Apple low-cost iPhone speculation hots up

Apple low-cost iPhone speculation hots up

10 JAN 2013

Apple was again rumoured to be readying a low-end sibling for the iPhone, in order to boost its market share in price-sensitive emerging markets.

According to reports, Piper Jaffray analyst Gene Munster has said there is a “60 to 70 percent” probability the company will offer a lower-spec device alongside its existing flagship.

While Apple has been able to achieve a market leading position with its premium device, there has been concern in recent months that its growth is likely to suffer as its penetration among cash-rich customers reaches saturation.

By offering a cheaper device – it has been suggested it will feature a lower-quality screen, casing and processor – the company will be able to address a larger customer base, which is currently best-served by Android device makers.

Business Advisor said that Munster suggested a price point of $199, which is still a “significant discount” over the aging iPhone 4.

While the company is set to use cheaper components, the device is also likely to be lower-margin than the current iPhone line.

Earlier this week, Taiwanese publication DigiTimes – which has a somewhat uneven history in terms of its predictions – said that a “low cost version of the iPhone for China and other emerging markets” will be launched in the second half of 2013.

Perhaps surprisingly, this suggested that the device will feature a larger screen than the standard iPhone, and have a different external design from its siblings.

Separately, Reuters today reported that Tim Cook, Apple’s CEO, had met with Xi Guohua, chairman of China Mobile, to discuss a partnership.

To date, Apple has not offered an iPhone which supports the TD-SCDMA 3G technology used by the operator – which is the world’s largest by subscriber base.

The iPhone is available in China through China Unicom and China Telecom, which use WCDMA and CDMA network technologies for their 3G services.


Steve Costello

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