Apple iPhone install base is still heavy on the iPhone 4/4S, giving prospects for massive upgrades ahead

Apple iPhone install base is still heavy on the iPhone 4/4S, giving prospects for massive upgrades ahead
Despite the data from Apple indicating solid iPhone sales, but a plateaued market share, arguably lackluster iPad sales compared to previous quarters’ activity, and the prospect of something wearable in the works from Cupertino, it is the iPhone we need to keep watching.

Some analysts have low expectations about how the iPhone 6 (or whatever it ends up being called) will sell following its anticipated announcement later this year. However, there is another metric we should consider, the iPhone 4 and iPhone 4S.

When people think of Apple, they think of the iPhone, plain and simple. Analysts at Morgan Stanley made a chart compiling the ownership of iPhone users by device generation. We will first note that the survey and research shows some errors. The iPhone 3GS or older is not compatible with the incumbent networks of Verizon or Sprint, so we will chalk that up to common margins of error when it comes to surveying.

What is most interesting is that the bulk of iPhone owners are still using the iPhone 4 or 4S. They were either locked into contracts or were simply not endeared to upgrade to the iPhone 5 generation of devices. The thinking of some of these folks on Wall Street is that Apple is going to have a bumper harvest when the iPhone 6 drops and those folks on what will be three-generation-old equipment will finally upgrade.

Given the percentages with the United States’ two largest carriers, that accounts for many tens-of-millions of units that may be upgraded. Apple has been playing the iPhone evolution conservatively. If this data user data is accurate, then these are potential sales that are arguably Apple’s to lose.


source: Business Insider

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51 Comments

1. ihavenoname

Posts: 1693; Member since: Aug 18, 2013

I've noticed the same thing. When I sit at the bus, or train, or restaurant, or walk at the street, almost everybody or at least couple have 4/4S. (I live in Helsinki, Finland). Well, on the other hand GS3 and 920 seem to be very popular also after 520.

18. ArtSim98

Posts: 3535; Member since: Dec 21, 2012

You're also Finnish? Wow didn't know.

35. icyrock1

Posts: 307; Member since: Mar 25, 2013

Yep. Same thing here in the US. While us more Tech savvy users like having the latest and greatest, -we are the minority-. Lots of people are just fine keeping the same phone for two or three years.

2. likemorethan1

Posts: 48; Member since: Aug 22, 2013

In the end, they're like Steve's legacy though

3. networkdood

Posts: 6330; Member since: Mar 31, 2010

My wife had the Verizon i4, but, after awhile there were some apps that were not working - now she has an AT&T i5C and is happy, again...oh well, no one is perfect.

30. __0__

Posts: 242; Member since: Jan 07, 2014

5C is a good device

4. baldilocks

Posts: 1542; Member since: Dec 14, 2008

That chart isn't even correct. The iPhone wasn't even available on Verizon, let alone Sprint, until the iPhone 4.....

7. Maxwell.R

Posts: 218; Member since: Sep 20, 2012

Hence the part where we wrote: "We will first note that the survey and research shows some errors. The iPhone 3GS or older is not compatible with the incumbent networks of Verizon or Sprint, so we will chalk that up to common margins of error when it comes to surveying." Also, AT&T and Verizon did trade some properties which meant that some customer base might have had AT&T sourced iPhones from a previous generation. Still, it is more likely a survey error, "Which iPhone do you have?" "I don't know, I get 3G with it." - etc...

12. a_merryman

Posts: 749; Member since: Dec 14, 2011

That they could make such blaring mistakes such as saying there were iPhones before the 4 on VZW and before the 4S on Sprint kind of calls into question the integrity of the survey and analysis. Heck, if this is the kind of rigorous research needed to work at Morgan Stanley I should see if my 8 year old cousin could get a job (I kid). But really, it does seem that it isn't unfair to call into question the actual stats they give us for the rest if that is the type of stringent quality control they put in place. Not that I would imagine the analysis or data would change very much, I myself am still on a 4S as well as 2 other family members. So I personally am waiting to upgrade, even if that is just anecdotal evidence to support their claims.

13. Finalflash

Posts: 4063; Member since: Jul 23, 2013

I dont see how they couldn't just be unlocked devices on different networks. People with jailbreak and unlocked phones could easily use those networks (gsm).

16. a_merryman

Posts: 749; Member since: Dec 14, 2011

VZW and Sprint use CDMA (and LTE now), the first iPhone to have CDMA included was the iPhone 4, and that still didn't work with Sprint. Sprint didn't get an iPhone until the 4S. Even if the person had an unlocked iPhone 3GS on AT&T, they still wouldn't be able to take it to VZW or Sprint as it doesn't have the necessary network technology in it.

