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iPhone 6 Plus boosts U.S. 'phablet' share, but the smaller iPhone 6 is what sells

Gregg Keizer | Dec. 4, 2014
5.5-in. and larger smartphones jump from 2 percent last year to 10 percent; this after Apple enters big-screen sweepstake.

With more Americans shifting to non-contract mobile plans, it was important this year, and will be even more in the ones to come, that Apple have devices that cost less than the non-subsidized $649-$749 for entry-level iPhone 6 handsets.

"This begs the question of what you want to achieve going forward," Milanesi said of Apple. "Their original pricing of the iPhone 5C wasn't low enough to do what they wanted to achieve, so I think there's still room for Apple to finesse its offerings."

Although speculation has mounted that Apple will dump the plastic-cased iPhone 5C from its lineup, Milanesi thought that would be a mistake, and that Apple would be smart to retain not only its multi-tier approach but differentiate the lowest-priced iPhone from others with a unique look.

"The iPhone 5C is still a good proposition, especially as more flexible plans become more popular," said Milanesi, ticking off other reasons to retain the 5C or something similar, including its ability to draw in mid-tier Android users and appeal to younger buyers.

Not surprisingly, most of the iPhone sales in the August-October span were to Apple loyalists, with prior iPhone owners accounting for 85% of the iPhone 6 and iPhone 6 Plus sales. Only 9% were deserters from Android.

That relatively few buyers came from the Android camp should not be a shock, said Milanesi, who added that the percentage of "churners" would increase with time because early stages of a new iPhone are typically dominated -- and seem to have been during this cycle, too -- by the most hardcore Apple customers.

Milanesi also pointed out that iPhone 6 and iPhone 6 Plus buyers both cited screen size as their primary reason for choosing their device, with that factor representing 60% for the iPhone 6 and 58% for the iPhone 6 Plus in store exit polls.

"That tells me that the size of the iPhone 6 is big enough for a majority of people," Milanesi said.

 

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