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Display Search: Why iPhone 5c Isn’t Doing Well

Santa Clara, Calif. — Apple has cut back iPhone 5c orders by 35 percent and boosted iPhone 5s production by 75 percent, Display Search said after checking supply channels.

Display Search analysts Tina Teng and Shawn Lee attributed the 5c’s disappointing performance to two factors. First, media and analyst speculation that the 5c would be a low-cost phone disappointed consumers looking for a cheap iPhone, they said.

“The fact that the iPhone 5c is nearly identical to the iPhone 5 — and is not cheap — disappointed some consumers,” they said in a blog post. The market’s expectation of what the iPhone 5c would be was very different from how Apple wants to position itself,” they noted. “It was not Apple’s intention to develop a product targeting the “low-cost” smartphone segment.”

Second, the iPhone 5c launched in China during Golden Week, the first week in October, when Chinese carriers were aggressively gaining new subscribers through device subsidies, they said. The carriers, however, didn’t allocate higher subsidies on the 5c compared to other brands, deflating sales expectations because the 5c was not priced at a much lower price as the market expected.

In the U.S., retailers have been cutting prices of the 5c, and Verizon Wireless reported 5s supply constraints at the end of September.