The hype begins for the iPhone 5

Brace yourself: Apple Inc. is about to spark another iPhone frenzy.

The entire technology world will be watching Tuesday when the most profitable mobile device maker in the world hosts a media event in California. Although Apple has not announced what the event is for, just about everyone expects the company to unveil the newest iteration of its hyper-popular smart phone,the iPhone 5.

iPhone Developmemt
There's plenty of speculation – and almost no confirmed information – on the newest iPhone's specs. A number of blogs and media outlets believe the new phone will come with a four-inch touch screen and an eight-megapixel camera. The high-end device, which will probably sell for more than $600 (U.S.), will also almost certainly have a more powerful processor and slimmer frame than its predecessors.

The new phone is prompting Wall Street to forecast that Apple will post enormous sales in the October-to-December quarter, with shipments expected to be in the range of 29 million.

But just as important as Apple's up-market offering is its rumoured entry-level version of the iPhone 4, which many expect the company to unveil at the same event. Though Apple continues to reap most of the profits from the consumer smart phone market – it accounts for about 40 per cent of Apple’s revenue, with margins estimated at roughly 60 per cent – a slew of phones powered by Google's Android operating system have actually outsold iPhones this year. Android-based phones now constitute the biggest share of the smart phone market in many regions, including North America.

With a relatively cheap version of the iPhone 4, Apple hopes to counteract this trend, giving cost-conscious consumers an alternative to the multiple entry-level handsets available from competitors such at HTC and Samsung.

But beyond the gadgetry on display, there's greater significance to this week's iPhone event. The launch will mark the first major event in Apple's iDevice era to be led by the company's new chief executive officer, Tim Cook, and without any presence from Apple's founder, Steve Jobs. Mr. Jobs recently stepped down from the CEO position because of poor health, and everyone from investors to analysts to die-hard Apple fans will be watching to see how much of the founder's famous on-stage charisma Mr. Cook can muster.

For Apple, the stakes are higher this time around than during any previous iPhone launch. Until recently, the company had much of the market for high-end consumer smart phones to itself (with other players, led by Research In Motion Ltd., dominating the corporate and government market). But Android-based phones have improved in quality significantly this year; Microsoft Corp. is investing billions into its own smart phone operating system and RIM has released a number of attractive new BlackBerry models.

Still, in terms of desirability, few brands in any market compare to Apple's smart phone. A recent study by mobile ad network provider InMobi found that about 41 per cent of current mobile users in North America planned to buy the iPhone 5 – including 52 per cent of current BlackBerry users.

Source: theglobeandmail

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