Apple’s iPhone 4S

Wingfield, Nick. "Apple's Profit Gains 54%, but iPhone Sales Fall Short of Expectations." New York Time 19 10 2011, B3. Print.

Nick Wingfield writes about the introduction of the new iPhone 4S by apple in his article, Apple’s Profits Gains 54%, but iPhone Sales Fall Short of Expectations, in The New York Times on October 19, 2011. The article talks about how the new iPhone 4S did not sell as much as was expected and sales were down in the third quarter. These results caused a seven percent decline in apple shares. Many people were delaying their purchase of a new phone in order to get the new iPhone. But, many of these people were disappointed in the new product. Consumers were expecting an iPhone 5 not an iPhone 4S. Apple’s explanation is that this new iPhone 4S sold more than four million the first weekend it came out, this is more than double the sales of past iPhones. Revenues have gone up from previous years but what hurt Apple the most was that they did not reach expectations. People were very excited to get the new iPhone 4S and they were expecting a lot.

Sometimes surprises like this are good and other times they just back fire on companies. Customers were expecting an iPhone 5 to come out and what they got was an iPhone 4S. Yes it’s new and better but not that much different from the iPhone 4. Apple believed that this would get customers on track with them. Apple assumed that most people that have the iPhone 4 are still on their two year contract and it won’t be until next year before they will get a new phone. Therefore, Apple decided to come out with the iPhone 4S and leave the iPhone 5 for a time closer to iPhone 4 users’ contract renewal. The idea behind Apple is reasonable but customers did not agree. A lot of people are upset and the decline in Apple shares is evidence.

On the other hand, the iPad have had a tremendous success. Apple has sold more than 40 million iPads since they came out 18 months ago. Their Mac notebook computers are also doing well in the market. A big competition for Apple in the phone industry is Google with its Android operating systems. Android has 43.4 percent of the market while Apple has only 18.2 percent. There is a big contrast between the two competitors. Apple, on the contrary, is expecting its sells to go up in this holiday quarter. But, all we can do right now is wait and see how the customers react during this quarter. Overall, if Apple would have came out with the iPhone 5 instead of iPhone 4S, sales could have been drastically different. The perceived value of getting an iPhone 4S if you already have an iPhone 4 went down. These people might as well wait for the iPhone 5.