iPhone 5 Intro Ushers In Tidal Wave Of Access

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NEW YORK — In the lead up to Apple’s introduction of its latest iPhone, accessories companies were once again caught in limbo over the actual specs of the new device.

Without any real cooperation from Apple, many suppliers said they were forced to rely on rumors and speculation, a process that costs them money, time to market and supply-chain delays. But in the end, as Apple made its announcement, most were ready with product announcements of their own.

Indeed within hours of the iPhone 5’s introduction, more than 30 accessories suppliers announced cases for the new device. With the iPhone expected to account for $6 billion in sales of the $20.8 billion smartphone accessories market in 2012, according to ABI Research, grabbing just a small piece of the market can sustain a company for the year.

“There are over a billion [smartphones] shipped every single year, and every single one of them drives an accessory purchase,” Michael Morgan, senior analyst for mobile devices at ABI Research, said on the day of iPhone 5’s launch.

According to ABI, 75 percent of iPhones sold will have a case purchase attached at some point. Of all smartphone cases sold across brands, 38 percent are purchased at the same time as the phone, and 36 percent are purchased in the first three months.

“It’s a challenging business to be in. I can’t think of a more challenging one,” Sophie Swann, marketing/creative director for Cygnett, a supplier of smartphone cases and accessories, told TWICE at a briefing on the company’s iPhone 5 line. “We watched Apple’s announcement and immediately had our design team make adjustments to our anticipated designs. It’s a stressful process, but we were better prepared this time since we’ve gone through it before.”

Jeanne Hultquist, marketing VP for accessory maker Speck, said the company closely monitored the iPhone rumors and had its engineers make educated guesses on the plausible outcome. Much tweaking was done as the launch date approached, and then, “Boom, you pull the trigger and go with it,” she said.

Also stressing out accessories suppliers is Apple’s decision to abandon its 30-pin connector for the new eight-pin Lightning connector, which, on the surface, renders every previous accessory designed for Apple products obsolete. Though Apple is making a conversion cable available for $29, the decision rankled some consumers and suppliers alike.

One of Apple’s former official “evangelists,” Guy Kawasaki, said he was disappointed over the company’s decision to change the connection slots on the new iPhone 5, forcing customers to buy new cables.

“This connector thing, I think it’s pure arrogance,” Kawasaki told Britain’s Herald Sun. “They say, ‘We want to save space.’ Well, if the goal was really to save space, why didn’t you just go to a MicroUSB like everybody else in the world, and we could all get a cable at 7-11 for $5,” he said. “But no, you had to have a proprietary one. It fries my brain, I don’t understand it. It’s just arrogance, and I’m disappointed very much in that,” he said.

“There are millions of cables out there, and millions of docks out there, and every owner needs one for his briefcase, one for his home, one for his car, one for an office, so it’s four cables really,” Kawaski added.

In the end, the positives outweigh the negatives for accessories vendors, who are faced with sheer numbers that can’t be ignored. U.S. sales of the iPhone 5 could generate more than $3 billion for the economy by year’s end, according to economists and Wall Street analysts.

JPMorgan Chase analysts estimated earlier this month that about 8 million iPhone 5s would be sold in the U.S. through Dec. 31, enough to add a third of a percentage point to the economy’s annual growth rate in the fourth quarter. But after Apple CEO Tim Cook reported the company sold more than 5 million iPhone 5s in the device’s first three days of availability, up from more than 4 million iPhone 4S models sold last year in its first three days of availability, Chase’s estimate seems conservative.

Pictured on this page, as well as on p. 37, is a sampling of some of the new iPhone 5 accessories that shipped on or close to the official iPhone 5 launch date of Sept. 21. – Additional reporting by Lisa Johnston


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