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Low-Cost iPhone to Use Plastic or Hybrid Plastic/Metal Design, Due in Late 2013
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To be fair, they did quite well with a similar strategy for iPods. First the flagship, then iPod Mini, Nano, Shuffle, Touch.
Always smaller and cheaper until the touch. Perhaps losing some on the margins, but establishing 70+% market share and iconic status (not buying an MP3 player, but an iPod. You see the same thing with tablets/iPad these days.)
It's not really a grab for more market share...
It's to sell a low-cost but still profitable product to more customers... customers they've never had access to.
Right now... Apple's phones start at $450. Admirable... but there are more potential customers (and more money from them) across the globe.
Oh... and Apple will still sell the normal expensive iPhones. It's possible to have a full range of products.
You realize Samsung sells some extremely cheap phones... and the Galaxy SIII, right?
Isn't making the iPad mini with a non retina display sacrificing quality for a bigger hold on market share
And that's why Apple will still sell the normal high-margin iPhone 5, 4S and 4.
This cheaper iPhone would be an additional model.
And let's be clear... Apple won't sell a $100 "burner" phone. It will just be somewhere south of $450...
The profit from a $300 phone could be around $150.... but Apple gets ZERO dollars if you don't buy an iPhone at all.
Some money from a consumer is better than no money.
It might put a dent into second-hand sales. Seems maybe Apple could be trying to cut into those. I mean, in the last few years I've gotten an 8GB 3GS for $60, (Summer 2011), 32GB 3GS for $130 (Spring 2012), 8GB 4 for $140 (Late summer 2012), all off contract and all from pawn shops. I mean, since Apple didn't see a penny from any of those purchases, I'd imagine they'd love some cash from people like me who can't (or won't) pay the current full retail price and aren't on a contract.
Isn't the whole point of Apple being that the initial high hardware cost outlay subsidies their software side? So Apple is going to continue supporting features like imessage, icloud and mail when they are earning less from each of these budget iphones, yet the consumers may well be using them just as much as the rest.
These are also the people (no offence) who are less likely to spend on app store and itunes content, so developers may not see much of a benefit here either.
These are also the people (no offence) who are less likely to spend on app store and itunes content, so developers may not see much of a benefit here either.
Market share is something that 3rd parties use to rank companies in an entire industry. It's very voyeuristic.
First place... third place... whatever. It's fun for us to sit back and see where our favorite companies rank on the chart.
But Apple is looking out for Apple... regardless of what the other guys are doing.
Apple's decisions are strategic... whatever improves their bottom line.
The iPad starts at $499 and goes all the way up to $829. But they also offer a $399 iPad too. Does that wreck their margins? Is the older iPad 2 the volume seller?
But the iPad Mini is a new model. Yes it's cheaper... but it's a different model.
Here's the kicker... ALL iPads are profitable. It doesn't matter which one you buy.
Clearly they crunched the numbers and decided it was a good idea to add the iPad Mini to their lineup.
The same could be true in phones as well.
The cost of a metal case vs plastic case is perhaps $1 or $2
Cutting down processor or screen specifications might save a few more.
The notion of a cheap iPhone misses a fundamental point. The selling price of an iPhone has very little to do with the cost of parts. It has everything to do with the mark up.
That mark up happens because that is what the market thinks an iPhone is worth. If Apple charged more or less for their phone they would make less money.
Apple could only make device that was cheap at retail, by slashing the perceived value-add of the the brand. And that would be commercial insanity.
In my view, a better move would be to launch an iPod touch with 3G. A non-phone. Sold without a number, without a contract and available in supermarkets and record stores and sold simply as a connected device, media player, games machine, social network tool.
(Oh, and you can actually talk to people if you really need to)
Such a device would not undermine the iPhone - and it really would make sense to keep the production costs to a minimum.
Cutting down processor or screen specifications might save a few more.
The notion of a cheap iPhone misses a fundamental point. The selling price of an iPhone has very little to do with the cost of parts. It has everything to do with the mark up.
That mark up happens because that is what the market thinks an iPhone is worth. If Apple charged more or less for their phone they would make less money.
Apple could only make device that was cheap at retail, by slashing the perceived value-add of the the brand. And that would be commercial insanity.
In my view, a better move would be to launch an iPod touch with 3G. A non-phone. Sold without a number, without a contract and available in supermarkets and record stores and sold simply as a connected device, media player, games machine, social network tool.
(Oh, and you can actually talk to people if you really need to)
Such a device would not undermine the iPhone - and it really would make sense to keep the production costs to a minimum.
True... but ad-supported apps could get a boost if there were 50 million additional iOS users someday.
Let's be honest... Android has 75% market share to Apple's 15%... yet developers still seem to prefer iOS.
Any increase iOS gets can only help developers.
My experience in Europe is that people like SIM unlocked phones. That way if they don't like a particular carrier they can easily change.
I was looking to get a 32GB iPhone off contract in Spain and it would cost 769 ($1025). That is a ridiculous amount to pay for a phone, especially one that has no NFC, no memory expansion and cannot be customised (apart from wallpaper).
In the end I got an android phone instead that has tones of features, is totally customisable and extremely fast.
Please show me this magical store where they give you iphones for free. Do they have macs too??
