iPhone 5 orders cut by 50 percent

iPhone 5 sales have not met Apple expectations. Released in September last year, new 4-inch LTE capable iPhone 5 sells less than it should.

Orders of screens and iPhone 5 handsets had to be slashed in half due to slower than expected sales. Wall Street Journal thinks declines are not unusual and quite seasonal saying,

“our checks indicate that we are seeing only the usual seasonal decline in builds and the cuts reflect a component inventory build amidst some manufacturing limitations.”

iPhone 5 launch in China and elsewhere have been slower than expected as well. In fact Apple’s market share in China dipped from 2nd in 2011 to 6th at the end of 2012. Reasons given are lack of variety and premium costs. Studies show that over 40 percent of smartphone owners paid $200 or less for their handsets. Given that iPhone 5 costs much more, Chinese tend to opt out of Apple and prefer phones from ZTE, Huawei and other emerging phone makers.

Another reason for Cupertino losing its strong hold on smartphone market share in the world is Samsung’s popularity of their Galaxy and Note lineup. Android is the most popular OS covering over 72 percent of world’s smartphone and tablet operating systems. iOS now covers about 13.9 percent slipping from 15 percent year earlier. Apple holds about 14.6 percent world’s smartphone shipments, down from 23 percent in last quarter of 2011. Samsung ships about 31.3 percent of world’s phones, up from about 8.8 percent in Q3 2010.

Apple shares have fallen by 2.8% as a result.

Source: WSJ