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Analyst: Number of first time Apple iPhone buyers is rapidly shrinking

Posted: , by Alan F.

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Analyst: Number of first time Apple iPhone buyers is rapidly shrinking
 Sanford Bernstein analyst Toni Sacconaghi is telling clients that his research shows that the number of first time Apple iPhone buyers is shrinking. Last year, 62% of iPhone sales came from first-time buyers, a number that is expected to drop to 54% this year. That is a drop of 13% in net new iPhone buyers. The analyst's concern is that without a deal with China Mobile or the introduction of a really low priced model for developing countries, there are not enough first time Apple iPhone buyers left for sales to meet consensus forecasts for 2014 and 2015 sales of the device.

The problem with this analysis is that it does appear as though a version of Apple's iconic smartphone will be available to the 750 million subscribers of the world's largest carrier. The other day, we showed you a picture of the Apple iPhone 5s being tested on China Mobile's TD-LTE pipeline. While the smartphone itself has been approved by the country's equivalent of the FCC, China Mobile is waiting for approval from China's regulators to turn on its 4G LTE network.

But since Sacconaghi apparently spent so much time on this analysis, let's assume that the China Mobile deal doesn't go through. The analyst sharpened up his pencils and computed that first time buyers of the Apple iPhone will drop to 37% of total buyers in 2014, and 28% in 2015. That  means that by 2015, nearly 70% of those buying an iPhone will be replacing an older model.

So what is the big deal about the saturation of this market? For one, replacement buyers won't be repurchasing all of the content and apps they have already purchased, which means less revenue for developers. It also would put pressure on Apple to make each year's upgrade of the iPhone just different enough to get current owners of the device to want to buy the new model. Actually, that sounds just like what Apple is doing now!

Analyst sees further drops in first time Apple iPhone buyers

Analyst sees further drops in first time Apple iPhone buyers


source: Fortune via ZDNet

70 Comments
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posted on 13 Oct 2013, 14:19 5

1. Mxyzptlk (Posts: 14208; Member since: 21 Apr 2012)


I think the study is inaccurate.

posted on 13 Oct 2013, 14:22 36

2. XperiaFanZone (Posts: 2146; Member since: 21 Sep 2012)


Get over it.

posted on 13 Oct 2013, 15:20 3

11. stealthd (unregistered)


Nice worthless comment you made there. Would read again!

posted on 13 Oct 2013, 19:54 8

44. appleDOESNT.com (banned) (Posts: 456; Member since: 19 Nov 2011)


700 million iOS devices recently reported. Average iClone owns 4 iPads, 3 iPhones, 4 iPods, 1 AppleTV puts their total user base a less than 60 million unique owners or there abouts. That number is maxed out as even the most ardent iFollowers can see that apple's shtick is tiresome, ya know charge more for less and S hit after S hit and nothing new for well umm, since iPhone and that was 2007 (iPad was nothing new, it's a big iPod touch, get over it, you don't even use it anymore barely lol)

posted on 13 Oct 2013, 14:31 31

5. AnTuTu (Posts: 1580; Member since: 14 Oct 2012)


And they would be shrinking month after month now.

Because people do realize that companies like Samsung, LG, Sony, HTC, Nokia, Moto and Oppo are far better and capable enough to produce great quality products.

posted on 13 Oct 2013, 15:21 5

12. stealthd (unregistered)


This comment has been said for years now. It isn't any more true than it was years ago. If these predictions came true then Apple should have disappeared by now.

posted on 13 Oct 2013, 16:18 8

20. TomTheNerd (Posts: 67; Member since: 11 Oct 2013)


these aren't predictions. many people do realise that other companies are jumping ahead of apple's game, and apple are slowly falling behind. but many other people still buy their products, whether they aren't spec-hungry, don't know anything about tech, are hipsters, or are just that kind of apple fanboy that runs off the toilet to go buy the new iphone. but from a reasonable point of view, people like myself do actually know about tech and know that while the iphone may not be the best phone, it works for what it is and judging by sales, people seem to be fine with that at the moment. apple don't see the need to get 2500mah batteries, bigger screens, 2ghz CPUs, 1080p displays and 3 gigs of ram, because they have been doing the same stuff for years and sales of their phones have been rocketing. why fix something that's not broken?

posted on 13 Oct 2013, 17:13

26. stealthd (unregistered)


Bigger numbers don't make better phones. Samsung, LG etc can't control everything on their phones since they use Android, so they tack on features no one cares about like air gestures. They have all that RAM and higher clockspeeds and they still aren't as smooth as an iPhone. So they have to get better specs, it's a marketing gimmick, bigger numbers look better, even though they don't necessarily translate into better performance. People who know about tech know specs don't matter. People who like to pretend they know about tech think specs are a big deal, because they don't look past what's on paper at how a phone actually performs.

posted on 13 Oct 2013, 17:37 7

29. Whateverman (Posts: 3271; Member since: 17 May 2009)


Though I agree with you as far as specs not being the only thing that matters, one thing you didn't mention is functionality. As great and as smooth as the iPhone is, it's probably dead last when it comes to functionality. The features Apple has added are great, but features like NFC should have been a no brainier. Apple, with all of its influence is actually holding innovation back. People in other countries have been making payments with their phones for years now. But because APPLE thinks its silly to bump phones to share a picture, NFC in the US is on the verge of death. KeyChain has been on Android for YEARS, but the service industry made very little use of it. Then Passbook came out, as bad as it sucked, every retailer scrabbled to make their systems compatible. Imagine if Apple gave the nod to NFC? I think the same thing would happen, but all they worry about is making it "thinner, lighter and easy to operate with one hand". Android isn't perfect, no OS is, but the extra 5 nanoseconds of scrolling time isn't something most of us Android users notice or even care about.

