Apple iPhone 5: Opportunities And Threats
iPhone 5 delights on a device level, but has plenty of rivals to worry about. Take a look at our competitive assessment.
The Apple iPhone 5 is easily the Cupertino company's best effort at making a cell phone. It packs more features into a thinner and lighter device that will surely delight the many millions of people around the world who choose to buy it. Making that choice will be difficult, though, as the smartphone market is a fierce place in which to do business.
The iPhone 5 has plenty of competitors to worry about, not only with respect to hardware, but software, too. Here's a competitive assessment of the iPhone 5 amidst a crowded field of combatants. Let's use the good old SWOT (strengths, weaknesses, opportunities, threats) method.
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Strengths -- The iPhone 5 may not look all that different from previous generations, but it still has an iconic look and (what appears to be) top-notch construction. The glass and metallic materials used give it a high-class, sophisticated look that puts many of today's smartphone designs to shame.
The iPhone 5 has incredible carrier support, and is launching around the world quickly. It is fairly cheap, $199, $299, and $399, depending on storage capacity.
Apple's brand is at the height of its powers. Also, Apple's ecosystem is better than that of its competitors. The iTunes Store, App Store, and seamless integration between phone, tablet, and computer make a compelling story for Apple to use. The iPhone 5 may not have the cache of the original iPhone or iPhone 3G, but it still brings its own star power to market.
Weaknesses -- Apple releases one phone per year, while its competitors release hundreds. Apple takes the one-size-fits-all approach, where the competition prefers wide-ranging choice (varying screen sizes, keyboards, etc.). The iPhone 5's screen may still be too small for some. The iPhone 5 is locked down. Apple's competitors are generally open. Android's home screens, for example, offer far more customization thanks to resizable widgets and moveable app shortcuts.
Apple is also a bit weak when it comes to technology. There are no cutting edge features in the iPhone 5. It is evolutionary, not revolutionary. That's not to say that evolution isn't important. After all, it's what got humanity out of caves and into McMansions. But some competitors are jumping ahead with new technology.
For example, the iPhone 5 doesn't have near-field communications. Without NFC, the iPhone won't be a good mobile payment device. The iPhone also doesn't have inductive charging. Both of these features are offered by the recently-released Nokia Lumia 920. NFC is available on many Android devices, as well.
Opportunities -- Apple is a winner in the enterprise. It has beaten BlackBerry out of the boardroom, and has so far held Android at bay. The iPhone 5 has a real chance to score massive enterprise support, especially with companies that have already chosen the iPhone. This could help give it a lead over Android and keep Windows Phone and BlackBerry 10 from regaining their lost enterprise market share.
Same goes for the government. If Apple can win over even more governments, it can grow its user base with sales of the iPhone 5.
Apple's biggest opportunity comes from its own, loyal fan base. Considering how incremental the update between the iPhone 4 and iPhone 4S was, many iPhone fans decided to skip the iPhone 4S. Those iPhone 4 owners are surely pining for new hardware, and the iPhone 5 is a tempting target. Apple's ecosystem also plays a role here. Those who've already invested money in Apple's ecosystem are more likely to remain with it. Beyond that, the truly fanatical fans--which number in the millions--will buy the iPhone 5 no matter its faults. These annual upgraders are all too happy to give Apple their money.
The challenge will be winning back previous iPhone owners who've moved on to Android devices.
Threats -- In a word, Samsung. Samsung is gunning for Apple, and it's obvious. The Galaxy S III has already replaced the iPhone 4S as the best-selling phone in the U.S. Samsung believes it will sell 30 million of them before the end of the year. The Galaxy Note II is due to arrive before the holidays, with a massive, 5.5-inch display that puts the iPhone 5's 4-incher to shame. Further, the number of features and capabilities Samsung has been putting into its devices is astounding. The Galaxy Note 2, in particular, has more camera options than some digital SLRs I've used. Sure, the end results matter more than the tools used to achieve them, but no one can scoff at Samsung's results nor its tools.
With its current specs and feature set, the iPhone 5 compares badly to devices such as these.
Apple doesn't have to worry much about HTC, LG, Sony, Pantech, nor other Android licensees at the moment. It has already eaten their collective lunches, and won't be giving the milk money back.
Apple has to worry about ideology, though. Its flood of lawsuits against Android device makers has earned it negative sentiment among some circles. Its courtroom victories may pull some cash from the competition, but Apple might lose big in the court of public opinion. People angry at Apple for its legal maneuvering aren't as likely to buy its products.
In the end, the iPhone 5 will be a hit. There's no doubt of that. It's better than previous iPhones in every way.
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