Smartphone Wars: After Apple's iPhone Upgrade
Newer, faster, cheaper.
Apple's $199 3G iPhone and MobileMe, an upgrade version of its Mac syncing service, should successfully give shares a shot at a new leg up. It's simply too tough to argue that sales won't be absolutely huge now that the iPhone has moved from must-have status gadget to can-have everyday phone for tens of thousands of new users.
Apple gained 1.5 percent today, though shares fell after the hype ahead of the announcement. (Here's the big moment, complete with Steve Jobs, at AllThingsD.com.)
So what about the competition?
Research In Motion, maker of the BlackBerry, has kept up with Apple until now, and it looks like the latest upgrade by its chief rival marks a continuation of hostilities rather than a victory. The argument goes that a cheaper iPhone will probably eat into BlackBerry sales at the consumer level, where carriers are already giving away models like the Pearl at low or no cost after rebates, and at the professional level, where Apple sales have started to rise.
But the smartphone market is still just getting started. Citigroup raised its price targets for both RIM (heading to $165) and Apple (heading to $287). Consider Citi's iPhone sales estimates: In the second half of calendar '08, sales jump to 12 million from 8 million. For '09, Apple moves 23 million units vs. 16 million, and in '10 sales hit 28 million iPhones. Other analysts put the number even higher.
The loser here is Palm. It might still manage to carve its niche among carriers that don't offer the iPhone, but the future looks like it belongs to RIM and Apple. Analysts at S&P left shares of Palm at "sell" after the announcement and upgraded Apple to "buy" from "hold."
Tags: Apple Inc. | stocks | iPhone | BlackBerry
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Reader Comments
Undeniable of FL
Since hundreds of millions of cell phones are sold every year, the Itoy's highly questionable 10 million of sales is an infinitesimal drop in the bucket. I suppose Undeniable of FL stayed up all night waiting for his new IBoner and then through a temper tantrum when he couldn't make any calls or download Barney songs to his IBoner. I wonder if he through it on the floor and jumped on it when he couldn't change the battery. But then that's what children do until they grow up and need real productivity tools.
Truthseeker
Let me guess, dad works for Palm? Rimm? The facts are simple and clear. The 1st release of the Iphone was dramatic. Market share going down for Iphone? Apple stopped making the original Iphone 8 months ago because who would buy one knowing a better model was coming? The 3G Iphone will take over the market. The only thing Apple lacked was 3G and security for emails. I have Blackberry Curve and it a glorified email phone. Internet component is almost unusable. It's like having a radio that can only tune in even numbers. Calendar function is like working with DOS.
Like it or not, Iphone is here to stay. Best of luck using substandard products.
IPhone
Alt of CA must have missed the gigantic screw up of the launch of the new IBoner if he thinks that there are problems with my thinking. What kind of intellectual giants sit out all night to buy a cell phone? The kind who find after they've wasted hundreds of dollars of their time that they can't even get on the horrible network AT&T provides or Apple's feeble attempt at a music monopoly.
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