Smart Phones: Apple iPhone Flop an Opportunity for Competitors?

(Written by Alexander Crawford)

(Editor’s Note: This article was written before the sad news of Steve Jobs’ passing).

Apple’s (AAPL) unveiling of the new iPhone 4S, an improvement of the prior model but not an upgrade in hardware, left the market dissatisfied on Tuesday with competitors shares surging in global exchanges Wednesday as Apple stock fell. This begs the question, does Apple’s rare disappointment leave room for competitors to gain market share?

The iPhone 4S is identical in look and feel to the 15-month-old predecessor iPhone 4G, but its processor, camera, and software have been revamped. To a world that was excitedly anticipating a completely re-built iPhone 5, some believe the advancements of iPhone 4S have fallen short, offering a rare opportunity for competitors.

“Apple’s decision not to launch new hardware offers rivals Samsung and HTC a window of opportunity to narrow the gap with their high-end devices before the iPhone 5 arrives,” Ben Wood, head of research at mobile industry consultancy CCS Insight, toldĀ Reuters.

However, analysts also say that Apple’s decision to keep older iPhone models at significantly lower prices will help expand their reach into the mass market, setting up a more direct fight with competing phones that use Google’s Android software. The older iPhone 4G will now cost $99 with contract, and the iPhone 3GS will be free upon contract.

Apple also announced that Sprint Nextel Corp. (S) will now offer iPhones.

Do you think that Apple’s competitors will benefit from Apple’s misstep, or is it really a misstep at all? Here we list 5 companies involved in competing with Apple.

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1. Google Inc. (GOOG): Google’s Android software is used on many phones competing against the iPhone including Samsung Electronics Co.’s Galaxy S II and LG Electronics Inc.’s Thrill 4G. Market cap of $162.96B.

2. Microsoft Corporation (MSFT): Windows Phone platform, which only controls 2-3% of the market, was recently taken up by Nokia, which will introduce its first models using the software later this quarter. Market cap of $216.91B.

3. Motorola Solutions, Inc. (MSI): Maker of various Android-based smartphones including the Droid Bionic. Market cap of $14.73B.

4. Nokia Corporation (NOK): Maker of various smartphones, Nokia is planning to release phones using the Windows Phone Platform later this year. Market cap of $21.31B.

5. Research In Motion Limited (RIMM): Maker of the BlackBerry class of smartphones. Market cap of $12.37B.

Interactive Chart: Press Play to see how analyst ratings have changed for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.


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