Tuesday, 6 December 2011

New Apple iPhone 4S availability, pricing creates fierce competition for Android

iPhone 4 4S
Apple has just announced their latest version of the iPhone–a reworked version of the iPhone 4 known as the iPhone 4S. Design wise, nothing has changed. Internally, Apple is finally catching up. And in pricing and availability? It looks like Android will finally face some stiff competition when it comes to who sells the iPhone and for how much.

For those of you who didn’t watch any live-blogs or disconnected from Twitter, here’s how the pricing and availability of the new iPhone breaks down. The iPhone 4S is the world phone (GSM + CDMA) and will be available on October 14t for AT&T, Verizon and finally Sprint.

Pricing for the iPhone 4S with a 2-year contract:

  • 16GB – $199
  • 32GB – $299
  • 64GB – $399
As far as the older iPhone 4 and 3GS go, there will be an 8GB iPhone 4 available for $99 on contract (will rely heavily on “the cloud,” should be available through AT&T, Verizon and Sprint), and the iPhone 3GS (AT&T only) will be free. Now before we go any further, I know what you’re thinking. This pricing by no means gives Apple the edge when it comes to selling phones on contract. What it does do, however, is put the company in a much more competitive position in several different arenas.

The iPhone has always been considered a premium product. Pricing models have reflected that. In fact they still do ($399 on contract?!), but now there is some sort of option for iPhone buyers across the board. Before, when someone walked into a store with $100 looking for a phone, they couldn’t get an iPhone 4. Now they can. And comparatively, the iPhone 4 can still hold its own. Of course there are far superior Android phones for the same price (or less) specs wise. It’s going to come down to which devices carriers try to push harder.

AT&T has stayed faithful to Apple and probably will continue to do so. Verizon has been very open with the devices they push. They have always placed a lot of emphasis on how awesome Android is, iPhone or not. Sprint, on the other hand, is an entirely new factor in the equation.

Recently, Google has placed a lot of faith in Sprint and vice versa. Sprint has allowed Google to try things out with the carrier, including Google Voice integration and Google Wallet. According to the Wall Street Journal, Sprint’s newly acquired iPhone deal wasn’t cheap. WSJ has sources saying that Sprint will pay somewhere in the neighborhood of $20 billion for 30.5 million iPhones over the next four years. In other words, Sprint has inked a deal for the iPhone that means they won’t be actually making money until 2014.

This Is My Next has pointed out that Sprint sees around 12 million upgrades per year and that they will need to sell 8 million iPhones to stay on track with the deal. Out of 12 million devices, Sprint needs 8 million of them to be iPhones. At this point, one can’t help but wonder, has Google just lost a partner in the mobile space? How could Sprint possibly sell the iPhone 4S at these kinds of numbers while still giving Android an equal amount of attention? It would seem they can’t.

Of course Sprint is just one carrier. The iPhone’s release on Verizon didn’t hurt Android in the way some analysts predicted. And there’s a good chance a Sprint iPhone won’t have a devastating impact either. Apple is merely putting more pressure on Google to stay focused. With the pricing of handsets, choice of carriers and huge variety of form factors, Google and Android will continue to do great if they continue down the path they’re on.

That includes focusing on a wide availability of devices (please don’t release the next Nexus only on Verizon!) and competitive pricing. Google is going to close 2011 out with a bang. And whether you like it or not, Apple has helped push them to do it. Fierce competition has pushed Google to constantly work on how they can make their products better for us, the consumers. Don’t expect that to stop anytime soon.


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