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Apple tailors two new iPhones for world market
by Staff Writers
Cupertino, United States / California (AFP) Sept 11, 2013


With week to go, iPhone fans already queuing in Japan
Tokyo (AFP) Sept 11, 2013 - Another wave of iPhone excitement has swept Japan, where Apple fans were queueing Wednesday for the new handset, more than a week before it hits the shelves.

A 44-year-old Japanese businessman began lining up outside the Apple store in Tokyo's glitzy shopping district of Ginza on Tuesday, hours before the US IT giant unveiled two new iPhones.

"I'm glad to have secured first place," Tetsuya Tamura told AFP, as he sat on a camping chair Tweeting on his iPhone 4, adding the number of people following him on the microblog has shot up by 1,000 since he began his vigil.

"Being here gets my adrenaline going," Tamura said. "I am using up my annual leave to be here, but getting the first handset will make it all worth it."

The iPhone goes on sale in Japan on September 20.

Apple on Tuesday unveiled its latest models to an expectant room in California. The company is offering the iPhone 5S, a slick new top-end model, along with iPhone 5C, a pared down version aimed at budget-conscious smartphone shoppers around the world.

Apple has suffered a decline in its global share of the lucrative market as Android-run models, led by Samsung, expand their presence.

The firm now has a window of opportunity in Japan, where the nation's biggest mobile carrier NTT Docomo will sell the gadget for the first time.

Although sales are now rocketing, Japan came relatively late to the smartphone, with many consumers preferring to stick to clam-shell models that have long-since looked outdated in other developed markets.

While mobile phone technology in Japan initially raced ahead of other parts of the world, it developed in ways that never took off elsewhere, leading to a phenomenon dubbed "Galapagos-ization", which slowed the introduction of smartphones.

Docomo is now looking to reverse years of lost business after watching domestic rivals cash in on the iPhone bonanza.

The firm, which has about 42 percent of the Japanese market, has lost more than 3.5 million subscribers to rivals since 2008, when SoftBank first rolled out the iPhone in Japan, local media have reported.

China web users say new iPhone 5C is too costly
Beijing (AFP) Sept 11, 2013 - Chinese web users dismissed the "low-cost" iPhone 5C as too expensive Wednesday, raising questions over Apple's ability to build up sales in the world's biggest mobile market.

But the new phone will retail in China for 4,488 yuan ($733) for the 16GB version, according to Apple's China online store, making it only marginally cheaper than the previous model, the iPhone 5.

It is also well above the $549 that an unlocked iPhone 5C will sell for in the United States.

The top-line iPhone 5S starts at 5,288 yuan ($864) in China, whereas the unlocked US equivalent is $649.

"I thought the cheap 5C version would be priced at one thousand or two (yuan)... I can't sell my kidney for this much," said one poster on Sina Weibo, China's hugely popular Twitter equivalent, referring to a teenager who sold a kidney to buy an iPhone and iPad last year.

"So this is the so-called cheap version? The 5C starts at 4,488 yuan in China. Haha, they treat the Chinese as peasants," said another.

With a network contract in the US, the iPhone 5C can cost as little as $99.

But unlike in North America or Europe, Chinese networks do not offer contract customers deep discounts on handsets, instead requiring a substantial upfront payment which is then refunded over the course of the agreement.

The new iPhone was launched globally at Apple's Silicon Valley headquarters in California on Tuesday.

Many domestically made smartphones are priced as low as $100 in China, which remains one of Apple's largest markets due to the popularity of its various products.

Apple on Tuesday unveiled two new iPhones, fielding a slick new top-end model along with one aimed at budget-conscious smartphone shoppers around the world.

"The business has become so large that this year we are going to replace the iPhone 5 and we are going to replace it with two new designs," Apple chief Tim Cook announced at the company's Silicon Valley headquarters.

Apple will begin taking orders on Friday, and on September 20 the two devices will go on sale in the United States, Australia, Britain, China, France, Germany, Japan and Singapore.

The iPhone 5C is part of Apple's bid to counter the flood of low-cost smartphones from rivals, most of which use the Google Android operating system.

Apple designer Jony Ive said that despite the lower cost, the polycarbonate iPhone 5C with a steel frame "is beautiful."

The iPhone 5C with 16 gigabytes of memory will start at $99 with a two-year US carrier contract and $549 without a contract -- $100 less than previous iPhone base models.

"The 5C is a no-compromise device," Gartner analyst Van Baker told AFP after trying out Apple's new phones. "It is just in a plastic case instead of a metal case, and they basically reduce the price by the cost of materials."

But Baker said it was an "open question" whether the price cut for the iPhone 5C would be enough to attract customers in emerging markets.

"Anyone expecting Apple to come truly down-market with the iPhone 5C was fooling themselves," said Ovum analyst Tony Cripps.

"The day that happens is the day the company signals that it has run out of headroom for expansion."

Apple would not name its China telecom launch partners, who might step in with subsidies to help push down iPhone prices there. Apple planned a separate press event in China on Wednesday.

The top-line iPhone 5S, which starts at $199 with a contract for US buyers and $649 without one, "is the most forward thinking phone we have ever created," said Apple vice president Phil Schiller.

"It is the gold standard in smartphones."

Schiller said the 5S model includes a speedier chip which puts computing performance on par with desktop machines.

"It has over a billion transistors in it," he said, adding that the device will be a mobile game lover's delight with blazing smooth, rich graphics.

The 5S will also have some 10 hours of talk time, or 40 hours of music listening, Schiller added.

Apple introduced a fingerprint sensor for the iPhone 5S as a new security measure in place of passwords.

"You can just press the home button to unlock your phone," Schiller said. "You can use it to authenticate iTunes purchases."

Schiller added: "We have so much of our personal data on these devices, and they are with us almost everyplace we go, so we have to protect them."

Reticle Research principle analyst Ross Rubin described Touch ID as a "show stealer" that addresses "a necessary annoyance that many consumers have to deal with many times a day."

Apple also broadened its color palette, announcing the low-cost phone in blue, white, pink, yellow and green, and the top-line model in silver, gold and a new "space gray."

Apple said its iOS 7 software will debut September 18. It includes a free iTunes Radio Service featuring more than 200 stations "and an incredible catalog of music from the iTunes Store."

The two new handsets keep the four-inch screen of current iPhones, despite some speculation Apple would boost the size to compete with larger phones from rivals like Samsung.

The smartphone market is now dominated by Android devices, with roughly three-fourths of all handsets, but a forecast by research firm IDC suggested Apple will increase its share this year to 17.9 percent from 16.9 percent.

IDC analyst Ramon Llamas said that with the 5C, "Apple is staking out its space in the lower-cost smartphone category."

Llamas said Apple is seeking to fend off lower-priced rivals while "it enjoys bigger profit margins and still maintains the aura of being an aspirational brand."

The event was a disappointment to some who were looking for a fresh device from Apple, such as a smartwatch or TV service.

"I think there was an expectation for that 'one more thing,'" said Roger Kay at Endpoint Technologies. "People were looking for some pizzazz and they didn't get it."

Apple announced separately a deal with Japan's biggest mobile phone carrier NTT DoCoMo to bring the two new iPhones to that country.

Apple shares sank more than $11 to $494.64 by the close of trading on the Nasdaq exchange.

gc/nss

APPLE INC

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