blue iPhone 5c blue background

Apple’s newly launched cheaper iPhone 5c model with eight gigabytes of storage is only available in select few markets, a spokesperson for the company confirmed Tuesday. The device is available in the United Kingdom, France, Germany, Australia and China. It is not, however, on sale in the United States, for the time being.

By comparison, the relaunched fourth-generation iPad with Retina display is available across all territories because that device is a replacement for the company’s phased-out iPad 2 and now represents the new entry-level, full-size iPad offering. The introduction of the entry-level 8GB iPhone 5c is largely viewed as an effort to help boost the device’s lagging sales…

Fortune’s Philip Elmer-DeWitt was able to confirm with Apple PR that the 8GB iPhone 5c only sells in the United Kingdom, France, Germany, Australia and China. The contract-free 8GB iPhone 5c is priced at £429 (about $711) in the United Kingdom versus the £469 (approximately $777) 16GB model.

A £40 difference, or about $66 in U.S. dollars, puts the 8GB model in the territory of the mid-tier handsets. Be that as it may, it’s unclear whether customers will opt for an iPhone with just eight gigabytes of storage where similarly priced Android handsets come with 16 or 32 gigabytes of internal storage.

iPhone model uptake in China

Even Apple’s boss Tim Cook had to admit that the iPhone 5c thus far has failed to meet the company’s internal expectations in regard to sales. Back in the U.S., the 16GB iPhone 5c will set you back $99 after a two-year contract, or $549 contract-free.

Most people have a hard time justifying that price point because plunking a $100 more gets them the current-generation iPhone 5s that runs Apple’s speedy 64-bit A7 processor with M7 motion coprocessor, an improved camera, Touch ID and more.

Cook said:

I think the iPhone 5s, people are really intrigued with Touch ID. It’s a major feature that has excited people. And I think that associated with the other things that are unique to the 5s, got the 5s to have a significant amount more attention and a higher mix of sales.

Limited distribution of the 8GB iPhone 5c makes sense if you consider that inexpensive Android handsets stole much of Apple’s share in key European territories and in emerging markets such as China.

As the chart above shows, the iPhone 5c has “bombed in China,” as TechAsia put it last week. That finding is based on app usage provided by the Umeng analytics network so it should be treated with a pinch of salt.

Specifically, the iPhone 5c has managed to capture only twelve percent of active iOS devices on Umeng’s network, meaning less than one in five iPhones sold in China is the iPhone 5c. Just don’t count on Apple releasing the official numbers as the company does not break down iPhone sales by model.

Despite the disappointing iPhone 5c numbers and Apple’s relatively low market share and unit sales compared to Android handsets, the company is by and large winning the revenue and profits game.

To this date, Apple has been able to take up an estimated 75 percent of the net profits earned by the big players in the handset industry – and this has been pretty much the case since 2008.


According to independent analyst Horace Dediu“that figure is consistent on an ongoing basis,” he adds, “having reached 60 percent as early as 2011 and remained in a band around that figure since.”

What’s your read of the iPhone 5c situation?

Did Apple misjudge demand for the device?

  • auci

    with such price, Apple should have long term plan for this product

  • Leonard Wong

    I still don’t really understand why Apple would do this. If they replace iPhone 4S with iPhone 5C 8GB, it will be a lot more logical.
    Probably just another smart marketing strategy.

    • leart

      Maybe your logic is right, but there are people like me that still prefer the 4s beautiful iconic design 🙂
      Ok the 5c is half second faster, not a big deal 🙂

  • Christian Mejía

    Why are they stingy if it costs $0.03 to make one gigabyte of storage.

    • cybersat

      They do not expect that all iPhone users as smart as you are. They try to make that $0.03 to $100.

  • Yujin

    8Gb minus the system will equal about 4gigs or less for everything else…hope they have good internet and unlimited..

  • Josh

    Just realised how stupid those price conversions are. A $700 phone in the UK is a $500 phone in the US?

  • blu

    I think Apple just missed the price mark for what people thought it should be. Everyone was expecting the 5c to be in the $300 range off contract. The device itself is fine, just not priced correctly. People feel that they took the iPhone 5, removed the metal case and then used plastic and charged the same. If Apple had left the 5 as the second price tier and then put the 5c as a 3rd (and gotten rid of the 4/4s) poeple would have no gripes (well they would, but that is human nature).
    My sister, her husband and my mom all got a 5c. They were actually about to get a 4s but then Best Buy had a sale on the 5c for free with 2 year contract (16 gb model), so they got that. Great price point for the phone IMO.

    As for the 8 gig model, it would work fine for many people. I have around 8 gigs free on my 16 gig iPhone 5 and am fine with it. The price is still too high IMO though.

    • Yes, you can get a new 5c with 16GB on ebay in germany for 439€ without contract. Nobody will buy the 8GB model for that price!

  • Laszlo Gaspar

    The price was and still is just too high for it to sell as a mid market phone, if they dropped the price by $100 it would probably outsell the 5S.