SAN FRANCISCO, Wed Sep 12, 2012 – The new iPhone 5 has to be more than just another smartphone as it carries the weight of Apple Inc.’s future on its slim frame.
Five years after the first iPhone upended the mobile industry, analysts say Apple is looking increasingly defensive as Samsung Electronics Co Ltd and other rivals have been first to market with phones that sport bigger screens or run on faster wireless networks.
Apple will try to close that gap on Wednesday with the unveiling of the newest iPhone, which is widely expected to offer 4G wireless technology for the first time, and a 4-inch display, up from the current 3.5 inches.
But it remains to be seen if CEO Tim Cook has any surprises up his sleeve, and if he will show off any technological breakthroughs that can put the iPhone 5 head and shoulders above the competition.
“They have been in the crosshairs of a lot of companies for a long, long time,” Sterne Agee analyst Shaw Wu said.
“They were the upstarts before,” he added. “Now they are more in a defensive role.”
Apple shares typically rally ahead of, and sell off after, a major product launch. They have gained 15 percent in the past six weeks to touch an all-time high on Monday.
Apple has grappled with competitive pressure since the first iPhone in 2007, though its rivals have changed as former market leaders such as Canada’s Research in Motion or Finland’s Nokia struggle, and as Asian powerhouse Samsung has come to the fore.
While no one company has yet been able to match Apple’s seamless integration of hardware and software, Google Inc’s Android has become the most-used mobile operating system in the world, and Samsung has the lead in device sales.
Wednesday’s iPhone 5 launch also comes days after Nokia unwrapped its first phone to run the latest Microsoft Windows software, intended to spearhead a new family of devices.
“It is getting tougher to expand the market share,” Gartner Research analyst Carolina Milanesi said.
The iPhone contributes half of Apple’s revenue and the majority of its profit, so Cook needs to dazzle both Wall Street and consumers. He is praised for having sustained Apple’s breakneck pace of growth since taking over last year, but the jury is still out on whether he has the innovation and marketing genius of the late Steve Jobs in the long run, analysts said.
Weekly options are implying about a 3 percent move for shares up or down between Monday and the close of trading Friday, a marginal fluctuation, said TD Ameritrade chief strategist J.J. Kinahan.
Even though few tech experts expect the new iPhone to mark a sea change in smartphone hardware technology, Wall Street analysts are still expecting Apple to sell 10 million to 12 million phones in September alone.