Apple Inc. (AAPL) Can’t Ignore This Trend Forever

iPhablet incoming?
Barclays analyst Ben Reitzes was out recently suggesting that an “iPhablet” with a 5-inch display may be in store for the final quarter of this fiscal year (September quarter), or the beginning of next year. Introducing this device would help mitigate downward pressure on average selling prices that will accompany a lower-cost model.

In the meantime, Apple could fend off competitive threats by focusing heavily on improving its software and services. iOS 7 will be detailed within the next few months and could see a major shift in its interface design direction now that Scott Forstall is out and Jony Ive is in. Apple could also make a big splash into mobile payments since it now has over 500 million active iTunes accounts with credit cards on file.

Phablets are particularly popular in China, which Cook believes will become Apple’s biggest market. If Apple is to take the Chinese smartphone market seriously, a larger iPhone is a must.

The article Apple Can’t Ignore This Trend Forever originally appeared on Fool.com and is written by Evan Niu, CFA.

Fool contributor Evan Niu, CFA, owns shares of Apple. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple.

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