Apple's iPhone will likely see positive acceptance when the device ships in June, according to research firm Goldman Sachs. Goldman points to a recent handset branding survey that was conducted in China, India, the U.K. and the U.S. as evidence that Apple's new gadget might yield positive results for the Cupertino-based company. Despite the fact that the survey took place before iPhone was debuted in January, the number of potential iPhone buyers is equivalent to 75 percent of the installed base of current iPod owners. Just under one-half of the potential buyers come from respondents who have never owned an iPod, and 71 percent of respondents in the U.S. indicated interest in a potential Apple cellular handset.Separately, Morgan Stanley says they would be buyers of Apple on incremental revenue and operating leverage. The firm believes the market is underestimating the likely success of iPhone. They're raising their annual unit and revenue forecasts to better reflect iPhone interest levels.
Morgan Stanley expects sales of eight million iPhones in 2007. A survey of 2,500 US consumers found that more people are interested in buying an iPhone than the combined number of people who already own or are planning to buy a similar high-end device soon(23 percent of non-owners compared to 19 percent of owners).
Apple ranked as the fourth most desired multimedia handset brand in the U.S. even before the iPhone was ever announced, and 30 percent of U.K. respondents alongside 15 percent of U.S. participants suggested that they would switch carriers in order to get the handset they want.
In fact, it is dangerous to underestimate the Apple brand machine. That isn't to say the company doesn't occasionally produce a dud. Think Newton, Pippin or Lisa. Of late, though, it has been on a roll.
ABI Research late last year said a study it conducted suggested many prospective MP3 player buyers, including current iPod owners, would be likely to choose Microsoft’s Zune over an iPod.
Of course, forecasts can be quite wrong. When 1,725 teenage and adult US residents were asked whether they planned to buy an MP3 player in the next 12 months, of those responding they were likely to do so, 58 percent revealed they were “somewhat likely” or “extremely likely” to choose a Microsoft Zune player over the iPod or another MP3 player brand.
This 58 percent that were likely to go the way of the Microsoft Zune – all identified themselves as existing iPod owners. The respondents owning other brands, 59 percent, were also “somewhat or extremely likely” to purchase the Microsoft Zune as opposed to another brand – including the iPod.
But sales of the Microsoft Zune appeared to be trailing off rather quickly after a fast start last November, leading some analysts to believe consumer interest is waning. Which is why watching what people do, not what they say they will do, is so important.
The player, which stayed in the top 10 in sales in the Amazon.com electronics category for several days following its launch, has now nearly fallen out of the top 100, recently hovering around position 96.
However, that buzz appears to have been short lived. Whereas the iPod is expected to sell as many as 15 million players this holiday season, analysts only project Zune sales of about 300,000 to 500,000 units at most.
Steve Wilson, ABI Research principal analyst, even has argued that iPod users don’t display the same passionate loyalty to iPods that Macintosh users have historically shown for their Apple products. The survey revealed that only 15 percent of iPod owners said that they were “not very likely” or “not at all likely” to choose Zune.
iPod Worldwide Sales
Q4 2001 - 130,000
Q1 2002 - 57,000
Q2 2002 - 54,000
Q3 2002 - 140,000
Q4 2002 - 219,000
Q1 2003 - 80,000
Q2 2003 - 304,000
Q3 2003 - 336,000
Q4 2003 - 733,000
Q1 2004 - 807,000
Q2 2004 - 860,000
Q3 2004 - 2,016,000
Q4 2004 - 4,580,000
Q1 2005 - 5,311,000
Q2 2005 - 6,155,000
Q3 2005 - 6,451,000
Q4 2005 - 14,043,000
Q1 2006 - 8,526,000
Q2 2006 - 8,111,000
Q3 2006 - 8,729,000
Q4 2006 - 21,066,000
Total = 88,708,000
Consumers aren't willing to pay what Apple Inc. may ask for the iPhone but if the price drops they'll switch their mobile service to AT&T Inc. in order to get it, according to results of another survey.
Online market research firm Compete Inc. surveyed 379 people in the U.S., most of whom had heard of the iPhone and have shopped for an iPod, to find out how interested they are in the device.
Among the 26 percent of respondents who said they're likely to buy an iPhone, only one percent said they'd pay $500 for it. When Apple introduced the iPhone in January, it said it would cost $500 on the low end.
Forty-two percent of those who said they're likely to buy the phone said they'd pay $200 to $299. Just watch. You'll get early adopters at whatever price iPhone costs. Then lower-priced units will appear. At $300, demand explodes.
