Apple's iPhone 5: The Chinatown factor

September 22, 2012: 4:23 PM ET

Why did one survey find 36% first-time iPhone buyers when a second saw half as many?

Click to enlarge.

FORTUNE -- Here's an odd discrepancy.

In a survey of 100 iPhone 5 buyers conducted outside New York City Apple Stores Friday, Topeka Capital found that 36% (the purple slice of the top pie chart at right) were purchasing their first iPhone -- suggesting that more one in three buyers were switching to an iPhone 5 from a competing smartphone or a plain vanilla feature phone.

Meanwhile, a survey of 517 iPhone 5 buyers conducted the same day in New York, Boston and Minneapolis by Piper Jaffray & Co. found only 17% first-time iPhone owners (bottom chart, purple slice), suggesting that there was a lot less switching going on.

Why the difference? My theory is that the New York City results were swollen by the ususually high percentage of first-day buyers in the iPhone 5 queue from the city's large Chinese population (see video of the line outside Apple' (AAPL) Fifth Avenue store here).

If the Chinatown connection works as it has in previous iPhone launches (seeĀ here), many of these Chinese buyers were so-called iPhone mules buying iPhone 5s for resale to scalpers a subway ride away and pocketing as much as $150 per phone for their trouble. The iPhones would then be packed into suitcases, shipped by air to Hong Kong, smuggled into mainland China, unlocked and sold on the gray marketĀ at an even steeper markup.

Boston has a relatively small Chinatown. Minneapolis' is even smaller. So it stands to reason that Piper Jaffray's surveyors would have run into fewer Asian iPhone resellers than the Topeka crew did.

Join the Conversation
About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

Email | @philiped | RSS
Current Issue
  • Give the gift of Fortune
  • Get the Fortune app
  • Subscribe
Powered by WordPress.com VIP.