The Mystery of the iPhone 5C placement in Apple’s lineup

Apple Event 10th September 2013

As recent rumors have pegged, tonight’s Apple event will introduce two new iPhones – the iPhone 5S and the iPhone 5C.

We have seen enough leaks to know everything there is to know about the iPhone 5C’s five colors and construction, and how they are really just iPhone 5 innards in a new plastic housing.

That said, the exact placement of the iPhone 5C in Apple’s iPhone lineup remains a mystery up till now.

In a previous post, I had revealed that the iPhone 5C had a 4-inch screen and a Lightning port (thanks to my friends) and speculated that the iPhone 5C will replace the iPhone 4S at the lowest end of the iPhone lineup and complete the transition of the iPhone line to Lightning ports and 4-inch screens this year, leaving the iPhone 5S at the top and the current iPhone 5 in the middle of the lineup.

I still think that this will be the arrangement, but rumors (from idiotic analysts nonetheless) suggest that the iPhone 5C will replace the iPhone 5 completely, leaving only the two new iPhones (and the old iPhone 4S) in the iPhone lineup.

This is weird for various reasons.

Firstly, it will leave a big gap between the pricing of the iPhone 5S and the iPhone 5C, assuming that the iPhone 5C will be quite a bit cheaper than the iPhone 5S. Previous years, the mid-range iPhones have always been about 100USD cheaper than the top-of-the-line models, and people who are intending to buy mid-range this year will not be happy that they are paying for something that are not last year’s models, at the same top-range-minus-hundred price point.

Secondly, it will not be feasible to have the iPhone 4S remain on the lineup, for the extra effort Apple needs to maintain the dock connector accessories and the assumed extra cost of making the iPhone 4S’ metal and glass housing will outweigh the benefits of just letting the same production lines making the now lesser in demand iPhone 4S continue running.

The only reason/way I can see it (iPhone 5C replacing the iPhone 5) is if the supply yield of the delicate aluminum and glass housing of the iPhone 5 still remains small today even after one year of production, due to the care needed to prevent scratches on the soft aluminum on the assembly lines.

If that is truly the case, it will make sense for Apple to divert all current iPhone 5 housing production lines to the production of the iPhone 5S, to ensure maximum supply of the iPhone 5S on launch day (20th September) and in the months after that, especially with the rumored increase in color choice.

Plastic housings are extremely cheap and easy to produce (ask Samsung), and will be produced fast enough to meet iPhone 5C launch demand, and a big supply of iPhone 5Cs is need if China is going to be part of the first launch countries this year.

Apple will still have to adjust their prices accordingly, and there will still be a gap, unless of course they just went ahead with the old top-range-minus-hundred pricing assuming that people will pay for the "newness" of the multi colored iPhone 5C lineup.

Can’t wait for tonight! Will love a blue 5C.

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