Analysis, Mobile Computing, Opinion

Pricing Will Determine The Fate Of The iPhone 6 in Asia

After months of rumors and leaks, the iPhone 6 and iPhone 6 Plus are now official. Boasting screen sizes of 4.7-inches and 5.5-inches respectively, the new devices represent a shift in Apple’s (NASDAQ: AAPL) strategy as the manufacturer seeks to position itself as a viable contender in the large screen segment.

An 5.5-inch iPhone would be much more alluring to consumers in emerging markets like China and India, where the average screen size is at 4.7 inches. A recent survey conducted by market research firm Jana found that consumers in emerging markets like China and India favoured devices with a screen size of at least 5 inches. One reason for high desirability toward a large screen device is that in these markets, a smartphone is often a user’s only gateway to entertainment, with many first-time buyers in India not owning a desktop.

While a larger iPhone is much more alluring, the pricing structure for the device means that it will be out of reach of most consumers. The fact that there are a host of Android-based offerings, from the likes of Xiaomi, Meizu and others, that offer a similar set of specs for a third of the cost means that consumers are more inclined to buy handsets from local vendors than opt in for an iPhone. Samsung already found out the hard way, with the manufacturer losing out its position as the largest selling handset manufacturer in both India China to local vendors. A lack of innovation in terms of design and incremental hardware changes meant that the South Korean manufacturer was dethroned by the likes of Xiaomi in China, and Micromax in India.

Apple has never been associated with pricing, instead building its brand around a premium design and exclusive services, but that is now being offered by other vendors as well. Xiaomi, for instance, has launched its first smartphone with a metallic frame in the Mi 4, and from a design point of view, the device can hold its own when seen against the Samsungs and the HTCs of this world. As for services, Xiaomi has its own platform of services and content that is a great point of differentiation for users looking for something different to the traditional Android user interface. At the end of the day, the pricing will ultimately determine whether the iPhone 6 will do well in the region.