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(EMAILWIRE.COM, March 28, 2013 ) San Francisco, CA -- According to some analysts, the Apple iPhone's general dominance in the U.S. Is largely due to the carrier suppressing the market economics.
United States carriers artificially dampen demand for the lower-cost smartphones by disconnecting calling and data plans directly from the hardware. The result is that no matter what smartphone the customer chooses to buy, the total cost of the data plan is nearly the same, according to Sameer Singh, who is a employee of Tech-Thoughts.
In countries wherein contract plan prices fluctuate depending upon the smartphone's cost, Apple's share of the market is much weaker, according to Singh.
"The scale of the difference between the iPhone's presence in the U.S. versus Europe suggests that [data plan] pricing plays a significant role," said Singh in an email Tuesday.
In a new blog posted, Singh analysed the plan pricing in the United States, United Kingdom, and Australia. According to the Singh, ever since late 2011, which marked Apple's release of the less-expensive iPhone 3GS and iPhone 4 across the globe, the iPhone's share of the U.S. Market has maintained 10 to 15% higher than in the U.K. or Australia.
Singh attributed that the pricing structure of the U.S. Calling and data plans, as they do not gibe with the smartphone costs. The highest unsubsidized price of Apple, HTC, and Samsung were 71% more than the lowest priced model, the difference in the plan costs were 14% at the maximum.
"This gives high-end smartphones, including the iPhone, an unnaturally high share of the smartphone market," Singh said.
That's not the case in the U.K., whereas in other European countries -- competitive carriers more closely match the price of a two-year contract package to the price of the smartphone.
"The unsubsidized prices of devices are far more in sync with the relative contract pricing -- the contract [cost] of an $820 iPhone 5 is 91% higher than that of the $224 Samsung Galaxy Ace 2 -- which leads to a far more natural price-demand relationship," Singh said.
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