Internal Apple document acknowledges threat to iPhone from larger Android smartphones

While Apple continues to maintain that the iPhone is a better product than Android phones, an internal document reveals that the company is well-aware of the threat to the iPhone from cheaper and/or larger Android phones. A portion of the document was presented in the ongoing Apple-Samsung trial, which says that the growth of the iPhone could stall because of larger or cheaper Android phones: Internal Apple documents show the concern, at least from the company’s sales force, that the portion of the market occupied by the iPhone was on the wane amid growing competition from Android devices that have either larger screens or lower prices than the iPhone. The document, which was presented as part of Samsung’s cross-examination of Apple Senior VP Phil Schiller, noted that all the growth in smartphones was coming either from large-screen devices costing more than $300 or from devices that cost less than $300, with the segment that included the iPhone showing decline. The document also highlights the improvements Google and its manufacturer partners have made to Android hardware and the entire ecosystem, which has been an Apple strong hold. Apple also worries about the “obscene” amounts of money spent by certain Android rivals (Samsung, mostly) on advertising and carrier channel to gain traction. The document says that carriers have an interest in limiting iPhone sales as it involves huge subsidies to be paid by the carrier. While the document comes from inside of Apple, the company’s marketing chief Phil Schiller says that he didn’t agree with “much of the document.” We suspect that he does agree with the larger display Android phones posing a threat, as Apple is widely rumored to introduce 4.7-inch and 5.5-inch iPhones this year. [via Re/code] Continue reading →

from iPhone Hacks | #1 iPhone, iPad, iOS Blog » iPhone 4 Camera Beats HTC EVO 4G, Samsung Galaxy, Droid X In Showdown