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Opinion: Seeing Through Apple's "New" iPhone 5c Illusion

No really, it should; I've read the comments.

I trust that most of you have already caught a ton of the news, previews, early reviews, and analysis concerning the new iPhones. So I’ll spare you the ad nauseam re-hash of the facts, and cut straight to the chase: this is an editorial opinion piece about Apple's “new” iPhone 5c.

It Sure Ain’t Cheap

While I’m not one to readily buy into rumors or the predictions of "analysts", the fact that Apple’s new base model iPhone 5c is about $50 more than even some of the highest estimates floated during the pre-launch hysteria, is pretty surprising. Then again, Apple never promised an entry-level iPhone, so we can't blame the company for that letdown. Instead, the speculators got it wrong again. What did we really expect? After all, Apple doesn't compete in the entry-level of...well, anything.

Regardless of what the forecasters led us to believe, the iPhone 5c is, nevertheless, one of the most lackluster reveals in Apple's history. To see just how absurd this “new” product truly is, you need recall last year's iPhone 5, and have a little background on Apple’s previous iPhone launches.

Past iPhone Lineups

Before last Tuesday, Apple only introduced one new model per year. When a fresh iPhone came out, the previous year's version dropped in price to become a mid-range offering. Meanwhile, the iPhone from two years ago fell another $100 to become the low-end model.

You can’t entirely fault Apple for this strategy because, at least from a capitalization standpoint, it's actually pretty brilliant. The company gets to concentrate on just one new smartphone each year. Early adopters pay a premium for the latest technology while it’s still new. By the time the next one comes out, the company has maximized its margins, paying for a lot of that R&D and manufacturing, and can continue utilizing its production line.

Incidentally, this is also why Apple products hold their value for so long. The previous two models aren’t technically old phones; they’re the current, lower-end models. Well, that’s the way it worked previous to last Tuesday, anyhow.

The New Order Of Things

Unfortunately for those who hoped to pick up last year’s iPhone 5 at a $100 discount this holiday season, Apple has altered the deal. This year, the company broke from tradition by introducing two “new” phones.

The table below shows the full off-contract prices for Apple’s 2012 and 2013 iPhone line-up (base models):

FlagshipMid-RangeLow-End
2013iPhone 5s @ $650iPhone 5c @ $550iPhone 4S @ $450
2012iPhone 5 @ $650iPhone 4S @ $550iPhone 4 @ $450

As you can see, instead of launching a low-cost iPhone, which the rumors were suggesting, Apple pretty much did the same thing it always does. The three-year-old iPhone 4 says sayonara. The two-year-old iPhone 4S drops $100 to become the low-end model at $450, and the 5c is a regurgitation of the last year’s iPhone 5 at the mid-range price of $550. With everything the way it's been for years, there's nothing more to see, right?

Not entirely. While the pricing structure is static, the products are not. The iPhone 5c is not the iPhone 5.

The “c” Is For Cheapskate

While the iPhone 5c has Apple’s newer front-facing camera and it sports a slightly larger battery, for all intents and purposes, the iPhone 5c is the same as the iPhone 5 on the inside. For the same $100 discount typically offered every year, you still get last year's model. That is, sans the precision-machined polished aluminum structure - it sounds way better if you read it in Jony Ive’s voice.

That metal chassis is now a premium feature reserved for the $650 flagship model. Ironic, right, given the a big deal Apple made about its switch from the iPhone 3GS' standard plastic casing to the iPhone 4's all-metal chassis in 2010. It’s even more bizarre with the current low-end iPhone 4S still sporting a premium metal skin.

Look At The Pretty Colors!

Yessir, the P.T. Barnum routine was in full swing in Cupertino last Tuesday. Anything to keep the people from thinking about last year's iPhone 5 - Elvis Costello, ladies and gentlemen, Elvis Costello!

Ignore their parlor tricks, and don’t let the choice of colorful shells fool you, either! The step backward in construction materials is bad enough, but the new plastic chassis is nearly 9 mm-thick, compared to the 7.6 mm of last year's iPhone 5 (and the new iPhone 5s). This puts the iPhone 5c much closer in both thickness and weight to 2011’s iPhone 4S, which, because of Apple’s tendency to reuse parts, is 2010’s iPhone 4 on the outside.

Step right up! Today you can buy a heavier, bulkier, plastic version of last year’s phone for the same price you would have paid for the real-deal iPhone 5, had we just left everything the way it was. Poof! Voila! A "new" iPhone! See? It’s Magic™!

