iPhone nano rumor update

[jmpage2]

What phones are sold at full subsidy without a contract? I call BS on that. They might be subsidized but not the same extent.

You can't compare iPods and the iPhone. Completely different business model. The latter has to take into consideration the needs of the carrier (the iPhone was actually developed with AT&T, which means they have a degree of control over the product not seen in any other facet of Apple's line). Anyway, the point is that phones cost more without a subsidy (as provided on the bases of you agreeing to sign up for a contract).

It's really quite simple. You don't get a subsidy unless it involves a contract - and unless you can provide any proof of what you said above that's how it is 100% of the time. If the iPhone is sold without a contract it won't be subsidized to the same degree it is now (and it might even be full price). In either case it would cost more than it does now (to get the phone). Moreover, making a smaller iPhone would cost more in it self, because new technologies would have to be developed or employed, which only further disproves the likelihood of a "cheaper" iPhone nano. In the world of technology smaller always equals more expensive (at least initially).

Anyway, there won't be a nano or any iPhone update for a while (as is confirmed by the revelations surrounding Macworld).

For one thing you are way off target. Many phones are subsidized to the same extent as the iPhone and not all of them are smart phones. The Moto Razr was sold only 18 months ago with full $200 subsidy. All of the other smart phones are sold with the same subsidy as the iPhone.

Your comment about AT&T having input on iPhone is also completely off base. It's well publicized that in fact Apple told AT&T what they would be getting. This is obvious since the iPhone is the only phone that AT&T sells that isn't co-branded and doesn't have custom applications, etc, that tie the handset to their brand.

Apple basically told AT&T, "here's our iPhone, it will be the best selling phone ever, you will get lots of new subscribers, take it or leave it".

I don't believe for one minute that AT&T had anything to do with iPhone development beyond network/performance testing as the handset and firmware were being developed.

In any event, we will know if these rumors are true soon enough. I personally do expect a new form factor iPhone by July of 2009 at the latest, whether it be a nano iPhone, flip iPhone, iPhone clam shell, etc.

 

[Demosthenes X]

The iPhone will just keep getting cheaper (and more colourful) as a way to attract more customers. I mean, sure, an iPhone Nano could maybe happen - I just doubt it.

The problem with the iPhone is the price of the contract. Yeah, the phone itself is cheap, but the contract is ~$100/month - that's a lot of coin. An iPhone Nano would target the crowd that wants a convergence device (phone + iPod) and doesn't want a $100/month commitment. That's a different market (although, I admit, some iPhone users might leave for the Nano).

The AT&T unlimited data plan is $30/month. So how is that worse than what you have in Canada? Sounds a heck of a lot better to me.

Rogers did offer 6GB/$30 to start. But unless you're streaming music or using YouTube every day, you won't use anywhere near 6GB - people I've talked to are using more like 200-1000MB.

The Rogers "tiered" plans are overpriced, but the approach is right: you pay for the data you use. So instead of being locked into paying $30 for 6GB, you could be paying $10 for 500 MB, and if you happen to use 1.5 GB one month you could pay $20 for that one month. That's a better pricing theory than paying for 6GB every month, even if you only use 500 MB. That would be like paying for unlimited minutes even though you only use 200 minutes a month.

But yes, right now, data on Rogers is badly overpriced.

Also if you have wifi 90% of the time, you need to leave your cubicle more. You have wifi in your car, in the movie theater, in church, at your kids soccer game, at the football game, in a restaurant, at the beach, or any of 1000 other places where there is no wifi?

I'm in university, so 90% of my time is spent at home or on campus. Both have full WiFi coverage. The other 10% of the time, I have little need for data coverage. I might use it if I had it, but there's not enough benefit to pay the $30/month in my case.

 

[cellocello]

The problem with the iPhone is the price of the contract. Yeah, the phone itself is cheap, but the contract is ~$100/month - that's a lot of coin. An iPhone Nano would target the crowd that wants a convergence device (phone + iPod) and doesn't want a $100/month commitment. That's a different market (although, I admit, some iPhone users might leave for the Nano).

So .... is Apple going to sell this thing non-contract? What would the expected cost of this unit be, if it's not subsidized? How is Apple going to monetize this, anymore than a normal Nano?

Making a new piece of kit cost money ... I just don't get how Apple stands to profit from a "dumb-phone-with-a-nano-in-it", anymore than just a Nano (ie. Accessories, iTunes, etc.).

There's a revenue stream to everything Apple does ... I just don't see how this fits in. Bssides, Steve even once said something along the lines of "If cheap enough, I can't imagine anyone not wanting one" when talking about the iPhone. I think the idea is to make the iPhone cheaper - not introduce a "dumb" phone.

EDIT - I should also point out that, in Canada, you can get any plan you want with an iPhone - $20/month plans included.

 

[jmpage2]

So .... is Apple going to sell this thing non-contract? What would the expected cost of this unit be, if it's not subsidized? How is Apple going to monetize this, anymore than a normal Nano?

