Early buyers go for iPhone 5S by more than 3 to 1

But the lower-priced iPhone 5C will turn the tables within a few months, predicts one analyst

Apple's flagship iPhone 5S outsold the less-expensive iPhone 5C by at least 3 to 1 in the U.S. over the opening weekend, a mobile analytics company claimed Monday.

Wall Street and industry analysts said that the ratio was probably even more in the iPhone 5S' favor.

According to Boston-based Localytics, a mobile and Web app marketing and analytics platform, the pricier iPhone 5S outsold the iPhone 5C by a factor of 3.4 to 1 in the U.S. Globally, the flagship outsold the iPhone 5C by a slightly wider margin of 3.7 to 1.

Localytics measured the ratio by mining data it received from clients' apps installed on approximately 20 million iPhones from Friday, Sept. 20 through Sunday, Sept. 22.

"Early adopters are favoring the high-end 5S compared to the 5C," said the company on its blog Monday. "This makes sense since those who feel the need to buy a new device the very weekend it launches are most likely the power users who want the highest-end phone experience."

While both smartphones were unveiled Sept. 10, Apple only offered online pre-orders for the lower-priced iPhone 5C, holding the iPhone 5S until Friday, when it took online orders starting at 12:01 a.m. PT and opened doors at its retail stores at 8 a.m. local time.

On Monday, Apple said it had sold more than 9 million iPhones -- including the iPhone 5S, iPhone 5C and the iPhone 4S, the latter retained from last year -- during the three-day opening weekend. That figure was 80% greater than in 2012 when Apple launched the iPhone 5, and set a sales record for the firm. Apple did not break out sales for each model, however.

If Localytics' data was an accurate mirror of the purchasing patterns, it would hint that there has been little cannibalization, at least thus far, of the iPhone 5S by the slightly-cheaper iPhone 5C. Some analysts explained Apple's pricing model -- the iPhone 5C came in at a much higher price than virtually every expert predicted -- as a defense against the new smartphone suppressing revenue.

sales of iPhone 5S chart
Mobile app analytics company Localytics estimated the iPhone 5S outsold the less expensive iPhone 5C by 3.4 to 1 in the U.S. over the opening weekend. (Image: Localytics.)

One Wall Street analyst pegged a larger disparity between the two new iPhones for in-store purchases.

"Based on our survey work of 126 buyers of the two new iPhones on Friday in New York City, 88% of respondents purchased the iPhone 5S and just 12% the iPhone 5C," said Brian White of Cantor Fitzgerald & Co. in a Monday note to clients.

White credited the overwhelming preference for the iPhone 5S to its unavailability prior to the weekend. "Since the iPhone 5C was available for pre-order on September 13 but the iPhone 5S was not, demand for the iPhone 5S should be much stronger than the iPhone 5C," he wrote [emphasis added].

The projected shortages of the iPhone 5S -- which quickly became reality online, and by Sunday morning had spread to Apple's retail chain -- may have also contributed to the rush for the flagship, as prospective buyers made a beeline to stores to grab one while the grabbing was good.

Apple's new gold-accented iPhone 5S sold out first, said White, while the silver model went next fastest. "The low quantities of gold and silver iPhone 5S stock received by the Apple retail stores may speak to greater difficulty in manufacturing these colors," White speculated.

But Sameer Singh, a mobile technology analyst who writes at Tech-Thoughts, believed the mix would flip to the lower-cost iPhone 5C in a matter of a few months. "Most consumers who wanted to buy a device on launch weekend were early adopters/enthusiasts," Singh said in an email interview. "The high-end model would have appealed to them."

Mainstream consumers, Singh said, would not rush to be first, but over time would drive sales of the iPhone 5C above that of the 5S.

Singh also noted the difficulty in estimating sales of the two phones, even though the anecdotal evidence leaned toward the iPhone 5S. "There's no real data to estimate the sales mix, comprised of direct sales to end users from Apple and sales to channel partners," said Singh. "This is complicated because of differing inventory patterns between the two models. The iPhone 5S is mostly sold out (similar to previous launches), but the iPhone 5C remains widely available."

Singh cited estimates by others who had pegged end user sales 2.6 to 1 in favor of the iPhone 5S, but who had also claimed Apple sold 3.5 million iPhone 5C smartphones to carrier partners, which were stocking up in the expectation that consumers would flock to the lower-priced model.

"But there's no way to confirm that," Singh pointed out.

Monday's numbers boosted Apple's share price by 5%, as the stock closed up $23.23 for the day, reaching $490.64, the highest closing price since Sept. 10, the day the company introduced the new iPhones.

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer, or subscribe to Gregg's RSS feed . His email address is gkeizer@ix.netcom.com.

Copyright © 2013 IDG Communications, Inc.

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