The launch of the Apple iPhone 5 "will be the biggest handset launch in history," Jefferies analyst Peter Misek wrote in an Aug. 17 research note. The note also offered color on the state of a rumored iPad Mini and Apple iTV.
Jefferies has determined that 170 million global smartphone subscribers will be coming out of contracts in the second half of 2012, and 450 million more will be contract-free in 2013. Further, the firm believes that approximately 30 million iPhone subscribers will complete their contracts in the second half of 2012 and approximately 85 million will do the same in 2013.
"We therefore see significant and very fertile ground for the iPhone 5's success," wrote Mistek.
Apple's iPhone is due for a refresh-the iPhone 4S debuted in October 2011-and Apple is widely expected to introduce a new smartphone at a Sept. 12 event. Consumer anticipation for the device was partially blamed for a quarter-to-quarter drop in iPhone sales at Verizon Wireless and AT&T during the second quarter, as well as Apple earnings that failed to meet Wall Street expectations-an occurrence that has happened only twice in 39 quarters.
Jefferies expects Apple to have approximately 15 million iPhone 5 handsets in inventory by mid-September, and for the Sept. 12 event to include "an announcement of the iPhone 5, possibly of the iPad Mini and less likely of the iTV."
Since the start of the year, analysts have been anticipating a smaller iPad, now dubbed the Mini, in time for holiday sales. It's expected to feature a 7.85-inch display, which would make it somewhat of a thing apart from the true 7-inch form factor that Apple co-founder Steve Jobs, who passed away last year, so vehemently opposed. It would also address a market that consumers have made clear that they like.
Google recently launched a 7-inch tablet, the Nexus 7; Samsung offers its Galaxy Tab in 7- and 8.9-inch models, and has sold more than 10 million of its 5.3-inch Galaxy Note "phablets."
A smaller iPad would also "unlock demand in Asia," wrote Misek, where both businesses and consumers want a smaller form factor at a lower price.
Less certain is the timing of an Apple TV, or iTV, another rumored device that has been confirmed by the market but unacknowledged by Apple. Piper Jaffray analyst Gene Munster has called the device's release not a matter of "if" but "when."
"While we think an iTV will be ready for a [fourth-quarter] launch, we do not know how many major product announcements Apple would want to cram into Sept./Oct./Nov. and see a [first-quarter 2013] launch as possible," wrote Misek.
Munster has also predicted an early-2013 iTV-as well as forecast that the device will change the way people consume television content.
A 2013 launch would also help to break up the lull in Apple releases until the next iPad and iPhone refresh.
Samsung has reaped the benefits of Apple's most recent downtime, launching its Galaxy S III in May, bringing it to the United States in June and enjoying strong summer sales. By July, it had sold more than 10 million of the phones, advancing Samsung's lead as the world's top-selling phone and smartphone maker. During the second quarter, more than 50 percent of the 90.4 million phones Samsung shipped were smartphones.
Still, Jefferies sees the economic benefits of the advancing markets going to Apple.
"We believe Apple's product leadership, vertical integration and vast scale mean that it will receive the lion's share of the economic benefit from the three biggest multi-year trends in technology," wrote Misek, "smartphones, 4G and tablets."