“Apple Inc. is working on a lower-end iPhone, according to people briefed on the matter, a big shift in its corporate strategy as its supremacy in smartphones has slipped,” Jessica E. Lessin reports for The Wall Street Journal.
“The cheaper phone could resemble the standard iPhone, with a different, less-expensive body, one of the people said,” Lessin reports. “One possibility Apple has considered is lowering the cost of the device by using a different shell made of polycarbonate plastic; in contrast, the iPhone 5 currently has an aluminum housing. Many other parts could remain the same or be recycled from older iPhone models. Apple could decide not to move forward with the device.”
Lessin reports, “Apple has been considering a less-expensive iPhone since at least 2009 to grab market share and hook people on the brand, said people familiar with the efforts… Gene Munster, an analyst with Piper Jaffray, said that a less expensive iPhone won’t necessarily hurt Apple’s overall profit margin if it attracts buyers who haven’t bought iPhones before and not those who would have been willing to purchase the higher-end device.”
Read more in the full article here.
[Thanks to MacDailyNews Reader “Jax44” for the heads up.]
Related articles:
Apple to launch low-cost iPhone with 5-inch display for emerging markets in 2H13, sources say – January 8, 2013
Barclays: Cheaper iPhone for emerging markets ‘key’ for Apple – December 4, 2012
Cheaper than a free iPhone 4? Hmm
Pre-paid, dumbass. No subsidies. Ram it through your blockhead.
Nick made a perfectly valid point. What’s with the belligerent attitude?! Take it somewhere else!!!
Nick is clueless on this point. I agree that the rough language was not necessary but Emerging markets is right.
Apple doesn’t care about cheap products or emerging markets. They care about high quality products and high margin profits.
Maybe in the past. But they do care about the emerging market going forward. How could they not? Margins will have to come down for Apple products someday. You don’t have to make a lot on every product that you produce. But those products help you keep your foot in the door. That is what is important. Can you say China and India? So can Apple.
Nothing in Apple’s history since Steve Jobs return in 1997 supports this..
Everything product Apple makes is of high quality, and extremely high margin, regardless of market share.
Based on that philosophy they’ve become the largest company in the world. i don’t see that changing anytime soon.
@ weekend
In fact, iPad mini at $329 is a perfect example of the high quality, high profit margin mentality at Apple.
Well, why don’t we iCal your comment? I say they will make a lower-priced entry-level phone. You say they won’t. We’ll see in six months who’s right.
The article above says nothing about prepaid or about emerging markets. So not sure what all the hostility is about.
The article above said Appple was considering making a low cost iphone to “hook people on the brand”. I was just pointing out that Apple is currently doing that with a free ( yes I know subsidized) iphone 4.
iPhone 4 without a contract, a phone two generations old, costs $450 to buy unlocked.
Carriers in emerging markets generally don’t subsidize phones.
Another stupid rumor.. Unless it is not a smart phone?
Look at the source: Gene Munster, big fan boy terrible track record.
“according to people briefed on the matter” I believe DigiTimes started this rumor and now they become a inside source. There is no journalism left in the world.
And they won’t make a smaller mini iPad either right?
makes zero sense. And Jessica is a liar. OR her “people” are. The fabled “people” who she blindly listens too. Or made up, more likely.
Iphone supremacy has slipped? By what metric, Jessica?
It’d be awesome to see a group put together class action lawsuits on analysts and financial journalists who give out false rumors.
Again, Apple already had cheap plastic-case iPhone — it stopped selling it just few months ago; it was iPhone 3Gs.
Of course, this does not prohibit to Apple to develop new cheaper iPhone. But this going to be really serious change of strategy, if it will happen.
They need a $150 phonr for China, India, etc. It won’t affect their strategy in the EU and US.
The Wall Street Urinal. Expect less
When they do it, all the naysayers will proclaim it a stroke of genius. It’s the iPad Mini all over again.
1
Nice. Now all Apple has to do is reverse engineer the plastic encrusted Samsung Galaxy S3 and voila! A cheaper iPhone.
