Apple plays to the middle market with colourful iPhones

A play-safe appeal to Apple fans with a traditional, higher-specification upgrade.

Seasoned Apple watchers will have successfully predicted nearly all the hardware in the two new iPhones that have just been unveiled by CEO Tim Cook in a hotly anticipated presentation. But while one model conforms to the tried-and-tested tech upgrade trajectory we have seen in recent years, the other is a bit more of a mould-breaker – not least because it’s made largely out of plastic.

Sticking to the familiar two-year lifecycle in iPhone designs, Apple has upgraded the iPhone 5 to the 5S. This comes with a few hardware tweaks – most notably a significantly increased performance thanks to the newly developed A7 processor which is as powerful as that found in a desktop computer. It has tapped into the burgeoning market for health and fitness add-ons by including a distinct M7 chip, designed to efficiently (continuously) measure motion data. Until now, this had been a big drain on battery life.

The tradition of Apple bringing what were once expensive professional level features to the consumer market continues. Following on from face and voice recognition in iPhoto and Siri, we now have the introduction of a fingerprint reader on the phone. This combines high security with ease by allowing the phone to be unlocked with a single touch from the right person’s finger. Whether this is just a fad will be for the market to decide.

Security is at the forefront of many minds these days when it comes to technology purchases. Apple made no promises about stopping government security agencies from reading all your tweets and emails, but it has promised that fingerprints will not be stored on its databases, which should allay concerns about the NSA getting its hands on even more personal information about you.

The 5S also has a better camera lens, and flash and camera software are combined to offer better pictures, slo-mo video and better low light pictures. For a touch of glamour, you can get your 5S in gold as well as the traditional white and black.

But the foray into colour doesn’t end there. The iPhone 5C, announced alongside the 5S can be yours in green, yellow, blue, white or pink, if you’re willing to overlook the slightly odd Connect Four-style cutouts on the back of the case.

The iPhone 5C is significantly different. Some of the prestige hardware has been replaced with polycarbonate to cut costs so Apple can sell a 16GB version for $99 (although you’ll be locked into a two-year contract). Apple’s previous strategy entailed selling last year’s model at a cheaper price in order to maintain demand for the newer product. Whether there is a big enough differentiation between the 5C and the high-end product is difficult to predict, but the price tag suggests that they will sell.

Observers like to carry out “teardowns” of technology products to work out profit margins based on the cost of a device’s component parts. Teardowns of last year’s cheaper iPad mini seem to suggest that although profit margins may have been down on earlier models, Apple maintained its 50-58% margin on each device. It would be no surprise to discover that Apple has found a way to apply these manufacturing techniques in this cheaper iPhone while maintaining the same build quality and margins.

The 5C seems to be directly targeted at the midrange sector and emerging markets, which are currently dominated by Android phones. In a nod to the importance of emerging markets, Apple will release the new phones in China on 20 September, at the same time as launching them in the US and the UK, meaning Chinese Apple fans won’t have to wait any longer. That said, phones that have succeeded in the Chinese market before now typically have a wider screen size than Apple is offering.

Are the new features of the iPhone 5S enough to make it worth upgrading? If you currently have an iPhone 5 then probably not, although you could sell on your old device to offset the cost of switching. Many consumers will be coming out of an 18-24 month contract soon and may be sitting on iPhone 4 or 4S models – the longer screen, better battery life and camera may be enough of an inducement to switch to the new versions.

Alternatively, owners of iPhone 4 4S and 5 models have been promised an operating system upgrade at the end of this month, which will be like getting a new phone. This will be the first software that Johnny Ive has had a hand in designing following Apple’s reorganisation. The upgrade radically changes the interface, refreshes the apps and offers different features, something which has not occurred in any previous update. Anticipating that this degree of change may be a shock for some consumers, so Apple is reportedly prepping its online and instore support for those suffering from iOSTSD (iOS Traumatic Stress Disorder).

So, it’s nods to the middle and eyes to the East with the new iPhone launch but also a play-safe appeal to Apple fans with a traditional, higher-specification upgrade. Which version of the new iPhone is the bigger success may dictate future directions for the company.

Barry Avery does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

The Conversation

This article was originally published at The Conversation. Read the original article.

Apple chief executive Tim Cook praises the new iPhone 5S as the most refined model the company has ever introduced. Photo: AFP/Getty Images
Barry Avery is a Principal Lecturer in Informatics and Operations at Kingston University.
Photo: Getty Images
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How can the left make the case for immigration?

