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The great 'iPhone 5C is a failure' freakout

John Cox | March 19, 2014
The iPhone 5C is six months old in March. It's been declared a disaster, a dud, a fiasco and a flop. The reports of its death have been greatly exaggerated. Here's why.

The fact that 5c buyers are different from Maxcer is suggested in additional data from Kantar, part of a Feb. 24, 2014 report on smartphones in Europe, "Android edges toward 70% in Europe." The company noted two demographic trends in iPhone buyers. "There is a stark gender divide between 5c and 5s buyers in Britain 74% of 5c buyers are female versus just 36% for the 5s. There are also clear differences in how each device is used. 5s users are more engaged with their device, particularly for data-heavy functions such as watching mobile TV or downloading music."

A single study is not conclusive. But it's at least suggestive, and bearing further study, that a very different group of buyers is choosing the 5c compared to the 5s.

How is the iPhone 5c actually selling?
Apart from Cook's comments in the conference call, there is no definitive data. But there are some surveys and studies, which have varying degrees of rigor, that suggest that it's selling at least as well as the 4S did in its role as the less expensive iPhone.

In December 2013, Kantar reported that the 5s was outselling the 5c by a 3:1 ratio in Britain. But by late February 2014, the ratio had improved to 2:1, according to the report cited above. To restate that: at its "worst," one of every four new iPhones sold in Britain 25 percent was an iPhone 5c. By the end of the study period, that had risen to one in three — 33 percent.

But the ratio can change because both variables change sales of the 5s might have fallen, or 5c sales rose, or both. This dataset by itself doesn't reveal that inner dynamic.

In January 2014, Consumer Intelligence Research Partners  published its estimates of how the 5c sold in that quarter compared to the 4S in the year-ago quarter after the release of the iPhone 5. This seems to be one of the very few attempts so far made to compare Apple's apples with...apples.

The CIRP study was based on a survey of just 500 U.S. Apple customers that purchased an iPhone, iPad, or Mac in the U.S. from October to December 2013, according to a summary that appeared on WallStreetCheatSheet

First, let's look at CIRP's data on the performance of iPhone 4S, after the launch of iPhone 5 in September 2012. "Following the October-December 2012 quarter, the iPhone 5 accounted for 50 percent of total sales while the then-mid-priced iPhone 4S accounted to 32 percent of sales," CheatSheet summarized. "Rounding it out, the iPhone 4 took 18 percent of sales in the year-ago quarter." That means the lower-priced iPhones in late 2012 the 4S and 4 accounted for 50 percent of all iPhones sold during that quarter.


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