iPhone 5s Demand Wanes in China

Cantor Fitzgerald analyst Brian White is touring China and reports to investors that demand for the iPhone 5s in the Asian country is disappointing, while interest in Chinese brands like Xiaomi is on the rise. This cool sentiment towards the iPhone may change when an iPhone 6 model with a larger screen arrives later this year.

iphone 5s
Interest in a large-screened iPhone model among Chinese vendors and carriers is reportedly very high, possibly making the next iPhone launch a “special” one for Apple.

In the near term, we sensed disappointment around demand for the iPhone 5S. That said, we heard great enthusiasm around the potential for Apple to introduce a larger iPhone form factor in China this year with the iPhone 6. In our view, the iPhone 6 with a larger screen (e.g., 4.7-inch, 5.5-inch) has the potential to meaningfully accelerate Apple’s growth trajectory in China during 2H:14. We have not heard this type of excitement in China around the iPhone in at least two years and thus we believe this could be a very special iPhone launch for Apple.

China has been a focus of Apple in recent years, with the company opening new retail stores and bringing both the iPhone and the iPad to wireless carriers in the Asian country. This year alone Apple has introduced a TD-LTE version of the iPad and launched both the iPhone 5s and 5c with China Mobile, the world’s largest mobile carrier with approximately 772 million subscribers.

Apple’s next iPhone model is expected to arrive in two display sizes, with one near 4.7 inches and the other at approximately 5.5 inches. The 4.7-inch model may debut this fall, while the 5.5-inch is rumored to land sometime in 2015.

4.7-Inch and 5.7-Inch iPhone 6c Models Surface

Long-running Japanese magazine MacFan has published alleged drawings of what appear to be 4.7-inch and 5.7-inch iPhone 6c models in its latest issue, reports Mac Otakara . The images appear to show a flat, bezel-free device with rectangle-shaped volume controls like those found on the current iPhone 5c, as well as a camera with a single LED-flash on the rear.

iphone 6

While the validity of the drawings are unknown, iPhone 6 rumors have suggested that Apple will continue with the dual iPhone strategy, producing the iPhone 6 in two different sizes. The most recent report from Japanese newspaper Nikkei said that the iPhone 6 could launch “as early as September” in 4.7-inch and 5.5-inch sizes. Other reports have suggested that Apple will cease the production of a plastic iPhone in favor of using metal casings for both phones.

Ultimately, it is unlikely that a lower-end 5.7-inch iPhone 6c would be released alongside a higher-end 5.5-inch iPhone 6. However, having two iPhone lines and two sizes would allow for Apple to continue with its current pricing strategy, offering a full-priced flagship device, a mid-tier lower-cost device, and an older device at an even lower cost. Mac Otakara also published a report [Google Translate] last month on the possibility of an expanded iPhone 5c line-up with 4.7-inch and 5.7-inch models.

Apple is expected to unveil the next-generation iPhone sometime in Fall, which is likely to incorporate a durable sapphire display along with expected processor and camera upgrades.

Update 6:28 AM: Here is a slightly higher resolution version of the drawings, showing the smaller model to measure what appears to be 137×66 mm and 7.0 mm thick. The larger model appears to be 157×77 mm and just 6.7 mm thick, with that thinner body requiring that that the rear camera protrude somewhat as on the current iPod touch.

iphone 6

iPhone 6 Will Launching ‘As Early As September’?

Apple’s iPhone 6 is expected to launch “as early as September”, according to a new report from Japanese business newspaper Nikkei. The paper claims that the device is “expected” to be called the iPhone 6 and is “likely” to be offered in 4.7-inch and 5.5-inch display sizes, in line with circulating rumors.

Manufacturers have apparently begun making such components as fingerprint sensors and chips for liquid-crystal drivers.

Mass production of LCD panels will start as early as the April-June quarter at Sharp’s Kameyama factory, Japan Display’s Mobara plant, and at other facilities, according to sources. LG Electronics will supply panels as well. The new handset’s display resolution is expected to be significantly higher than that of current models.

iphone 6 size
Earlier this week, UBS analyst Steve Milunovich claimed that the 4.7-inch version might be the only model to launch later this year, with a timeframe for the larger 5.5-inch version unclear.

iPhone 6 concept look like iPod nano

While the iPhone 5s and the iPhone 5c saw many part leaks ahead of their September 2013 release, we have seen no solid hints on what Apple’s larger iPhone 6 might look like, leaving it up to designers to imagine how Apple will redesign its flagship product.