“according to people briefed on the matter”
Yes, Apple invited people to share in their product roadmap. Showed them their innermost secrets. You know, just because.
HAHAHAHAHAHAHAHahahahahahah!!!
Nah. See, I met this guy in an upscale bar on Pagemill and he said he was with Apple and he had this new prototype iPhone he was testing…so I decided to use this as the basis for the article in the WSJ.
And some people who were full of shit needed to fill some space i instead od doing journalism said this in a paper which historically only printed facts.
Another fine example of analysts reading their own garbage.
Meanwhile, Microsoft is stemming the low-cost tide from Apple by introducing an iPhone alternative called….
The PhonÆ
Apple will NEVER release an iPhone on Verizon’s network!
…wait…
Apple does have cheaper iPhones right now. iP4, iP4s and refurbished phones. Apple does not race for the bottom.
Hasn’t Gene been fired yet? Are these the same sources that told him an Apple TV would be released last year. Hey Gene! As soon as your name is mentioned in an article we know its bogus.
Heck, the fancy casings I can live without. My loyalty is not so superficial. If they can offer the same iPhone in a less expensive case, I think me and the majority of consumers would take that one instead. Not just developing countries. Especially if it is also offer with a 5″ screen.
How much would a cheaper case save you, $5 or $10 perhaps?
Then the next article will be about how the cheaper iphone will cannibalize the big iphone and bring margins down .5%. But Amazon makes new highs with almost no margins.
Most of the cheap competitors Apple would be against run old processors, and old OS, non-retina display to get that price. So basically resurrect the 3gs with a bigger display and cheaper case. Woohoo!
In other news Apple will be launching a smaller cheaper laptop to compete with the successful netbooks and low price laptops taking a large percentage of the market.
Repeat, Apple doesn’t care about cheap products or emerging markets, or market share. . They care about high quality products and high profit margins.
#Bullshitrumor
It’s not the cost of the iPhone, it’s the cost of the mobile service plans. In Europe, they pay less than HALF of what the Americans do and have download rates over 4 times faster. Why? Easy. They allow open competition. This is true for land-based internet, too. There (and Australia) they have the unlimited usage, screamingly fast, true 4G not this regurgitated 3G garbage relabeled as 4GLTE. US products (such as the iPad) are not allowed to display “4Glte” due to it being false advertising. Europe has left the US completely in the dust in terms of digital communications. It will stay that way as long as the corporate-owned Congress keeps corporations in control of the FCC, too. Does a rural American, being forced to use dial-up, qualify for third world status when applying for British citizenship?
*This*.
Cell phone plans where I live are three year affairs and when taxes etc are in with a passable amount of data you’re looking at $75/month. And the phone’s still $200. They could give me a damn phone but it still means my phone ends up costing me about $3,000 all in.
I want no contracts, at least a GB of data, and a monthly service of $20/month with 200 minutes of talk. Then I’ll get an iPhone for my wife and I to share. It’s not Apple’s fault, it’s the carriers and the CRTCs fault.
Until then, I have to stick with a hand-me-down smartphone that I put a $100 pre-paid SIM in and no data that’ll last us 18 months before the funds run out.
every single morning we wake up with new stupidity born in so called stupid analysts brains during the night.
what these guys are smokin’?
That’s become scarry and crazy.
I keep blowing hot and cold on this one.
Hot: cheaper, basic functions, less well spec’d phone for emerging markets. $200 would be about right.
Cold: iPhone 4 & 4S…upfront design, manufacturing and distribution costs are now amorticised which significantly reduces overall subsidy costs for developing markets so why incur ‘extra’ expense to make another phone with less profit. A cheaper less capable phone would undermine the perceived value of the Apple brand and a step backwards in capability would do the same.
I think a totally new form factor/device is more likely on balance.
No. 1: the story comes from a woman so it’s useless to me. No. 2: obviously the rags don’t care about validated information any more so its useless to me. No. 3: it’s just plain stupid . SEE NUMBER ONE!