Making a new piece of kit cost money ... I just don't get how Apple stands to profit from a "dumb-phone-with-a-nano-in-it", anymore than just a Nano (ie. Accessories, iTunes, etc.).

There's a revenue stream to everything Apple does ... I just don't see how this fits in. Bssides, Steve even once said something along the lines of "If cheap enough, I can't imagine anyone not wanting one" when talking about the iPhone. I think the idea is to make the iPhone cheaper - not introduce a "dumb" phone.

EDIT - I should also point out that, in Canada, you can get any plan you want with an iPhone - $20/month plans included.

They would make money the same as they do on the Nano, with the difference obviously being that they are reaching a new target audience (users who want something like an iPod + telephone but don't want a $100 a month bill for service).

Currently the Nano sells for $149 and costs Apple about $65 to actually make according to tear down estimates. Apple wholesale cost to retailers is about $120 so they are "making" about $55 per Nano sold and obviously a LOT more on the accessories, iTunes purchases, etc, over time.

The iPhone Nano wouldn't be any different. Let's say that Apple sells the iPhone Nano to carriers like AT&T for $299 and it is sold in store at a $99 subsidy price. Let's say it costs Apple $100 to build the iPhone Nano (the current estimates are that the 3G costs them about $150 to build).

Apple just made $200 selling that iPhone Nano to your carrier. That's the equiv profit of 3 regular nano MP3 players.

Additionally Apple has the opportunity to sell iTunes purchases and accessories to those new customers and of course they will find a way to ge the App Store to them which also generates Apple a LOT of revenue.

The thing that a lot of you guys don't get is that after the iTunes/App-Store model matures Apple could almost give the hardware away for free as they still stand to make hundreds of dollars off of a customer on software sales alone.

 

[cellocello]

So there would have to be a contract then. I doubt at&t would subsidize a phone for $200 without having a guaranteed return on investment. $200 isn't chump change either - that would have to be one loooong contract, or one similar in cost to what is currently available for the iPhone.

Furthermore, who is this "new target audience" exactly? And why wouldn't they just buy a Nano, instead?

Give away the hardware for free? We're not talking about the same Apple, obviously

 

[jmpage2]

So there would have to be a contract then. I doubt at&t would subsidize a phone for $200 without having a guaranteed return on investment. $200 isn't chump change either - that would have to be one loooong contract, or one similar in cost to what is currently available for the iPhone.

Furthermore, who is this "new target audience" exactly? And why wouldn't they just buy a Nano, instead?

Give away the hardware for free? We're not talking about the same Apple, obviously

Well of course there is going to be a contract with it at least in the U.S. Every other new phone has a contract too so I'm not sure were you are going with this.

Target audience should be obvious. There's a huge number of people who would like an ipod + phone but don't want a $100 a month cell bill. The reason that the iPhone is expensive is because of the unlimited data. If an Edge only Nano came out that had a $15 limited data and text plan they could sell the crap out of it.

The arguments you are making are similar to arguments people made about how there was no market for the iPod Shuffle, iPod Nano, etc. Of course there's a market for a less expensive less featured device.

As to the comment about how Apple could give the hardware away for free, obviously they won't, but the point I was making is that these devices are uniquely positioned by Apple to earn them a lot of revenue over time as they are making profit every time you buy an overpriced Apple accessory or make an iTunes or App Store purchase. Apple is a premium product right now but in another few years there will be a dozen handsets similar to the iPhone.

Apple is positioned very well to dominate this space by coming out with different handsets aimed at different users, but all tied into the highly profitable App Store, iTunes and name brand accessories.

What do you think Apple makes in profit when someone pays $25 for a simple USB cable that costs .50c to make and package in China?

 

[Demosthenes X]

Furthermore, who is this "new target audience" exactly? And why wouldn't they just buy a Nano, instead?

Read the thread, then come back. This has been answered multiple times.

The Canadian example is irrelevent. The American market is 10x the size of ours, and down there AT&T requires a data plan. The cheapest iPhone plan is ~$60/month.

 

[cellocello]

But it isn't like the shuffle or nano iPods at all.

Those filled a definite (and obvious) hole in their product offerings. This nano phone talk, regardless of what was said earlier in the thread, is exactly like all the "headless mid-tower Mac" talk. Wanted by a minority, or "assumed wanted" for others, by that same minority.

The only difference, is that this device costs Apple money and *doesn't* introduce any new ways for Apple to make money. The shuffle and Nano were natural evolutions of the product line, and were by-products of the technolgical evolution of the MP3 components Apple was already working on anyway.

But this? This requires that Apple forgo what they've been working on, tech wise (makes them go backwards, actually. Like, Edge only?). Forces Apple to work with AT&T (and presumably other carriers) on another product line. Doesn't introduce any new ways to make money (in fact, it removes the mobile golden peach - the App Store). And this is all before we've even talked about how it's going to work, interface wise!

If it's in ANY WAY more complicated/harder to use than an iPhone, I think it's safe to say Apple won't introduce it. Like .... the ROKR, but version 2? With the burden entirely on Apple? Is that what everyone is describing?

