In the past few days, there have been intense speculations on when Apple will announce the iPhone will bigger screen with Pacific Crest and ISI publishing notes. There are several reasons why Apple should start shipping larger screen iPhone as soon as possible.
First and foremost, Apple is losing sales to competitors offering smartphones with larger screens. Apple is losing customers especially those who are off contract and coming off contract or Android users who are off contract and those who are coming off contract. Apple is losing users customers now and it doesn't make sense for the Cupertino tech giant to wait for the iPhone 5 users.
Second, according to Forbes it is better not to have to manufacture for a huge spike in demand. Apple had to sequentially increase supply from the September to December quarter by 114 per cent, 77 per cent and 64 per cent units, respectively with the past three iPhones.
Basically, in this scenario, Apple's contract manufacturers have to staff up and run factories with overtimes and the possibility of ramping down the staffing levels, which might lead to higher costs for labour and shipping. As the Cupertino tech giant tries to get its lead-times down from weeks to days to 24 hours it creates additional costs like air shipping from Asia compared to having the units shipped via container ships.
Furthermore, manufacturers need to rush production of various parts that add to the product cost, which could be avoided if there wasn't as much spike in demand. Lower costs from manufacturing efficiencies will come into play on more units with smoother production schedule.
Lastly, less customer frustration will be achieved when getting the iPhone they want in a timely manner. Moreover, lead times for various models will come down faster and will also drive a bit higher app downloads and revenue.
There could be negative impacts like sales decline or not selling as much as the previous generation that might also negatively in the press and the Internet. However, there is still a great chance that the positives outweigh the negatives.