BY | January 29, 2013

Apple doesn’t seem to be in its best health right now. Not just stock market is an indicator of its slide in fortune, even the lack of enthusiasm among people across the world is worrying for the company and investors. There was always a sense of something new coming to the smart-phone market prior to every launch of new versions of iPhone, but with other smart-phone manufacturers making huge progress in the last two years, the sense of surprise and something new has been completely lost.

Now Apple’s iPhone and Samsung’s Galaxy S line of smart-phones are on almost equal footing and iPhone doesn’t really enjoy any real advantage over Samsung or for that matter top HTC handsets. This is dragging Apple stocks and also affecting its market prospects.

Apple Inc, one of the world’s leading technology companies is going through a rocky patch in sales of its iconic phone brand iPhone. Apple Inc missed the revenue forecast for the third consecutive quarterly results as the iPhone sales recorded sales below expectations which has started rumors of the company losing its control over consumer electronics.

Apple in its latest report has said that it has shipped a record number of 47.8 million iPhone devices, which is an improvement of 29 percent from the past year, but it still lagged the analysts’ projection of 50 million devices. The fire of slowdown rumors were fuelled by the news that Apple’s component suppliers in Asia have been informed about a possible production cut. iPhone accounts for half of Apple’s revenue.

Apple’s basics are still very solid. Analysts still have high hopes for Apple’s dominance, but agree that the pace will be hampered by others such as Samsung and Google, with Android galloping ahead rapidly. “If you step back a bit, it’s clear they shipped a lot of phones. But the problem is the high expectations that investors have. Apple’s conservative guidance highlights the concerns over production cuts coming out of Asia recently.”, said Shaw Wu, an analyst.

The question now arises is how the company, known for its snazzy and ultra-trendy devices, will fight off the reports of a slowing growth and what product it has in its arsenal. “You can’t just keep rolling out iPhones and iPads and think that everybody needs a new one,” said Jeffrey Gundlach, an owner of a bond firm. Gundlach sounded critical of Apple’s last release, iPad Mini, and questions the need to have such a device without any angle of innovation.

The competition has been rising steadily from a slew of new releases powered by Google’s Android operating system. There are also reports of a slowing smartphone market, which further tightens the noose for Apple, and calls for urgent innovation by studying changing patterns in market growth.

The lacklustre performance is being attributed to the changing mobile habits and somewhat influenced by iPhone fatigue, with a strong line-up of competing devices. Singapore had the world’s largest users of Apple products in 2010 with the maximum number of iOS devices per capita in Singapore than anywhere else in the world. Apple’s share of mobile devices in Singapore has declined sharply last year, falling from 72 percent in January 2012 to 50 percent this month. Meanwhile in the same period, Android has risen from 20 percent to 43 percent. Hong Kong has seen a dip from 43 percent to 20 percent in the last one year.

Many people believe that the Apple devices have lost the sheen that was present when Steve Jobs was alive. For Janet Chan, a Hong Kong advertising executive and a user of iPhone 5 is mulling switching over to Samsung Galaxy Note II, due to the former’s weak battery performance and the latter’s large screen. There also have been views that the company has lost its tag of being an ‘aspirational product’. Many feel that there are so many people with iPads and iPhones now that the edge of having one is lost, and there is no exclusivity attached to the product anymore.


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