Internal Apple (AAPL) documents show the tech giant is worried, at least from the company’s sales team perspective, that the iPhone growth was diminishing amid growing competition from larger-screened, lower-priced Android phones, according to a document presented before a court Friday as part of the ongoing Apple vs. Samsung patent lawsuit (via Re/code).
“Competitors have drastically improved their hardware and in some cases their ecosystems,” a member of Apple’s sales team wrote, while expressing concerns that a shrinking high-end iPhone market would result in fewer customers for the tech giant’s flagship device.
The document, prepared for an offsite Apple sales meeting, went on to call out rivals’ “obscene” spending on advertising and carrier channel “to gain traction”. Samsung, Apple’s biggest rival, spent some $14 billion on advertising in 2013, more than tripling the roughly $4 billion it spent on marketing in 2012. That compares to Apple’s relatively modest $1 billion spent in 2013.
The document also noted that the shift in the market was accompanied by a rising Google (GOOGL) ecosystem, and that “mobile carriers had an interest in limiting iPhone sales because of, among other things, the high subsidies they had to pay on the device.”
Samsung presented the document during its cross-examination of Apple’s marketing chief Phil Schiller, who downplayed the document’s significance. According to Schiller, the document does not represent Apple’s official position and contained information that he largely disagreed with.
According to AppleInsider, Schiller does have solid statistical prove in terms of his argument’s objectivity. Apple’s iPhone 5s, with a 4-inch 1136 × 640 pixel IPS display and an off-contract price of more than $600, “has been the best-selling smartphone in the U.S. each month since its release.”
Shares of Apple fell $6.97, or 1.29%, to $531.82 Friday, reducing their 1-yr rally to 20.14%.