry talking: iPhone 5s Outselling iPhone 5c Two to One.

That’s surprising to many, who were betting that a lower-priced iPhone would sell like gangbusters in a market where cheap Android devices perform well.

The iPhone 5c sports an all-new design in five colors. It doesn’t skimp on technology, offering a 4-inch Retina display, a fast A6 chip, the 8 megapixel iSight camera and more LTE bands than any other smartphone in the world. The device also offers a new FaceTime HD camera, and iOS 7.

At the launch, Philip Schiller, Apple’s senior vice president of Worldwide Marketing, said, “iPhone 5c is everything iPhone 5 was and more, in an all-new design packed with great features. iPhone 5c is designed with a beautiful polycarbonate enclosure that looks and feels so solid in your hand.”

The Sliver Lining

But apparently that wasn’t enough to turn the heads of the masses in the market for low-cost smartphones. All Things D cited research from Consumer Intelligence Research Partners that reveals the iPhone 5s outsells the iPhone 5c two to one.

“According to CIRP’s survey of consumers who purchased Apple’s latest iPhones during the last days of September, the 5s accounted for 64 percent of total iPhone sales following its launch that month. Meanwhile, the 5c accounted for 27 percent, with the legacy iPhone 4S making up the remaining 9 percent. So not only is the 5s outselling the 5c, it’s outselling it more than two to one,” AllThingsD reported.

Of course, this isn’t altogether bad news for Apple. Some industry watchers warned that a lower-cost iPhone could backfire and eat into the sales of its higher end phones. CIRP reports that the 5c sold only slightly more than the 4s in the same measured period. The iPhone 4s, now a year-old model, made up 23 percent of sales.

Should We Be Surprised?

“The relative performance of all three iPhones is generally in line with the performance of the similarly priced phones following the launch of the iPhone 5 in 2012,” CIRP co-founder Josh Lowitz told AllThingsD.

“Over time, the lower-priced phones have tended to gain share versus the flagship phone, after the initial rush of dedicated upgraders to the newest device," Lowitz said. "So we expect that the 5c will account for a higher percent of total U.S. iPhone sales in the coming months, but the design changes may alter that dynamic. The iPhone 5c may appeal to different buyers than the legacy 4S did last year, or the new 5s will this year.”

We turned to Jeff Kagan, an independent wireless analyst, for reaction to the news that Apple is cutting production of the iPhone 5c. He told us it’s quite a shock.

“The Apple iPhone 5c has seen ‘dismal sales’ so they are cutting production by 50 percent. We just simply aren't used to hearing the words Apple, iPhone and low sales in the same sentence. Fortunately the iPhone 5s is still hitting it out of the park. Especially the gold version,” he said.

“There is much more to learn on this story, but initial take, this is like a punch in Apple’s gut. So this is why companies like Best Buy are giving these devices away. We knew there had to be a reason," he added.

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