50. chebner

Posts: 249; Member since: Oct 17, 2011

You are correct that Sprint didn't get the iPhone until the 4s was released but Sprint did get the 4 at the same time or a short time later. My daughter has an iPhone 4 on Sprint; she's had it about 18 months. It was painfully slow when she got it but she insisted on an iPhone and I wasnt going to shell out $200 on a 4s for a 5th grader. Trying to convince her to go Android when she upgrades. She likes the look of my ONE M8.

36. tedkord

Posts: 17452; Member since: Jun 17, 2009

They always sold previous generations, so once the 4 released did they release the 3gs with Verizon bands? I'm asking, I honestly don't know.

44. a_merryman

Posts: 749; Member since: Dec 14, 2011

No, they just continued selling those phones as is. VZW only had the 4 to start out with

45. Jommick

Posts: 221; Member since: Sep 10, 2013

It could also be there's a good enough portion of people who literally took a CDMA antenna and replaced the GSM antenna in their 3GS - far less common than 3% though

5. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

As the iPhone 4 and 4S are often free on contract, I wonder how much of the iPhone 4/4S installed base is just people who couldn't afford the 5/5c/5s.

41. Jommick

Posts: 221; Member since: Sep 10, 2013

It's quite a bit. A large percentage of my sales are people who want an 8gb iphone 4/4s. Heck, there are still people who get the iphone 4s for $0,99 USD.

6. ThePython

Posts: 902; Member since: May 08, 2013

I'm not surprised at all. Most iPhones I see here are either 4/4s. Although I do see the 5/5s from time to time. Never a 5c. Lol.

15. xoxoGeorges

Posts: 209; Member since: Jul 11, 2013

Only time I've seen the 5c is in a store lmao.

27. dontneedtoknow

Posts: 158; Member since: Feb 17, 2014

It's really popular with teens! Most people at my school have iPhone 5c. I have seen more than 30

8. PermanentHiatus

Posts: 267; Member since: Jun 22, 2012

Poor iPhone 4 and 4S users, can't connect to LTE :(

9. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

Who cares? The carriers have ruined LTE with high prices, ridiculous data caps and rapacious overage fees.

37. tedkord

Posts: 17452; Member since: Jun 17, 2009

Being as I'm on Verizon, I'd care. I've lived through Verizon's 3g, it's worse than the dialup I had at home a decade ago. I was getting like 5kbps max. Every once in a while I hit an area with 3g, my phone is unusable.

48. microsoftnokiawin

Posts: 1268; Member since: Mar 30, 2012

in australia 4g(LTE) is faster then anything we are able to get at home lol !

39. xche78x

Posts: 101; Member since: Mar 11, 2014

yeah ISP's are crap, having a very small limit (data cap) defeats the purpose of having fast internet connection. worse are the philippines telco's in asia, they cap their slow 4g lte (1.0-2.5Mb) to 1.5gb a month data download, imagine a single HD documentary to watch on youtube then its almost no internet with 2g for the rest of the month... 3g is spotty too, you get 2Mb connection on some areas then almost zero on some areas.. one can even get zero internet even if the 3g signal is on full bars... 3g has 800mb daily cap which is better than 4g lte's cap. All phillipines telco's cheat their customers with having expensive, inconsistent and intermittent service. Support is next to non-existent unless you are a business plan subscriber. One you signed their contract you are doomed to pay for incompetent service and are forced to pay termination fee if you want to sign out of their sucky internet connection... many people who signed up for 3-5Mbps LTE home service for globe only get average of 0.02-0.6Mbps, calling tech support will only make you pull your hair and vomit in disgust.... my iphone 4s is getting sluggish even though i only installed few messaging apps.... probably time for upgrade when ip6 comes out

10. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

LOL...South Korea already have LTE-Advance, so don't be proud of having LTE. And also, some countries still don't have LTE. LTE is not everything.

20. power_x

Posts: 264; Member since: Aug 28, 2013

In Egypt they don't even have proper 3G networks

49. microsoftnokiawin

Posts: 1268; Member since: Mar 30, 2012

well it depends on where you are and yet they've started implementing LTE networks !

11. Sauce unregistered

LTE is glorified unreliable 3g .

14. Finalflash

Posts: 4063; Member since: Jul 23, 2013

Are you joking or something? 4g is bloody amazing here in the UK. My bro is on EE and his 4g is always great but kinda slow at 30 mbps. I went with 3 since I live in London or Manchester usually and the 4g is usually a ridiculous 40+ mbps. Even my 3g is about 20 mbps though but with unlimited 4g I literally watch HD videos exclusively anytime.

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