“Apple Inc. shares took a slight dip on Wednesday morning following reports that the company is considering a new, cheaper iPhone model that could broaden its appeal in the more price-sensitive international markets,” Dan Gallagher reports for MarketWatch.

“That points to the dilemma facing Apple: a cheaper iPhone would likely boost unit sales and market share in these key markets,” Gallagher writes, “but could also threaten the company’s margins, which are the highest by far among its peers and are largely driven by the iPhone and the high subsidies it receives from carriers.”

“‘As Samsung and Apple continue to fight for Smartphone market share, we believe a lower-end phone or ‘iPhone nano’ could be used to re-accelerate domestic growth and importantly give them a product to bolster emerging market growth,’ RBC analyst Amit Daryanani wrote in a note to clients on Wednesday,” Gallagher reports.

Read more in the full article here.

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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