I already mentioned this in another post but at $49 for the 2GB model, the iPod shuffle is the most expensive MP3 player in its category.
Other 2GB MP3 players such as Philips SoundDot or SanDisk Sansa are in the $10-20 range and some of these even support video playback.
And how iPod shuffle has any significance in the big pictures like iPhone has right now?
What you say is true, but the average super car buyer might liken the LFA to the cheaper Toyotas. I wouldn't imagine a person buying Porsches, Aston Martins, Ferraris and Lamborghinis suddenly decide to look at the Japanese LFA.
I'm not too familiar with cars in that range, but that's what I'm thinking. I'm also not familiar with the sales numbers of the LFA, but my understanding is that it's not a very popular car at that range.
Hmmmm, if that's the kind of phone they're looking at, I might be interested in it, not because it's cheaper but because what I'd really love is a smaller and app crippled iPhone - I don't need all the apps and things that the iPhone can do, I really just need a dumb phone with a few other additions, like you say, contacts, calendar, perhaps camera (would be great if it had wifi and could be jailbroken so I could use it as a hotspot for my laptop and mini). I never web surf on the phone, I never watch videos on the phone, I never do a lot of what it's capable of, except text and call and sometimes snap a picture. That's a phone I've been wanting, but I'd prefer quality materials and I'll pay a little more than what is considered "cheap" to get it. Make it small like my old Motorola PEBL, call it an iPhone Nano and I'll definitely take one.
No we don't, we have a smaller version of the iPad. That's how Apple built it - to be smaller, not cheaper, so with this phone I'd bet they go the same route, not a cheaper phone, but a more basic phone (however one describes it). The fact these items are less expensive, doesn't mean their reason for being is to be cheaper, that's what other companies do, compete based on price so their phones' main features are "cheaper than xxx", with Apple, the main features of its products have nothing whatsoever to do with price, so expect this phone to be differentiated in a similar way (if it's true).
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It seems Apple is concerned about Samsung taking over the market Apple essentially rebooted (not created) with the iPhone. More and more people are considering Samsung over iPhone, which is bad in the long run. Hopefully, Nokia and RIM will more damage to Samsung's market share than Apple's....
For years I wondered why Apple doesn't take a chance and make a cheaper than mac mini, upgradable desktop - it would probably make quite a dent into PC/Windows market share, but they decided to do it more slowly (and in the meantime, PC market became an endangered species).
The problem is, people think of Samsung phones as "does everything iPhone does, but is much cheaper". And I don't think this idea comes from Galaxy S line but from cheaper Samsung/Android phones...
So, as non-Apple as it sounds, perhaps this time they should really try with a cheap iPhone, but of course it should be powerful enough to run iOS7 decently and at the same time be uninteresting for us who already own iPhones.
For years I wondered why Apple doesn't take a chance and make a cheaper than mac mini, upgradable desktop - it would probably make quite a dent into PC/Windows market share, but they decided to do it more slowly (and in the meantime, PC market became an endangered species).
The problem is, people think of Samsung phones as "does everything iPhone does, but is much cheaper". And I don't think this idea comes from Galaxy S line but from cheaper Samsung/Android phones...
So, as non-Apple as it sounds, perhaps this time they should really try with a cheap iPhone, but of course it should be powerful enough to run iOS7 decently and at the same time be uninteresting for us who already own iPhones.
Expensive for what it was, it wasn't 'cheap' by any means.
Still a damn good piece of equipment though!
Plastic alone isn't the problem. The iPhone 3 and 3G-S were plastic.
It's when they make it out of wafer thing plastic that just feels..... cheap.
So what ? It's still a low cost option for those wanting to get an Apple device for MP3 playback. A lot of Apple's success in the PMP market was due to Apple releasing the iPod Mini, Nano and Shuffles. The Classic wasn't that big of a seller compared to these less expensive models.
And frankly, I don't get what you people don't understand about these rumors. A low cost iPhone does not mean a cheap iPhone. It means an "iPhone Nano/Mini/Shuffle" type product, a low cost alternative to the regular iPhone, but that is a quality product with decent margins for Apple.
Plastic, if it is used, does not sacrifice "build quality". Aluminum and glass don't garantee "Build quality" either. That's just a ludicrously snob line thrown around Apple Internet forums. Is your Apple TV "Cheap" and "shoddy" as far as build quality goes ? Is your Time Capsule "plasticky" ? Is your power adapter for your MacBook "flimsy" ?
Frankly, the "plastic" hate is just the new form of snobbery. I tend to dismiss the "plastic haters" outright because they still think of Apple as some kind of exclusive brand, a "BMW". Sorry, you don't get 30% of the smartphone market as a BMW, you're just another one of the mass market buys at that point. Apple is the Honda to Samsung's Toyota and Motorola's Nissan.
Would you prefer Apple maintain a 'good profit margin' on the iPhone while market-share drops below 10% worldwide like the Mac?
I agree that the answer isn't to make cheap rubbish that would only devalue the Apple brand. But I think they should sacrifice some of those very good profit margins for the sake of being more competitive on price.
In Italy actually we have a plan for 8/month (about $10) with unlimited Internet 120 mins of calls and 120 SMS. And it's perfect if you have an used (non-contract) iPhone, especially for young people.