Analyst: Apple may settle with, not bar, Android phone makers over patents; will make a low-cost iPhone if it’s ‘killer’

“RBC Capital’s Mike Abramsky wrote up his findings from a meeting [Wednesday] with Apple’s COO Tim Cook, and CFO Peter Oppenheimer,” Tiernan Ray reports for Barron’s.

“Regarding a low-cost iPhone, Abramsky writes that ‘Apple’s primary criterion for launching a lower-end iPhone is an innovative, category-killer experience,'” Ray reports.

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“In its patent battles, Apple may settle with makers of Android-phones rather than seek to bar them, in order to set itself up with favorable agreements in countries such as China that have less rigorous intellectual property rules,” Ray reports. “Abramsky reiterates an Outperform rating on Apple shares and a $500 price target.”

Full article here.


  1. Maybe it’s just wishful thinking, maybe it’s just buying into rumours that are already out there, but wouldn’t you consider a 3G iPod Touch sold contract/carrier free for a little less than their current price (perhaps 199 or even 150 for the 8GB) an ” innovative, category-killer experience” ?

    1. There is absolutely no way an “iPod touch 3G” (which would essentially become an iPhone 4) can be sold for a quarter of a price of the actual iPhone 4. Currently, iPhone 4 costs $650 (when you don’t want to sign a contract). 3GS is not sold unlocked without contract in America; if it were, its price would likely be between $450 and $500. A phone with the features, hardware and function of an iPhone simply cannot retail for below $400, otherwise nobody in their sane mind would be paying $650 for an iPhone 4.

      So many people so often keep forgetting that two-year contract, along with the $450 subsidy that comes with it, and do all of their assumptions based on the down-payment price of the iPhone of $200.

      1. Apple is selling iPod Touches all day long for $229. This guy was proposing that they could drop the price to $199 or $150 on the iPod Touch, which now sells for $229. That is not unreasonable.

        Since we know Apple is selling these devices, and that prices drop over time, he is making a good point.

        Do you really think adding a 3D Cellular radio is going to add $400 to the price? If so, let me assure you, it doesn’t. Maybe $50 to the retail price, maybe much less these days.

        So, it is totally possible– from a cost viewpoint– to sell an “iPod Touch with 3g” (which has a lower quality camera than the iPhone 4, etc.) for around $199 without a contract.

        Whether this fits apple’s other plans or would cannibalize the phone sales too much is another matter.

  2. Interesting thought that last one. Because any potential ITC ruling only applies to the US, and relevant countries where similar action is taking place like Australia and a few European countries, the thinking has to be, does barring an Android mfrs handsets in a few countries help Apple more than licensing ALL a mfr.’s Android sales in ALL countries? I would think the latter would be more profitable by a wide margin, if as Apple is thinking, there’s a huge market to win in China, and it’s HIGHLY UNLIKELY for China to bar phones made by ZTE and Huawei, which both use Android. Better to collect a nice fat fee, fatter than anything Google is collecting from mobile search and fatter than anything Microsoft is collecting from Android infringement.

  3. Abramsky is a known RIM jobber so perhaps this makes sense for him in a perverse way hoping that Apple will vacuum up the crippled RIMjob along the way.

    How did the Pystar patent settlements turn out, you stupid nut?

  4. Yes, it so totally makes sense for Apple to spill their beans to Abramsky, before they may table a deal with the Android OEM lawyers, about their real objectives and motivations for patents infringements. I’m soo very convinced by this.

  5. Another shakedown by little Stevie “the cokehead” Jobs. There ain’t no patent infringements except in the foggy mind of Jobs and his rotted brain fanboys. So of course he wants to bark loud and then shake whatever pennies he can from the Droid tree. Problem is, in the end it may be Jobs and company who will have to shell out the moola because of all that they’ve copied from other platforms.

    1. Notice how the people who think these patents are worthless always seem to be the kind of people without the brains to have produced a genuine innovation themselves?

  6. This site should take advantage of the features WordPress has, such as “ignore”, “spam” and such. This would allow normal visitors to mark troll posts for removal/deletion, or at least to hide them, so that we don’t have to sift through obvious trolls in order to get to the real discussion.

    1. I agree. Modding into obscurity allows comment without time wasting. It could be done creatively…say text size reduction until it’s unreadable. Modding up might be a problem though – space allowing 😉

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