Research shows that consumers are buying more units of the iPhone 3GS and original iPad than newer devices based on Google's Android operating system.
Smartphones and tablets running Google’s Android operating system may be quickly taking over the mobile industry overall. But according to an industry analyst, previous-generation Apple devices often still outsell new Android units, like the HTC Inspire and the Motorola Atrix, reports Apple Insider.
A study of US mobile retail sales conducted by Canaccord Genuity technology analyst Michael Walkey found that Apple’s most recent smartphone, the iPhone 4, is “by far” the most-sold smartphone for both AT&T and Verizon, the only two wireless carriers that offer the popular device. But in the face of increase competition from devices that run on Android, Apple has found success in keeping the older iPhone 3GS on the market for a considerably lower price.
“Interestingly, our April checks indicated continued strong demand for the iPhone 3GS at AT&T and iPad 1 at Verizon, as these older generation products with reduced prices often outsold new Android products,” wrote Walkey in a note to investors on Monday. “We believe this highlights Apple’s significant competitive advantage, and these older products help Apple offer a tiered pricing strategy at key channels.”
One of the reasons for the success of Android, which now runs on a whopping 35 percent of all smartphones worldwide, is the availability of “budget” devices, which cost far less than a full-priced iPhone 4. But when confronted with the option to purchase an older-but-still-Apple iPhone 3GS for only $49 (with a two-year contract) on AT&T, the deal is too good for may to pass up.
The iPhone 3GS isn’t the only previous-gen device making Apple money. According to Walkey’s checks, both the 16GB and 32GB versions of the original iPad sold out within the first two weeks after the iPad 2 went on sale, most likely due to a drop in price for the first-gen tablet. Compare that to the “modest sales” of Android-based tablets, like the Motorola Xoom.
Some say consumers’ willingness to buy older iPhones further supports the theory that Apple could release a less expensive — but still new — model of the iPhone for greater push-back against the Android juggernaut. But when they already have exactly that in the form of their previous year’s device, why would Apple even bother?
Edit: Correction made at 12:45pm EST
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