Has The iPhone Peaked?

Prediction: Apple will sell every iPhone 5 it makes just on good execution and the strength of the brand. But the new phone already lags the competition in many areas, and it will be a year before the next major refresh. The iPhone 5 is a good incremental update, but Apple has left a big opening for Android and Windows Phone.

Larry Seltzer, Contributor

September 13, 2012

1 Min Read

Apple's iPhone has been an insanely popular device in the two and a half years since its release, but it may be showing signs that it has peaked. Even though the iPhone sold 18% more devices in Q4 2009 over Q3, the overall smartphone market increased 26% in the same time period.The Wall Street Journal, using research data from ABI Research, shows that Apple had 18.1% of the overall smartphone market in the third quarter but fell to 16.6% in the fourth quarter. That is still a respectable showing, especially given that for all intents and purposes, the iPhone is really just one device in a few different memory and speed configurations.

Still, it is just one device, which has evolved from the original iPhone sold in the summer of 2007. Despite the incremental changes to the platform, now at iPhone 3.x, and hardware tweaks, the phone is nearing three years old. How much more mileage can Apple get out of the current form factor?

I don't think the consumer's interest has gone away. If Verizon or any other carrier started selling the device, sales would explode again. There are a lot of people in the US that want the device but have no intention of moving to AT&T's network for it.

All other things being equal though, Apple needs to come out with alternative form factors, maybe something that folds, has a slide out keyboard, an different screen size, etc. I'm not sure the iPhone can remain as popular or desirable if iPhone 4.0 is merely more software updates this summer.