Concept artist Martin Hajek has teamed up with iCulture to create a mockup of the iPhone 6 based on some recent rumors, which suggested the iPhone 6 might take some design cues from the iPhone 5c and the seventh-generation iPod nano. While the report indicated the phone could adopt the colored anodized aluminum backing of the nano, Hajek has taken the nano-inspiration even further, with a flat, rectangular design and a 4.7-inch screen.

iphone 6
Apple’s iPhone 6 is expected to be larger than the existing 4-inch iPhone 5s, with a screen size ranging from 4.7 inches to 5.7 inches. Some rumors have indicated the company has plans to release two separate phones in that size range, but it remains unclear if the company will proceed with that plan.

iphone 6

Along with a larger screen size, the iPhone 6 may incorporate a durable sapphire crystal display and will undoubtedly feature processor and camera upgrades. Apple is expected to introduce the iPhone 6 in the fall alongside iOS 8.

iPhone 6 Dummy Prototypes show up

Photos of a new “dummy unit” of Apple’s alleged iPhone 6 have surfaced on the site of case manufacturer Bling My Thing (via 9to5Mac community post). The photos show a black device that could be used as part of a mold to create cases based on that body design.

iphone 6 case
There are several issues with the case shown in the photos, however, including a round hole for the LED flash on the rear camera instead of the oval hole introduced on the iPhone 5s to accommodate the new True Tone dual-LED flash. Given the improved flash performance possible with dual LEDs, Apple will presumably continue to use dual-LED flash in future iPhones.

iphone 6 case
The photos also appear to show a slight change to the design of the earpiece area of the iPhone, with the proximity sensor window moving from next to the earpiece to next to the front camera. The ambient light sensor (not easily visible) is currently in this location. The dummy unit also shows the earpiece/camera/sensor features moved higher on the device’s front, to the point where the front camera unreasonably appears to sit at the very top edge of the device.

Some of the rumored specs:

  • Two sizes – 4.7 inches and 5.5 inches
  • Screens made entirely out of sapphire crystal
  • Pixel density of 441 pixels per inch, from the current 326 ppi display
  • There will be optical image stabilisation for the 8 megapixel camera
  • f/1.8 aperture lens – an improvement over the iPhone 5s’ current f/2.2 lens
  • New 802.11ac Wi-Fi standard
  • Pressure, temperature and humidity sensors
  • Possibly a solar power charger built into the screen

Larger iPhone 6 May Cause Massive Spike in Upgrades

Apple’s upcoming iPhone 6 is widely rumored to include a larger display, which could encourage a significant number of users to upgrade in 2014, according to analyst Brian Marshall of ISI Group, who released a note to investors today.

Echoing past iPhone 6 rumors, Marshall suggests Apple will release two versions of the phone, one with a 4.7-inch screen and one with a 5.5-inch screen. The launch of two phones, both of which offer a total redesign of the existing 4-inch iPhone 5s, could spark a massive upgrade cycle.

iphone6-sizes
Apple’s current installed base is estimated to be at 260 million users, and ISI Group calculates that half of today’s iPhone purchases are made by upgraders, users who are upgrading their iPhones from an existing iPhone to a new version of the product.

ISI indicates that while the upgrade rate (percentage of installed base upgrading devices in a given quarter) was at 10 to 11 percent in 2011–2012, it has now dropped to approximately 9 percent because users have fewer reasons to upgrade with the iPhone 5c and 5s not introducing any significant design changes.

iphone 6
Peak quarters have seen upgrade rates of 12 to 14 percent, and ISI expects a similar upgrade rate during the second half of 2014 when the iPhone 6 is launched, resulting in a higher number of sales. An iPhone 6 with an increased screen size may also lure customers who have switched to Android from the iPhone because of the latter’s lack of a large display.

“Large-screen envy” is prevalent among the iPhone installed base and we believe a ~5” form-factor iPhone would spark a massive upgrade cycle as well as many “Android switchers” returning back to the iPhone (we refer to this as the “mother lode” of all Apple upgrade cycles).

Citing both “large-screen envy” and “pent-up demand” ISI Group suggests the new iPhone 6 models could result in an extra $3.00 earnings per share following release in the second half of 2014.

