Apple's Problem With iPhone Numbers

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For Apple ( AAPL ), every iteration of the iPhone is a big deal. Unlike Android's ( GOOG ) launches, which are down to almost a weekly affair, Cupertino prefers to keep its smartphone updates on a yearly basis. And while Apple's annual soiree never fails to generate fevered excitement and leagues of speculation, this year's iPhone release is its most important since the very first 2007 launch .

There's no question that Android and its many partners have become much more than a thorn in the side of the iPhone maker, with Samsung's ( SSNLF ) eye-popping sales and reach leading the pack. Along with newcomers like LG's (KRX:066570) Nexus 4 and the HTC One (TPE:2498), the Galaxy S line and Android as a whole has pushed the envelope as to what consumers expect in a post-iPhone world and has challenged -- and surpassed, in many areas -- Apple in terms of style, features, and build quality. And even as they struggle to stay in the game, BlackBerry ( BBRY ) and Windows ( MSFT ) Phones have shown a willingness to innovate and try something new, which in turn has made the iPhone and its long familiar grid of icons appear staid and stodgy in comparison.

So naturally, when the iPhone is no longer the number-one choice for a hefty portion of consumers, the pressure is on to deliver a device that will blow away its rivals. And as a former Apple executive puts it, this is no time for an iPhone 5S .

Ken Segall, Apple's former marketing guru -- he famously put the "i" in iMac and had the company "Thinking Different" -- knows a thing or two about stoking a consumer's curiosity. Recently, he railed against the company's decision to introduce the off-year "S" names to its annual iPhone updates.

"[T]acking an S onto the existing model number sends a rather weak message. It says that this is our 'off-year' product, with only modest improvements," Segall writes. "If holding off on the big number change achieved some great result, I might think otherwise. But look what happened with iPhone 5."

Segall explains that despite the bigger screen, LTE support with Verizon (VZ), better camera, and faster speeds, the iPhone 5 was still viewed as a middling update to the iPhone 4S -- all because of the seemingly "half update."

"[P]ersonally," Segall laments, "I wish Apple never created a 4S."

Indeed, in keeping a previous year's wholly arbitrary number, Apple has suggested that it has upgraded the iPhone with a very light touch -- at a time when manufacturers are scrambling to introduce as many new whiz-bang features as possible into their increasingly hi-tech smartphones. Segall argues that the 4S could've easily been the iPhone 5, and no one would've thought anything of it. Why Apple would ever hint at modest updates is a mystery, but the iPhone numbering structure might not be an issue for much longer.

Take a look at Apple's other leading device: the iPad. Upon the release of its third-generation iPad, the company dropped its numbering structure altogether. Instead, it was dubbed "The New iPad." And when the fourth incarnation was released later that year, it was the "iPad with Retina Display."

No number. No qualifying letter. Just iPad.

The simplified name placed the tablet into the same league as Apple's MacBook and iMac line. Customers don't need a number after Apple's laptop or desktop computers, and given the many options in display and peripherals, a number scheme would be largely moot. This might hint at a new iPhone without any numbers after its name, especially if rumors of new low-cost iPhones come to fruition.

Traveling six miles north of Cupertino to Android HQ, there's no hard and fast rule on numbering devices. Samsung may keep adding Roman numerals to its flagship Galaxy S line, but a full list of its other smartphones shows that, uh, yeah, numbers aren't going to help. But Apple, with its single line of smartphones, can deviate from a numbering structure without it getting overwhelming or confusing.

It's unlikely the iPhone's number scheme will carry it all the way to iPhone 12 or iPhone 19. At some point, Apple has to drop the numerical system and just say, "This is the New iPhone." And from the looks of the iPad, it could very well happen soon.

But when it does happen, analysts and consumers will be able to judge a new iPhone by the content of its features and not by the letters in its name.

Also see:

The PC Market May Be Dying, But Apple Is Still Minting Money In It

The PC Isn't Dead, It's Just Gone 'Ultramobile'

After Apple, China Directs Its Ire at Microsoft

Disclosure: Minyanville Studios, a division of Minyanville Media, has a business relationship with BlackBerry.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Technology

Referenced Stocks: AAPL , BBRY , GOOG , MSFT , SSNLF

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