Apple shares decline on unveiling of new iPhones
Apple (NASDAQ:AAPL) unveiled its next generation iPhones Tuesday, introducing two models that will attempt to keep pace with the rapidly expanding smartphone market. The new iPhones come in two designs: the iPhone 5C, which will be available in five colours and made of plastic, and the iPhone 5S, the proclaimed “gold standard” of smartphones, which is capable of reading user fingerprints. Apple’s new strategy is perhaps an indication of just how big the smartphone market has become. Once a trailblazer in the mobile market, Apple is now taking a page out of its competitors’ playbook, introducing cheaper, colourful alternatives to its catalogue.
The iPhone 5C is powered by Apple’s A6 chip and features a 4-inch Retina display. It’s also the cheapest new iPhone to ever make it to market. The 16 gigabyte model will cost $99 on a two-year contract, and the 32 gigabyte model will run for $199.
The iPhone 5S features the new A7 chip, which is twice as fast as its predecessor. The 5S will come in silver, gold and grey, and features significant camera upgrades, including several automatic features. The “gold standard” iPhone also features a fingerprint reader, the Touch ID, which allows users to unlock the phone with one touch. According to Apple CEO Tim Cook, the new operating system, iOS 7, will be available for download September 18th.
Apple shares fluctuated throughout the day before declining more than 2.2 percent to $494.64. The maker of the iPhone and iPad has declined more than 23 percent over the past year after surpassing $700 a share in October 2012. The company’s latest attempt to diversify its flagship product comes as rival phones from Samsung and others continue to eat away at Apple’s market share.
In 2012 Apple was the second-largest smartphone vendor, shipping more than 136.8 million units to claim 25.1 percent of the market. Samsung increased its share of the smartphone market by more than 129 percent between 2011 and 2012, shipping close to 216 million units last year. Samsung is currently the undisputed leader in the smartphone space, representing 40 percent of the market.
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