Higher demand for an iPhone during a redesign year is not unreasonable, as it has now been two years since the 2012 introduction of the iPhone 5. While the iPhone 5s included multiple internal improvements and the Touch ID fingerprint sensor, it retained the same 4-inch display and design of the iPhone 5, as did the iPhone 5c, which was just a repackaging of the existing model.

iPhone Air Shown Off In New Concept Video

The upcoming iPhone 6 has been incorporated into a new concept video by designer Sam Beckett, which was initially posted to The Verge forums. According to the dimensions Beckett provides, his “iPhone Air” concept includes a 4.7-inch display, a 1920 by 1080 resolution and 468 pixels per inch.

Beckett’s concept is 8 percent larger than the iPhone 5s and 9 percent thinner. The slimmer profile is in line with previous iPhone 6 rumors, which have suggested Apple has improved itsbacklighting technology to allow for thinner devices.

The phone is only 8% larger than the existing iPhone 5S, this increase is to accommodate the larger screen. Some extra space could be potentially utilised by reducing the width of the side bezels and by also slimming down the top and bottom of the phone frame too. The depth of the iPhone Air is 7mm, coming in 0.6mm smaller than it’s predecessor. This modest reduction in the device depth and larger increase in the width and height could help create a bigger space for the battery and other components.

Like several other iPhone 6 concepts, Beckett’s design keeps the same general size and shape of the existing iPhone 5s while doing away with thick side bezels. The design incorporates thinner side bezels with a sapphire crystal display, both features the phone is rumored to include.

Beckett also draws on a number of other rumors for the video, suggesting the iPhone 6 will include a 10-megapixel sensor with an aperture of f/1.8 and a faster A8 chip, which is reportedly already in production with TSMC.

As with any concept, it is unclear if these ideas and rumors will make it into the next-generation iPhone, but the video does imagine how a larger iPhone could possibly look. Apple is said to be developing two larger iPhones for release in 2014, one near 4.7 inches and one quite a bit larger at approximately 5.5 inches.

Best Buy Offering Free 16GB iPhone 5s With Trade-In of iPhone 4s or 5

Best Buy is introducing another special deal this weekend, offering a minimum of $150 for trade-ins of working iPhone 4s and iPhone 5 smartphones. Customers must buy a new smartphone with two-year contract on AT&T, Sprint or Verizon, however. The offer is good through the end of the day tomorrow, March 1. The chain has also reduced the price of the base 16GB iPhone 5s to $150 to match the buyback.

iphone 5s
With a number of carriers moving away from two-year contracts for its customers — instead focusing on non-subsidized, but cheaper, monthly plans — it may be affecting the bottom line of retailers like Best Buy because plans like AT&T Next do not, in many cases, require customers to pay money up front.

For upgrade-eligible iPhone-owners looking to move to the iPhone 5s, this promotion could be an inexpensive way to do that.

Apple Will Release 5.6-Inch ‘Experimental’ Phone Without iPhone Branding

Apple is planning on introducing two new phones this year featuring displays of 4.7 and 5.6 inches, with the former using a traditional Gorilla Glass display and the latter featuring a sapphire screen, according to a new report from Taiwan’s Economic Daily News [Google Translate] (via Mac Otakara). The report also states that due to its experimental nature, Apple’s 5.6-inch phone will not be known as an iPhone.

iphone 6

While it is somewhat probable that Apple could release two versions of the iPhone as previouslysuggested by other reports, it is very unlikely that the company would drop the iPhone name for the larger phone given the iconic reputation of the brand.

The report adds that Apple’s next-generation phones will once again be assembled at primary supplier Foxconn (also known as Hon Hai Precision Industry Co.), with other suppliers including Cheng Uei Precision Industry and Simplo Technology also helping with production. Furthermore, the sapphire displays to be used in the 5.6-inch phone are said to come from new Apple partner GT Advanced, which was reported to be gearing up for massive production of devices with sapphire displays earlier this month.

Apple has been experimenting with a range of screen sizes for the next-generation iPhone since early 2013, with size rumors varying from 4.7 to 5.7 inches. Last week, the South China Morning Post stated that the company would be launching two new iPhones with larger flat sapphire displays in September, while The Korea Herald reported that the iPhone 6 would adopt a “bezel-free” display.

In addition to a new display, other reports have indicated that the iPhone 6 will feature a slimmer profile due to thinner and lighter backlights and a 10-megapixel or higher camerawith an improved filter. The iPhone 6 is generally expected to arrive in the same September-October timeframe seen in recent years.