Will the iPhone 5S Have a Threesome?

iphone5. “We consider the iPhone 5 a work of art and Apple’s ability to deliver a device that came with a larger screen versus the 4S but one that was 18% thinner and 20% lighter was a monumental task,” wrote Brian White at Topeka Capital Markets following the release of the Samsung Galaxy S 4, drawing attention to just how important screen size is to analysts’ smartphone assessments. “By comparison, the Samsung Galaxy S 4 is 5 inches vs. 4.8 inches for the Galaxy S 3 but only 8% thinner and 2% lighter,” he added.

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White’s comments also serve as indication of the growing popularity of big-screened devices. A report by Flurry Analytics, which linked the popularity of a smartphone to its screen size, noted that devices with screen diagonals that fell between 3.5 and 4.9 inches were much more popular with smartphone users than their smaller-screened counterparts.

As larger phones — like Samsung’s (SSNLF.PK) Galaxy Note series –have begun to gain traction in the marketplace, there has be growing speculation that Apple (NASDAQ:AAPL) will increase the screen size of its upcoming iPhone models. Already, Apple has increased the screen size of its flagship smartphone from 3.5 inches to 4 inches with the release of the iPhone 5 last September…

Now, the Topeka analyst has predicted that Apple — faced by the growing popularity of big-screened phones — will release its next-generation iPhone with “at least” two different screen sizes. He wrote in a research note Tuesday, seen by AppleInsider, that there is even a possibility that the company’s so-called “iPhone 5S” will launch with three separate screen sizes.

“We believe Apple is coming around to the fact that one size per iPhone release does not work for everyone and offering consumers an option has the potential to expand the company’s market share,” he noted.

In addition to the differently-sized iPhones, which White believes are scheduled for June release, he also believes that Apple will debut a lower-priced smartphone that could capture a large segment of the market that the current iPhones do not serve. According to White, market watchers who expect Apple to price the device at $200 or even $150 will be disappointed as Apple would likely be unable to develop an iPhone priced below $300 without a contract subsidy. A price tag between $300 and $350 “makes more sense,” he wrote.

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“We believe this price point is reassuring for investors that Apple wants to expand its market reach with consumers in developing countries such as China,” he said. “However, the company will also manage its margin profile and brand accordingly.”

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