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Analyst Roundup: Bullish on the iPhone

Robert Palmer

UBS analyst Maynard Um says that Apple could sell 7 million iPhones in the first quarter of the year if they sell a low-cost, 4GB model, according to Electronista.

Citing "checks" with industry partners, Um claims a 4GB model is in the works, though it's unclear if it will be a regular iPhone at a lower price point, or a smaller iPhone nano device rumored to be in development. While it may cannibalize sales from the current low-end 8GB model, a significantly lower price could add 1.5 million more sales for the quarter.

Generator Research's Andrew Sheehy goes even further, projecting that Apple could sell 77 million iPhones by 2013, according to Philip Elmer-DeWitt. Sheehy has three reasons why Apple will dominate the smartphone business:

  • Apple's ability to combine hardware and software, making it easy for users to consume
  • The App Store's vertical platform model leads the market so far
  • Smartphones are the only kind of phone that Apple makes, unlike other handset manufacturers like Nokia.

Sheehy says that, among other recommendations, Apple must broaden its offering to include higher- and lower-end units, including tablets and entry-level smartphones: All with access to the App Store.

He also says that Apple will capitalize on the paralysis brought on by a weak global economy, and use its cash to get "one or two design cycles ahead of the competition."

"When rivals start spending again, they may discover that Apple has built an unassailable lead," Sheehy writes.

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