Has iPhone 5 Demand Fallen? One Reason Why There Isn’t An iPhone 5 Supply Shortage

A recent article on CNN gave us the exciting news that the holiday shoppers won’t need to worry about not being able to buy an iPhone 5 because apparently there are ample supplies of the latest iPhone in stores.  This means the most likely scenario is anyone could walk into an Apple store right now and walk out with a new iPhone 5.

Sounds exciting right?

I think so… but from an analysis stand point, I couldn’t help but ask myself, “why is it that the iPhone 5 is in such great supply at stores?”  When I asked myself this question, of course my immediate response was that there simply isn’t as much demand for the iPhone 5 as there was for previous iPhone models.  But based on my experience, and based on the numbers, that’s only one perspective – or one interpretation of a much bigger story that’s going on here.

For one thing, when the iPhone 5 came out, AT&T dropped the price of their iPhone 3GS all the way down to $.99 cents (2 year contract required).  I immediately went to my local AT&T and picked up a new iPhone 3GS – not a bad way to spend $.99 cents.  The problem with that decision, for Apple anyway, is that I didn’t chose to buy an iPhone 5.  That left one more iPhone 5 on the shelf that otherwise, if the iPhone 3GS wasn’t available for $.99 cents, wouldn’t be there.  Now multiply that affect by all the deals running on the iPhone 4 and iPhone 4s and you now have an entirely different iPhone market competing against the newest edition to the family – the iPhone 5.

Even though 5 million units of the iPhone 5 (that’s a bit ironic, huh?) sold on the first weekend it was released, which topped all previous iPhone release weekend sales, that demand has been mitigated by the all the other iPhone’s on the market, and especially the previous iPhone models that are being sold – brand new – for only $.99 cents.

I can’t say for sure whether or not demand for the iPhone 5 has fallen, comparatively that is.  But I think one thing’s for sure – the iPhone market that’s made up of the iPhone 3GS, iPhone 4, and iPhone 4s have definitely taken their toll on sales and demand for the new iPhone 5.  And it’s because of this competition from previous iPhone models that I believe we are seeing ample supply of iPhone 5’s on the shelves.

What do you think?

Are previous iPhone models stealing some of the demand for the iPhone 5, or has Apple just gotten a lot better at their logistical infrastructure?

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