Less pricing change at Apple

According to an April 2013 presentation filed to a U.S. court, executives had debated plans for Apple's 2014 fiscal year and concluded that consumers wanted what it wasn't offering: cheaper phones - for less than $300 - and bigger screens.
It's unclear how representative that presentation is of Apple's mindset. Nor are there signs that Apple, which thrives on its premium positioning and plays down suggestions that it go mass-market, intends to deviate from its path.Apple did not respond to requests for ment.An 'economy' model may wedge Apple more firmly in emerging markets - a segment still seeing strong growth. Apple now relies on discounted older generation phones to reach cost-conscious buyers, but buyers in markets like Brazil and China increasingly want the latest gadget.

IPhone shipments grew just 8 percent in Apple's 2013 fiscal third quarter, a far cry from five years ago when shipments more than doubled."They are foregoing incremental revenue opportunities by not having a product that addresses that market," said BTIG analyst Walter Piecyk, adding that the main hope of investors now is that Apple produce a new product - a wearable device, say - to galvanize revenue growth.The shipboard chef says one major problem that he frequently encounters is rough seasThe iPhone 5C, a colorful plastic model priced just $100 cheaper than its premium cousin, was aimed at emerging markets and marked a departure from Apple's focus on premium phones last year. But it's not been a spectacular success. Some analysts theorize that an unwillingness to sacrifice profitability meant the device wasn't priced cheaply enough.

Apple's iPhone margins have crept south as the pany packs more features into its gadgets, trying to stand out in an increasingly crowded field. As its market share dwindles, the pany enjoys less leverage to squeeze suppliers. And margins may fall further if Apple introduces bigger screens as expected.
Bernstein Research analyst Toni Sacconaghi estimates that making the screen just 30 percent larger could wipe 4-5 percentage points off gross margins. IPhone margins are now in the mid-40 percent range, down from 50-60 percent a few years ago, analysts estimate."With the iPhone 6, Apple is likely to stick to premium pricing as it's widely expected to e with a bigger screen and some innovative design tweaks," said Doh Hyun-woo, an analyst at Mirae Asset Securities.