2014: Apple goes iPhone Mini, Samsung to grow

Monday, January 7, 2013

2014: Apple goes iPhone Mini, Samsung to grow

Samsung's global smartphone sales are set to climb 35 percent in 2013, according to Strategy Analytics, and Apple's response will be the long-rumored iPhone mini. Samsung is expected to hold 33 percent of the world's smartphone market this year, compared to Apple's 21 percent and a less expensive iPhone model could help Apple keep that gap from growing wider.

iPhone Mini
Strategy Analytics executive director Neil Mawston told Reuters, "We expect Samsung to slightly extend its lead over Apple this year because of its larger multitier product portfolios."

Apple's answer to Samsung's multitier product lineup, Mr. Mawston expects, will be to release a lower cost and smaller version of the iPhone. He said that if Apple ships an iPhone mini, the company could keep Samsung from gaining more smartphone marketshare.

That said, Mr. Mawston isn't expecting Apple to ship the fabled iPhone mini any time this year.

"The iPhone 5 is growing fast and profitably right now, so there is little incentive for Apple to launch an iPhone mini this year," he said. "We expect the iPhone Mini to be more likely next year, in 2014 when...Apple will be forced to discover fresh growth streams."

He also predicted Apple will ship its next iPhone model in May or June, and that the company will add more screen sizes to its lineup. The iPhone 5 offers a 4-inch display, while the iPhone 4 and 4S ship with a 3.5-inch display.

The older iPhones in Apple's lineup are available at substantially lower prices than the iPhone 5, as well. The iPhone 4S starts at US$99 with a new contract, while the iPhone 4 can be picked up for free on contract. Mr. Mawston sees the iPhone mini filling a different low-cost market: pre-paid subscribers.

"We think Apple will have to launch an iPhone mini at some point over the next three years to address the hundreds of millions of prepaid users worldwide that cannot afford the current iPhone," he said.

Smartphone competition between Apple and Samsung has been fierce and has even spilled over into the courtroom as the two companies accuse each other of using their mobile device patents without proper licensing. Apple has also distanced itself from Samsung by cutting back on the chips it buys from the company and moving its custom chip fabrication to other manufacturers.

For now Apple seems content with its iPhone model lineup and hasn't offered up any hints that a mini model is on the way despite Strategy Analytics' belief that it is coming.