All too often, we drift into telling people we want to convince that they just don't get it.

We don’t give the public enough credit. You’ll often hear their views dismissed with sighs in intellectual circles. In fact on most issues the public are broadly sensible, most are these days supportive of cutting the deficit and dubious about political giveaways, but in favor of protecting spending on the NHS and education. Yet there is one issue where most, “knowledgeable” folks will tell you the public are well out of step: immigration. 

With [today’s] net migration figures showing yet another record high, it is an ever more salient issue. On a lot of measures ‘too much immigration’ ranks highest as the number one concern (see Ipossmori). The ongoing rise of right wing political parties across Europe demonstrates that simply enough. But concerns about immigration don’t just sit with those with more extreme views, they’re also shared across the mainstream of public opinion. Yet unlike thinking on cutting the deficit or funding the NHS the public consensus that immigration is bad for Britain, flies flat in the face of the intellectual consensus, and by that I mean the economics. 

Given the intense public debate many a study has tried to spell out the economic impact of immigration, most find that it is positive. Immigration boosts the nation’s GDP. As the theory goes this is because immigrants bring with them entrepreneurialism and new ideas to the economy. This means firstly that they help start new ventures that in turn create more wealth and jobs for natives. They also help the supply chains to keep ticking. A example being British agriculture, where seasonal workers are are needed, for example, to pick the strawberries which help keeps the farms, the truckers and the sellers in business. 

Most studies also find little evidence of British jobs being lost (or displaced) due to immigrants, certainly when the economy is growing. Indeed economists refer to such “ “they’re” taking our jobs” arguments as the “lump of labour fallacy’. On top of all that the average migrant is younger than the native population and less likely to rely on welfare, so their net contribution to the state coffers are more likely to be positive than natives as they don’t draw as much state spending from pensions or the NHS. 

So why haven't the public cottoned on? Many progressive types dismiss such views as racist or xenophobic. But it turns out this is to misunderstand the public just as much as the public ‘misunderstand’ immigration. When you study people’s views on immigration more closely it becomes clear why. Far from being racist most people asked by focus groups cite practical concerns with immigration. Indeed if you go by the British Social Attitudes Survey a much smaller number of people express racist view than say they are concerned about migration.  

The think tank British Future broadly set out that while a quarter of people are opposed to immigration in principle and another quarter are positive about it the majority are concerned for practical reasons - concerns about whether the NHS can cope, whether there are enough social houses, whether our border controls are up to scratch and whether we know how many people are coming here in the first place (we don’t since exit checks were scrapped, they only came back a few months ago). But more than anything else they also have very little confidence that government can or wants to do anything about it. 

This truth, which is to often ignored, begets two things. Firstly, we go about making the argument in the wrong way. Telling someone “you don’t understand immigration is good for our economy etc etc” is going to get a reaction which says “this person just doesn't get my concerns”. Despite the moans of progressives, this is precisely why you won't hear left leaning politicians with any nous ‘preaching’ the the unconditional benefits of immigration.

More importantly, the economic arguments miss the central issue that those concerned with immigration have, that the benefits and effects of it are not shared fairly. Firstly migrants don’t settle homogeneously across the country, some areas have heavy influxes other have very little. So while the net effect of immigration may be positive on the national tax take that doesn't mean that public services in certain areas don’t loose out. Now there isn't clear evidence of this being the case, but that could just as well be because we don’t record the usage of public services by citizenship status. 

The effects are also not equal on the income scale, because while those of us with higher incomes scale tend to benefit from cheep labour in construction, care or agriculture (where many lower skilled migrants go) the lower paid British minority who work in those sectors do see small downward pressure on their wages. 

It’s these senses of unfairness of how migration has been managed (or not) that leads to the sense of concern and resentment. And any arguments about the benefit to the UK economy fail to answer the question of what about my local economy or my bit of the labour market. 

Its worth saying that most of these concerns are over-egged and misused by opponents of immigration. Its only a small factor in stagnating wages, and few local areas are really overrun. But the narrative is all important, if you want to win this argument you have to understand the concerns of the people you are trying to convince. That means the right way to make the argument about immigration is to start by acknowledging your opponents concerns - we do need better border controls and to manage demands on public services. Then persuade them that if we did pull up the drawbridge there is much we’d loose in smart entrepreneurs and in cultural diversity. 

Just whatever you do, don’t call them racist, they’re probably not.

Steve O'Neill was deputy head of policy for the Liberal Democrats until the election.