posted on 13 Oct 2013, 18:02

36. HansGoneInsane (unregistered)


Actually I am happy that other solutions for payments on smartphones are discussed (independently from Passbook). NFC really lacks security. It is so easy to hack a phone via NFC and if everyone pays via NFC, it really is an invitation to criminals stealing your money. I think it is worth to either wait until NFC has been improved or someone comes up with a better idea than NFC.

posted on 13 Oct 2013, 21:49 1

53. Whateverman (Posts: 3271; Member since: 17 May 2009)


That maybe true, but at one time WiFi was very easy to hack, but then we learned how to take better security measures. The same could be the case for NFC but how can it ever mature and develop those security gains unless all mobile platforms use it? Apple should include it in their next iPhone and help it along.

posted on 13 Oct 2013, 18:42 3

42. PapaSmurf (Posts: 10457; Member since: 14 May 2012)


Note 3 is faster than the iPhone 5S. Just wanted to get you out of 2010 and update you to 2013.

posted on 13 Oct 2013, 14:40 10

6. GadgetsMcGoo (Posts: 168; Member since: 15 Mar 2013)


The "I think" just makes the rest of the sentence completely worthless.

posted on 13 Oct 2013, 16:17 2

19. javac (Posts: 102; Member since: 04 Mar 2013)


My only question for you is how is anything bad for apple inaccurate but anything good no matter how pointless ( like say a fingerprint scanner) is amazing and innovative? Fingerprint scanners where put on phones long before apple did it. Besides I work at verizon and we are still sitting on the new iphones we bought when it came out. The numbers that you think are "records" are nothing more then what the carriers bought. You are the most biased person on this website.

posted on 13 Oct 2013, 17:29

27. ardent1 (Posts: 2000; Member since: 16 Apr 2011)


Another example of Mxy sharing his opinion --- which happens to be extremely vague -- and the android camp enters their knee-jerk bashing mode.

It's a very vague comment or general comment. It's like someone saying I like ice cream.

Me thinks the android camp doth protests too much.

posted on 13 Oct 2013, 17:43 8

32. Whateverman (Posts: 3271; Member since: 17 May 2009)


You made a bigger deal of the replies, then the replies made of the original comment. None of them even made mention of Android. Looks like you're the one protesting to much.

posted on 14 Oct 2013, 00:13

58. ardent1 (Posts: 2000; Member since: 16 Apr 2011)


Whateverman:

Okay, reading comprehension is not your forte.

The phrase employed was "android camp" -- e.g. people like you. Just count the number of people in the android camp that made knee jerk responses (inclusive of post #32).

posted on 14 Oct 2013, 01:01 3

63. joey_sfb (Posts: 6015; Member since: 29 Mar 2012)


I scan thru only you started attacking Android like you usually do on unrelated article.

posted on 14 Oct 2013, 05:15 3

67. Whateverman (Posts: 3271; Member since: 17 May 2009)


Your rantings are so sad, it funny. There was no knee jerk reactions until you jumped in with your baseless comment. All the guy said was to "get over it", what's so bad about that? Oh, that's right... the fact that it was said to a known iOS fanboy(such as yourself) that's what really got you all hot and bothered. You made this into another Android vs iOS battle, not the people who responded.

As stated earlier, I am an Apple fan from way back so I hold Apple to a much higher standard than you do apparently. I'm not so easily impressed by the iphone and if that ruffles your feathers, to bad.

posted on 13 Oct 2013, 20:44 3

46. InspectorGadget80 (unregistered)


I think people are getting sick n tired of the same phone one model once a year

posted on 14 Oct 2013, 03:13 1

65. rusticguy (Posts: 2828; Member since: 11 Aug 2012)


Yup because it doesn't paint the picture of best getting better ... so it hurts :)

posted on 14 Oct 2013, 05:08 1

66. PhoneArenaUser (Posts: 5498; Member since: 05 Aug 2011)


Silly trend is slowly going to an end. :)

posted on 13 Oct 2013, 14:24 4

3. papss (unregistered)


It's pretty hard to be accurate With this type of thing but it's not hard to see that their total percentage is dropping.

posted on 13 Oct 2013, 15:49 1

15. Tommy1960i (Posts: 119; Member since: 11 Oct 2013)


They need bigger screens and more freedom on iOS for a great succes.

posted on 13 Oct 2013, 17:53 1

33. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)


Apple could also lose the iOS7 color scheme.

posted on 13 Oct 2013, 18:40 1

41. PapaSmurf (Posts: 10457; Member since: 14 May 2012)


I like iOS 7, but some of the icons... Yeah, they need to go.

posted on 13 Oct 2013, 20:40

45. Finalflash (Posts: 3216; Member since: 23 Jul 2013)


No they don't actually, because to compete with Android on something that Android has been doing since the beginning, would be stupid. They are trying to differentiate themselves with their walled garden approach and that is a niche itself. Some people just want it to do what they have been doing for years because they are comfortable with it. They do not like too much change all at once. That and security could be Apple's target market and they would do very well. Unfortunately, I do not see what they were going for with the kindergarten color pallet and over animated iOS 7. They should have gone with a more professional minimalist look instead of a the current direction and marketed the platform to the enterprise and stability market.

posted on 13 Oct 2013, 21:27

51. Googler (Posts: 813; Member since: 10 Jun 2013)


There's less money in the enterprise sector. The real money is mainstream consumers who have expendable cash. Explains why Apple is successful in countries like the US.

posted on 13 Oct 2013, 14:30

4. Navaid (Posts: 46; Member since: 05 Sep 2013)


You don't say..

posted on 13 Oct 2013, 14:54 10

7. twens (Posts: 981; Member since: 25 Feb 2012)


You see how the writer is quick to defend Apple? This site is bullcrap.

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