Analysts Give iPhone, iPad Pro Thumbs-Up - Twice

Analysts Give iPhone, iPad Pro Thumbs-Up

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But Apple TV gets a big fat “Meh”

Analysts had positive things to say about the new iPhones and iPad Pro tablet but weren’t as impressed with the new Apple TV, which they said now matches the capabilities of other set-top streaming boxes at a higher price.

Though the iPhone 6sSand 6S Plus look like their predecessors and are priced the same, new features will give consumers enough reasons to upgrade their iPhones and maintain Apple’s iPhone momentum, analysts said.

The 12.9-inch iPad Pro signals Apple’s intent to reverse declining iPad sales, in large part through increased enterprise penetration with a tablet whose performance exceeds that of most laptops. As for the Apple TV, the first new model in three years is now competitive with other set-top streaming devices, though only Apple aficionados are likely to upgrade to the new device because of its price premium, some analysts said.

Here’s a sampling of analysts’ opinions:

iPhone 6S, 6S Plus

Forrester Research analyst Frank Gillett said he believes the new iPhones “have added enough new features to keep Apple on top of the smartphone heap.” 3D Touch and Taptic feedback “will reset the expectations of smartphone owners for how touch devices work,” he said. And with improved cameras and Live Photo, “Apple will have no trouble continuing its streak of smartphone leadership.”

Ian Fogg, IHS senior director of mobile and telecom, contended Apple “introduced many more innovations than it added with last years’ iPhone 6 and 6 Plus,” performing the “ultimate conjuring trick” by changing “everything about the iPhone” while making it look identical to the old model.

“The off years where Apple keeps the external look and feel unchanged have included some of the greatest iPhone innovations, despite the appearances to the contrary,” he said. Siri, for example, launched with the iPhone 4S, and Touch ID sensor and first smartphone 64-bit processor premiered on the iPhone 5S.

The 3D Touch improvements “will give existing iPhone owners an important reason to upgrade,” he said. And as app makers add 3D Touch, they will market the improvements to their apps, helping Apple “communicate the benefits of the iPhone 6S without Apple having to spend anything on advertising or marketing.”

The new models inherit extremely strong momentum from their almost year-old predecessors, which “continued to sell well even in a season which is normally the iPhone’s weakest,” he said.

Because of the “extensive improvements included in the iPhone 6S and the strong shipments of old models in the immediate prior quarter,” IHS forecast Apple will ship 236 million iPhones in 2015, up 23 percent year on year.

For his part, Ronald Gruia, Frost & Sullivan director of emerging telecoms, expects the new iPhones to generate as many replacement sales as did the previous-generation iPhones. Fourth-quarter iPhone sales in the U.S. will out-do the year-ago quarter because of these introductions, “based on the steady progress that Apple has made in increasing its penetration in the global $400-plus smartphone installed base from around 35 percent in 2011 to 52 percent in 2014,” he said. “This year, I believe Apple can reach the 55 to 60 percent mark. In the U.S., those figures are much higher.”

iPad Pro

Rhoda Alexander, IHS analyst, sees the Pro going head-to-head with full notebook PCs “in a move that echoes eerily of the original iPad launch, which targeted and quickly decimated the netbook market.”

Apple made it clear that the iPad is still its “vision of the future of personal computing,” she said. “It’s faster and more agile than the majority of notebooks offered by Apple’s competitors and boasts higher resolution than most of those products,” she noted.

Demand for tablets and the iPad in particular fell in the past year, with iPad shipments down year-over-year over the past six quarters, she noted. In 2016, however, she forecasts the iPad Pro “will help to drive a healthy uptick in the average price for iPads and a corresponding revenue kick” along with a return to unit growth.

One reason is that in targeting enterprises with the Pro, Apple will capture new business, not replace existing business. In addition, the larger iPad “is likely to generate fresh buzz for the iPad category overall, which will benefit all of the models and make users reassess whether they might perhaps be ready for an upgrade.”

Although Pro purchases “are likely to displace some of the traffic that would have historically gone to the 9.7-inch,” the 9.7-inch model becomes the mid-level iPad product, “a sensible choice for those who want the larger unit but are not yet ready or able to spend that much money.“

For his part, Strategy Analytics analyst Eric Smith point out that at a starting price of $799, the iPad Pro “is well-positioned to enjoy success in the growing large-screen tablet segment.” Tablets are “increasingly turning into a productivity device capable of competing for PC replacement dollars with two-in-one tablets and large-screen tablets,” he noted.

Apple TV

“The new Apple TV is an evolutionary, not revolutionary update,” said IHS senior analyst Paul Erickson, echoing other analysts. “While this is a significant step up for Apple TV from its last model iteration,” many of its new features are already available from competitors. TiVo and others have universal search; Roku, Fire TV, LG, Android TV, and others have voice search; and gaming is on other platforms as well, he pointed out.

The update “fails to change the game in the streaming video device market,” but it brings Apple “in line with the highly competitive status quo of this market.”

With a 50 percent to 100 percent premium in a market traditionally offering $50 to $99 products, Apple TV will appeal to the iOS user base, but for the non-iOS users and even for iOS device owners on a budget, “it will be a question of whether they feel that the gaming capabilities, apps, and perhaps the level of Siri’s intuitiveness … will be worth paying that premium.”

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