Whether it’s Mac, iPod, iPhone, or iPad, it’s trivial to find competitive products priced lower than Apple’s wares. The only time Apple has maintained a commanding marketshare with a product was the iPod. We’re about to see the iPodification of Apple’s iPhone line.
Open The Price Umbrella
What Apple did with the iPod line was unique to the company. Among the many and typical portable media players, it was Apple which commanded the lucrative high end and marketshare at the same time.
How was that possible? Apple did not allow much of a pricing umbrella to cover competitors products. iTunes was available for Mac or PC, as was the iTunes Music Store.
More importantly, Apple created a full line of iPod models from clip on, to pocket, to iPod touch (essentially a mini iPad mini).
That line was and remains priced from $49 for the shuffle to the iPod touch as high as $399. Between the two is the iPod nano starting at $149, and the iPod classic at $249.
In other words, Apple covered the pricing spectrum with products that were and are affordable and competitive on price, hence the company maintains the lion’s share of the market, though the iPod is slowly diminishing as a viable line of products.
Unfortunately, Apple didn’t provide a similar product line for the iPhone, where a new model starts at about $650 without a plan. That pricing-without-a-migration path opened the doors for cheap Android smartphones to take over the industry by storm.
Apple really did nothing to replicate the company’s iPod success, or to broaden the line to compete with lower priced products. True, most Android OS smartphones are little more than the 21st century version of a feature phone, but the math doesn’t appear to be in Apple’s favor over time.
Unless Apple iPodifies the iPhone line.
The word on the streets is that Apple will launch a much less expensive plastic iPhone soon, and the newly remodeled iPhone 5S will become the high end product, possibly reduced to mid-range by the introduction of a large screen five-inch iPhone early next year.
Is the iPodification of the iPhone line too little too late?
Possibly. It certainly seems that BlackBerry, Nokia, and Microsoft Windows Phone are too little and too late to make profitable inroads against the Android and iPhone duopoly.
The real issue is not who is vying for third place, but can Apple maintain enough marketshare against Android to remain viable long term. Frankly, despite Apple owning a large but shrinking chunk of the industry’s profits, the jury remains out.
Apple should have iPodified the iPhone line years ago.