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Early iPhone 15 Thoughts: We believe Q4 iPhone 15 success will come down to carrier promotions, and product innovations over the iPhone 12 series. Despite signs of promotional fatigue in 1H23, we believe the promotional environment will remain strong as AT&T is unlikely to increase exposure to T-Mobile's successful 2Q23 efforts to poach AT&T subscribers. Furthermore, T-Mobile's new Go5G plans will use upgrade promotions to drive subscribers into higher ARPU plans. Thus, Verizon will likely have to match AT&T and T-Mobile’s aggressive offers. Lastly, device innovation relative to the iPhone 12 appears robust, with iPhone 12 upgraders getting several user experience innovations, including a 48 MP vs. 12 MP camera with zoom and macro modes, always-on display, dynamic island, and emergency satellite SOS. With an easier y/y comparison due to the delayed iPhone 14 Plus last year and reducing economic uncertainty, iPhone 15 growth over the iPhone 14s appears possible. A Race to the Bottom: An OEM's success in postpaid now hinges on its ability to deliver a comprehensive device ecosystem. Given the significant development costs required to bring a successful ecosystem to postpaid, the opportunity for budget-oriented OEMs like TCL, NOK and OnePlus to grow seems to be ending. In a declining prepaid market with MOT and SAM taking ~70% of market share, budget-oriented OEMs find themselves vying for a shrinking segment. If this low-end weakness persists and carriers continue to rationalize the number of OEMs, proven brands like SAM and MOT and the WING ODM are well-positioned to benefit. By opting out of brand development and leveraging scale from MOT and SAM ODM business, WING has secured itself a stable foundation on which to weather the storm.

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