Budget iPhone: is Apple really planning a cheapo version?

Jan 10, 2013

A cheap Apple phone is a 'terrible idea' that risks diluting the brand, warns one tech critic

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LAST year Apple broke with tradition when it reacted to market trends and launched the iPad Mini to take on competitors in the smaller tablet market. Now it is rumoured to be working on a budget iPhone in response to the success of its rivals.

Reports suggest that a less expensive version of the iPhone could launch later this year. With the spread of Android products and rivals like Samsung gaining ground in the global mobile market by catering to a range of budgets, some critics say it is high time that Apple makes the iPhone available to more people.

The Guardian describes the idea as “an attempt to push back against arch-rival Samsung and increase sales in Asia”.

Business Insider says it would be a "great move" for Apple but notes that it comes at least a year late. "The explosive growth in the smartphone market has now shifted to emerging markets like China and India," it says, "where there are few carrier subsidies and most people can't afford phones that cost $600."

By insisting on maintaining the premium prices of its phones, Apple has missed out on this growth in the past couple of years, it says.

The Atlantic echoes this point, saying that the biggest technology company in the world is in a position it rarely found itself in the last ten years under Steve Jobs – "playing catch-up in the race for market share".

Others disagree that Apple should be pursuing a cheaper market. "It’s a tempting proposition, but it would be a terrible idea," says Dave Thier at Forbes.

The big problem, he says, is that Apple already sells a cheaper iPhone – the iPhone 4s. In America, you can pick one up for $99, below the cheapest estimates for a 'budget' iPhone.

“So Apple building a new $100-$150 iPhone wouldn’t be Apple building a 'cheaper; iPhone so much as Apple building a 'worse' iPhone,” says Thier. "Diluting the iPhone brand would be too high a price for a product with such questionable benefits."

Meanwhile, Chris Maxcer at MacNewsWorld is having a hard time believing the rumours. He traces the reports back to Digitimes, which, he sniffs, "is somewhat notorious for spreading rumours that turn out to be dreadfully mistaken".
Maxcer says he’d like to see a cheaper iPhone, but to achieve it, not only does Apple CEO Tim Cook face manufacturing and marketing challenges, "he runs the risk of deviating from the most successful playbook in modern device history".

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