Please. The iPhone 5c's newness comes from a downgraded exterior, and the only thing improving is Apple's margin on the mid-range models. If iPhone 5c customers buy more than one of those $30 rubber cases, as Phil Schiller predicts, the company could end up making more on this than any previous iPhone model.

At the end of the day, I’m once again left in awe of Apple’s world-class marketing. No other company could get away with presenting its customers with a worse deal than it offered previously and still generate positive feedback from the tech press. Kudos to the financial reporters for immediately seeing through the reality distortion field, even if for completely different reasons.

Hey Apple, next year, let Elvis stay home. Instead, just cue up the circus music and get a unicycle-riding poodle in a Shriners cap to do a few laps around the stage. You'll have a better shot as distracting me with that.

Follow @adamovera and @tomshardware on Twitter.

  • ps3hacker12
    great breakdown and a nice read, kudos to whoever wrote this.
    Reply
  • hannibal
    :-)

    iPeople make IT with bigger margins!
    Reply
  • wildkitten
    Not sure what the criticism is. As the author pointed out, Apple isn't doing anything different than it has all along. The 5c is at the same price point as the 5 would have been had they followed their same pricing from previous years, but the 5c does have some upgrades over the standard 5 which the author also pointed out.

    As for the case, sorry, not everyone prefers metal. And people can't praise the Moto X for it's colors on the one hand and then criticize Apple for doing it as well. It's still a very solid, well made phone. My S4 is made from a very good plastic and I prefer it, no matter how many people criticize it.
    Reply
  • jeepmanjr
    I feel ya. Personally? I think Apple represents overpriced yuppie toys. No Apple toys in my household. If you disagree, perhaps a history lesson is in order. Apple had an outstanding opportunity back in the day, they were greedy (very much like today) and squandered their opportunity(ies). Enter IBM and, ultimately, Microsoft. And here we are. LOL!! Please, spare me your juvenile Apple rants.
    Reply
  • adamovera
    11577282 said:
    Not sure what the criticism is. As the author pointed out, Apple isn't doing anything different than it has all along. The 5c is at the same price point as the 5 would have been had they followed their same pricing from previous years, but the 5c does have some upgrades over the standard 5 which the author also pointed out.

    As for the case, sorry, not everyone prefers metal. And people can't praise the Moto X for it's colors on the one hand and then criticize Apple for doing it as well. It's still a very solid, well made phone. My S4 is made from a very good plastic and I prefer it, no matter how many people criticize it.

    Apple took away a premium feature in exchange for a couple of minor things, yet left the pricing the same. It's a raw deal that clearly only benefits the company's bottom line.

    Now, had it killed off the 4 /4s and priced the 5c @ $450 (eliminating the mid-range altogether), that would have been a far more solid, though still too weak, entry-level move. Alternatively, if the company added the battery, camera, and/or color options to the metal iPhone 5, yet kept it at $550, that would have been a value-add to the existing order of things.

    As to the Moto X comment, I've never even seen one. However, I'm pretty sure the color options are a carrier-specific gimmick. On paper, it looks like a mediocre handset that's priced too high off-contract to make it interesting - to me, anyway.
    Reply
  • Yuka
    I'm thinking that to keep the same price point they went plastic; otherwise they wouldn't have been able to put the new camera in, right?

    Cheers!
    Reply
  • Thierry Martin
    Apple bashing seems to be turning into a mental disorder.
    Reply
  • vmem
    I never thought I'd say that Apple botched a marketing campaign, but they did on the iphone 5C

    well, it may not really be the fault of the marketing team, but the phone is perceived as cheap, while the internals are far from that. This article points out all of this, and it comes down to the fact that Apple made a phone that people are only willing to buy at a lower profit margin to Apple...
    Reply
  • lansiman
    poor is the root of all sins,this is a very biased article
    there are dumb baboons that doesn't know how corporates runs
    everybody wants to be in Apple position from perspective of market power,the only reason other manufacturer like samsung LG doesn't set high price is because they can't,nobody would buy an S4 at the same price as 5S,like nobody would buy a corolla at BMW price,they sure did if they can,they are not out for charity
    cheapskate is those who expect a company to sell whatever stuff cheaply,and can't look past anything other than just the obvious
    Reply
  • sephirothmk
    Low end phones cost 450$? Holy kittens, I've been living under a rock!
    Reply