Cupertino: New iPhones set to be unveiled Wednesday offer Apple a chance for fresh momentum in a sputtering smartphone market as the California tech giant moves into new products and services to diversify.
Apple was expected to introduce three new iPhone models at its media event at its Cupertino campus, notably seeking to strengthen its position in the premium smartphone market a year after launching its $1,000 iPhone X.
To win over buyers in a tight market, Apple was reported to be launching handsets with 30 percent more viewing space without increasing the size of the devices.
“The big thing is going to be how they fit such a massive screen into such a small device,” said Patrick Moorhead of Moor Insights & Strategy.
One new iPhone was likely to be priced slightly lower than the X model to “capture the next wave of buyers” in markets such as China, western Europe and the US, according to Moorhead.
While the iPhone has made Apple the world’s most valuable company, worth more than $1 trillion, it has slipped to third place among smartphone makers as Chinese-based Huawei has grabbed the number two spot.
Research firm CB Insights said Apple is at a “crossroads” a decade after introducing the iPhone.
“Looking for the next wave, Apple is clearly expanding into augmented reality and wearables with the Apple Watch and AirPods wireless headphones,” the analysts said.
“But the next ‘big one’ — a success and growth driver on the scale of the iPhone — has not yet been determined. Will it be augmented reality, auto, wearables? Or something else entirely?” Still, many analysts say Apple has a formula that works with a loyal customer base.
While iPhone sales have slowed, Apple profits have risen along with the average purchase price of its handsets.
The newest and priciest iPhone “didn’t help Apple grow its user base but handsomely contributed with dollars to top line, bottom line and market cap,” Counterpoint Research analysts said in a note Tuesday.
Samsung, the world’s biggest smartphone maker, last month unveiled its latest flagship handset, the Galaxy Note 9, and next month Apple rival Google will hold an event at which it is likely to showcase new Android-powered top-end Pixel phones.
Apple’s event comes with the global smartphone market largely saturated, without a major catalyst for sales ahead of a likely rollout of 5G, or fifth generation wireless networks, expected in 2019.
Research firm IDC expects worldwide smartphone shipments to decline 0.7 percent in 2018 to 1.455 billion units, with growth likely to resume as 5G devices become available.
“We still believe the smartphone market has some healthy growth in the years to come, although finding and competing in those markets and segments is increasingly more challenging,” said IDC analyst Ryan Reith.
Apple has sold more than a billion iPhones since the first model was unveiled by late co-founder Steve Jobs in 2007.
The company is in the unique situation of controlling the hardware and software in its mobile devices, with content for users required to go through its App Store that takes a percentage of revenue.
With the smartphone market showing little room for growth, Apple has been working to diversify its revenue streams with software, services and other devices including its smartwatch.
The event may see the Apple Watch getting its first significant redesign since its launch three years ago.
“I think that in the long run the watch will be a much larger business than people give it credit for; where Apple can iterate and grow,” analyst Stephen Baker of NPD said.
Apple chief executive Tim Cook has touted fitness and health features of the company’s smartwatch, which dominates that market.
The culture-changing company behind the iPod, iPhone and iPad hit a historic milestone last month, becoming the first private-sector company to surpass $1 trillion in market value.
The landmark was the latest victory for Tim Cook, who faced skepticism when he took over as chief executive in 2011 from Jobs just before his death.