Apple - What's Inside the Box for the Display?

Nick is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.

While Apple (NASDAQ: AAPL) had been declining from its all time high of $705.07, nearly 7.3% loss at the time of writing with $653.58, I believe AAPL still has great potential with its solid fundamentals and upcoming new products, iPad Mini and Apple TV.  Here, I'm trying to dig further into the shifting trend for the display size of Apple's new products in order to understand or reveal some hidden strategies deployed by Apple. 

According to the Wall Street Journal (see Apps Rush to Make Use of Bigger iPhone Screen Size) on September 13, 2012 by Jessica E. Vascellaro, "iPhone 5 will have 18% more digital real estate than previous models by extending the screen's diagonal length by half an inch to a total of four inches. This puts the iPhone 5 more in line with the industry." However, as Apple being the market leader and one of the most well-known innovators in the technology world, I do not believe Apple made this movement purely to catch up with the industry. So, I decided to research this further and tried to find out the challenges faced by smartphone makers and to see if size really matters.

When designing for mobile apps, the approach of using one module through responsive design to fit all screen sizes is not ideal. "For businesses, mobilizing is very important and requires a lot of thought and is not only about adjusting to the screen size, but also creating the right experience for the device and the platform", as stated by Oke Okaro, global head and general manager of mobile and connected devices at Bloomberg, New York (see Bloomberg exec: Mobilize, not miniaturize, when designing for mobile). The process of developing for mobile is far different and much more complicated than the Web. For example, while the Web is optimized for four browsers, such as Chrome, FireFox, IE, and Safari, there are 10-15 browsers for smartphones, each with its own limitations. Also, the usage of mobile for personal and business remains mixed, so the separation of functionalities is hard to achieve.

Furthermore, according to Bloomberg, a smaller version of the iPad tablet is anicipated to be released in October. In order to understand iPhone and iPad's display size as compared to other competitors better, the display size comparison is compiled below:

<table> <tbody> <tr> <td> </td> <td> <p>Display size</p> </td> <td> <p>Tablet</p> </td> </tr> <tr> <td> <p>Apple's iPhone 5</p> </td> <td> <p>4.0 inches</p> </td> <td> <p>New iPad: 9.7 inches; iPad Mini: 7.85 inches (unofficial)</p> </td> </tr> <tr> <td> <p><strong>Samsung's</strong> Galaxy S3</p> </td> <td> <p>4.3 inches</p> </td> <td> <p>Note 2: 5.5 inches</p> </td> </tr> <tr> <td> <p><strong>Nokia's</strong> Lumia 920</p> </td> <td> <p>4.5 inches</p> </td> <td> </td> </tr> <tr> <td> <p><strong>hTC's</strong> One X</p> </td> <td> <p>4.7 inches</p> </td> <td> <p>Flyer: 7 inches</p> </td> </tr> </tbody> </table>

According to some street suggestions and based on photos and dimensions released by Gotta Be Mobile's Shawn Ingram (see New iPad Mini Photos Leak), the new iPad Mini is expected to have 7.85 inches of display size. Based on the above data, my logical assumption is that all smartphone and tablet makers are trying to find the "golden size" for their product lines. For AAPL, increasing of iPhone 5's display size to 4.0 inches and the potential decreasing of iPad Mini's display size to 7.85 inches indicated that the range of display size is narrowing. Compared to Samsung's Galaxy S3 to Notes 2 of 4.3-5.5 inches and hTC's One X to Flyer of 4.7-7 inches, AAPL's iPhone 5 to iPad Mini of 4.0-7.85 inches is still wider despite being narrowed. Is it possible that Apple is trying to squeeze out the competitors by taking the widest possible range for the display sizes while still providing the best possible user experiences across different devices? If so, Apple is not catching up with the industry, but instead trying to eliminate all chances for other competitors to catch up.

Moreover, from users' perspective, a bigger screen size is not necessary better for smartphones as you can always choose bigger tablets; instead, comfortability, accessibility, and functionality should remain as primary concerns when deciding the display size.

So, ultimately, what is Apple trying to do with a bigger iPhone and smaller iPad, plus the upcoming Apple TV? It looks to me that Apple is trying to eat up all display sizes to create all-in-one, integrated visual experiences for Apple users. If Apple can clear these integration challenges, not only can it gain the market shares from TV makers, cable providers, content developers, and media, but also achieve the new dominance in multi-industry sectors. I strongly believe there is still much to be revealed as given by legendary Steve Jobs under Tim Cook's leadership and management. In short, size does matter and AAPL still has lots of potential.

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Fool blogger Nick Chiu does not own shares in any of the companies mentioned in this entry. The Motley Fool owns shares of Apple. Motley Fool newsletter services recommend Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.If you have questions about this post or the Fool’s blog network, click here for information.

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