The iPhone Nano — some supporting evidence

Last week I wrote about the inevitability of the iPhone Nano as a strategy from Apple. That will, I’m sure, manifest itself in a ‘cheaper’ iPhone range (say, £300 total cost) and, over time, price points way below.

Quite a few people questioned me on this.

“Apple’s no need,” they said, “Things are rosy,” they told me, “Apple don’t pay attention to shareholders,” they cheered, “There’s nothing wrong in iPhone land,” they chanted.

There is.

The problem is Android and shareholders who don’t know anything beyond the fact that Apple is currently being WIPED from the planet by the search engine behemoth.

You should have seen the emails arriving in my inbox from some financial analysts.

“How do you account for the fact Apple’s share has dropped by HALF in one year whilst Google’s almost doubled?” one senior chap asked me, “That would mean the market actually INCREASED massively since last year and that’s not likely is it?”

“Yes, that’s precisely what happened,” I wrote back, “And your darling [Apple], couldn’t hack the pace.”

Heh.

This is the problem, you see. If you’re American, there are two mobile platforms that matter for you: Apple and Google. Both coincidentally operate from Silicon Valley. As is right and proper for any American technology. Everything else is irrelevant. The fact RIM could be viewed as ‘North American’ is irrelevant.

It’s Apple and Google.

Apple was the acknowledged winner. Google was viewed as a good egg. You know, doing well. Keeping things moving in the market and doing ‘good work abroad’. Which is a trillion miles away from anything relevant to the United States.

Until, that is, the Telegraph reports this:

The world’s biggest search engine will have about 38.9pc of the global market this year compared with 18.2pc for Apple, according to research firm IDC.

Panic stations!

Apple’s management is likely to be questioned on this issue on Tuesday when the company reports its results for the quarter that ended in June

You bet they will.

A wonderful $5.7 billion profit for the quarter to June will, I’m sure, silence most shareholders.

For the moment.

All these shareholders looking at iPhone will be thinking, “But I thought Apple was — like — the BEST mobile phone maker, ever?”

Yeah. No.

“How come Apple is just 18% compared to Google?”

The answer, of course, is a mix of price, logistics, marketing.

“So make some cheaper iPhones then to compete? Don’t LOSE the market, Apple.”

Yup.

This the fundamental problem. No amount of amazing profit announcements will quell the unsettling news that Apple is operating as a bit-player in the mobile marketplace. Especially when the other players — Google in particular — are so skilled at manipulating and working with the media.

550,000 activations per day, anybody? That’s what Google’s apparently doing right now with Android. The US market can’t help but compare this to Apple’s paltry figure (by comparison).

“Put that in your pipe and smoke that, Mr Jobs,” say the Android fans, “Where are your fancy minimalist slide decks now?”

If you assume 18.6 million iPhones shifted in the first quarter of 2011 (Cnet), split that by 90 days and you get 206,666 iPhones sold per day. Not a patch on Android. Not enough to quieten the nagging doubts of many an Apple shareholder.

It’s not just shareholders who matter, though. It’s the raft of analysts, advisors and market commentators who influence the wider industry. As far as they’re concerned, Android is conquering everything.

These kinds of news items from the mainstream media discussing Apple’s shoddy share-price (“worst first-half figures since 2008”) are precisely what Apple’s shareholders don’t want to see.

[It should be pointed out that by comparison, Apple’s share price performance is streets ahead of many of the other players out there!]

Bring on the Nano. Or, at least, let’s have some sizeable Apple movements in the next few quarters. The market could do with a bit of sizzle.