The Slowly Coalescing Narrative of the iPhone 5C


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After last week’s iPhone announcements, there has been no dearth of stupidity and echoing of Apple is doomed!-mantras. Today in the Guardian Aditya Chakrabortty trolls as follows:

treading water is what Apple has done ever since, sadly, it lost Jobs. Under the turtlenecked-one, we got the iPod, the iPhone and the iPad, one after another.

Chakrabortty writes as though Steve Jobs was just sitting at his desk while the iPod formed from his head fully formed on Monday, the iPhone appearing ex nihilo on his chair on Wednesday and he just shat out the iPad on Sunday. Here in the real world, of course, the iPod was released in 2001. The iPhone in 2006. The iPad in 2010. That’s 5 years from iPod to iPhone, and 4 years from iPhone to iPad (even though according to detractors at the time it was just a case of sprinkling growth powder on the iPod Touch). Everything that Apple has been doing in the past two years (Siri, fingerprint authentication, 64-bit iOS etc) makes me believe they are laying the groundwork for one or more potentially revolutionary products. Whether or not they will succeed again is a whole other matter, but let’s not write the company off for not changing the world every fortnight.

There is, however, one area of criticism which is utterly valid: the price of the iPhone 5C (or 5c or whatever it is today). With the supply chain leaking just about any new product Apple ramps up into production, it is easy to think that we know everything before these events. Analysts, who almost always get it completely wrong but who still get tons of money to spew their nonsense, were drumming up the notion of a low-price iPhone for sale in Asia. And so when we saw the plastic shells of the iPhone 5C leaked, everyone thought that it would indeed be a lower-cost phone. It wasn’t. It is going to sell for USD 549 out of contract. That’s not cheap. That’s not low-price.

Can you hold a company accountable for something they have never claimed? Something they never promised? Shareholders seem to think so as the stock price dropped over 5% after the announcement. But what do shareholders know? Stock price dropped 11% the day after the iPad was announced and look how utterly unsuccessful that product became.

So my criticisms regarding the 5C and its unappealing narrative has nothing to do with Apple is doomed!-mantras or with analyst or shareholder reactions. Rather, the 5C is a step in the wrong direction for Apple because the choices they made in making and marketing that product are un-Apple.

Jean-Louis Gassée refutes claims that Apple needs to make a cheap iPhone, with his post on Mondaynote beginning as follows:

Remember netbooks? When Apple was too greedy and stupid to make a truly low-cost Macintosh? Here we go again, Apple refuses to make a genuinely affordable iPhone.

But there is a big difference between the perception of, say, the MacBook Air and iPhone 5C. The Air was too expensive when it first came out but gradually the price began to drop to the level where, yes it was still a thousand dollars, but it was far far lower than the initial price in 2008 of USD 1799. When Steve Jobs claimed that Apple didn’t know how to make a sub-500 dollar computer that “wasn’t a piece of junk”, we believed him – especially since other manufacturers struggled to even compete with the MacBook Air on quality and price until fairly recently.

This isn’t the case with the 5C which goes for a whopping USD 549 out of contract (only a hundred dollars less than the 5S which seems to be a great phone by the by) while having to compete with the USD 199 Nexus 4. What makes the pricing of the iPhone 5C egregious isn’t that they didn’t find a way to make it cost USD 199 out of contract, however. Apple does not cater to that market and it never has. It’s rather that Apple has created a product that gives a higher profit margin to Apple, while passing on absolutely none of those savings to the customer. This doesn’t mean that the phone will be a flop – I think the vast majority of iPhone buyers don’t really care about specs – but it is the first utterly cynical move that I have seen Apple make. Apple used to offer you a better product at the same price as the old product, now they’re offering you an ever so slightly worse product (I don’t care how much Jony Ive channels Wordsworth, plastic is a lower quality material than the metal of the iPhone 5) at the same price that last year’s iPhone 5 would have been. You are getting less for your money, but because its colourful and shiny, you feel that you’re getting something “new”. That’s cynical.

Even usually clear-headed writers like John Gruber have to resort to marketing reasons for why the 5C will be successful:

In marketing, what looks new is new.

Sure, but compare this to when the 4S was released two years ago and Gruber wrote:

Apple isn’t going to make a new form factor just for the sake of newness itself — they make changes only if the changes make things decidedly better. Thinner, stronger, smaller, more efficient.

That is a sentiment that I used to agree with, as well. Until now.