Analysts cool on iPhone 4S as device fails to excite

Analysts have given a mixed reaction to the launch of Apple's iPhone 4S, noting that, although much of what was announced makes sense for the company, there is an underlying sense of disappointment with the device.

The iPhone 4S boasts a number of hardware upgrades, including improved processor, camera and battery life, as well as new voice assistant called Siri that can help schedule meetings, compose texts and carry out internet searches.

Charles Murray, from Analysys Mason, told V3 that, while the keynote was underwhelming, Apple's decision to focus on upgrading the internal hardware before any major design changes is a sensible move.

"The risk of a major upgrade to the hardware and a fundamental change in the OS was considered too much for Apple. They are mimicking Intel's hugely successful tick-tock strategy (major platform upgrade, followed by an incremental performance improvement)," he said.

"Thus the external hardware cycle is twice that of the internals, which is good for accessories. Also there is something about contract duration. A major new device every six months with people on 12- to 18-month contracts would start to annoy."

However, Murray said that Apple will have to ensure that the iPhone 5 is "something special" when it does arrive, as other competitors will continue to attack the firm's market share.

"By then Nokia/Windows Phone 7 may be a credible alternative, Motorola/Google will have hooked up, HTC and Samsung clearly aren't standing still and even Research in Motion (RIM) may have QNX-based devices. The competition is relentless," he said.

Apple also confirmed that pricing for the iPhone 4 will be reduced to $99 on two-year contracts, while the iPhone 3GS will now be free on contract, in a move that Francisco Jeronimo from IDC said could tempt people considering their first smartphone purchase.

"The new prices announced for the iPhone 4S and previous iPhone versions allow Apple to compete in the price segments where Android is fiercely growing: the mid-range," he said.

"Nokia and RIM should be the most threatened phone makers with Apple's announcements today. If price was an inhibitor for consumers to move from their Symbian or BlackBerry-based devices to the iPhone, now they have the change."