And again, in Canada AND other countries BESIDES the US, people can pick from any plan they like. I imagine other countries are the same. "Avoiding a big monthly bill" isn't a good argument for the iPhone Nano, IMO.

All that being said - it may happen. Maybe. But I'm doubter, personally.

 

[cellocello]

Read the thread, then come back. This has been answered multiple times.

The Canadian example is irrelevent. The American market is 10x the size of ours, and down there AT&T requires a data plan. The cheapest iPhone plan is ~$60/month.

Thanks homie. It's not like I've been posting in this thread or anything .....

I wonder how big the world's cell market is. I mean, not that an American like you would care, but still.

 

[tuckerja]

I just don't get how Apple stands to profit from a "dumb-phone-with-a-nano-in-it", anymore than just a Nano (ie. Accessories, iTunes, etc.).

There's a revenue stream to everything Apple does ... I just don't see how this fits in. Bssides, Steve even once said something along the lines of "If cheap enough, I can't imagine anyone not wanting one" when talking about the iPhone. I think the idea is to make the iPhone cheaper - not introduce a "dumb" phone.

The problem with your statement is that the majority of the world uses "dumb" phones. So much of the world also buys music from iTunes and would like it on their "dumb" phones but can't do it. I myself have a "dumb" phone. I don't want an iPhone because I hate texting on touch screens and I don't want a data plan. (I also hate att, but if an iPhone nano did come out it would probably be on att, so i guess i lose either way.) I would love to be able to carry one device that houses my phone and iPod. I don't want the internet in my pocket because I already pay $50 a month for internet at home.

The point is that MOST people would rather have a "dumb" phone because it costs so much less each month. If they can get an apple phone with a "dumb" phone monthly rate they will jump on it. If it weren't possible for apple to make money off of it then motorola, lg, and nokia would not make "dumb" phones at all.

 

[cellocello]

The point is that MOST people would rather have a "dumb" phone because it costs so much less each month.

Ok, how about this: Lets say you could have an iPhone for $15 a month. Would that change your opinion about an iPhone Nano coming out?

 

[jmpage2]

But it isn't like the shuffle or nano iPods at all.

Those filled a definite (and obvious) hole in their product offerings. This nano phone talk, regardless of what was said earlier in the thread, is exactly like all the "headless mid-tower Mac" talk. Wanted by a minority, or "assumed wanted" for others, by that same minority.

The only difference, is that this device costs Apple money and *doesn't* introduce any new ways for Apple to make money. The shuffle and Nano were natural evolutions of the product line, and were by-products of the technolgical evolution of the MP3 components Apple was already working on anyway.

But this? This requires that Apple forgo what they've been working on, tech wise (makes them go backwards, actually. Like, Edge only?). Forces Apple to work with AT&T (and presumably other carriers) on another product line. Doesn't introduce any new ways to make money (in fact, it removes the mobile golden peach - the App Store). And this is all before we've even talked about how it's going to work, interface wise!

If it's in ANY WAY more complicated/harder to use than an iPhone, I think it's safe to say Apple won't introduce it. Like .... the ROKR, but version 2? With the burden entirely on Apple? Is that what everyone is describing?

And again, in Canada AND other countries BESIDES the US, people can pick from any plan they like. I imagine other countries are the same. "Avoiding a big monthly bill" isn't a good argument for the iPhone Nano, IMO.

All that being said - it may happen. Maybe. But I'm doubter, personally.

You are making an awful lot of assumptions about a device that doesn't exist yet.

We don't know whether or not an iPhone Nano would in fact look anything at all like the click wheel Nano.

There's absolutely no reason it couldn't have a smaller touch screen and even have the same resolution as the full fledged iPhone but simply be lacking certain other features.

OR it could have touch screen with different screen resolution and run some app store software natively or have its own app store.

You are claiming an awful lot of things as fact to back up your position when all we have to go on right now is a case that shows a device 2/3 the size of the iphone but still with a touch screen.

 

[tuckerja]

Ok, how about this: Lets say you could have an iPhone for $15 a month. Would that change your opinion about an iPhone Nano coming out?

Wow yeah, how would that be possible? Maybe if they put it in pay as you go and I only get 150 minutes a month with no text.

 

[tuckerja]

You are making an awful lot of assumptions about a device that doesn't exist yet.

We don't know whether or not an iPhone Nano would in fact look anything at all like the click wheel Nano.

There's absolutely no reason it couldn't have a smaller touch screen and even have the same resolution as the full fledged iPhone but simply be lacking certain other features.

OR it could have touch screen with different screen resolution and run some app store software natively or have its own app store.

You are claiming an awful lot of things as fact to back up your position when all we have to go on right now is a case that shows a device 2/3 the size of the iphone but still with a touch screen.

I agree with you. I actually don't think that apple will produce an iPhone nano. If they do I think they would probably go the touch screen route due to its hype right now. My "pos" mockup is just what I would love to own. That along with all my previous comments just reflect my desires for a cell phone. But all in all I think you're right.

 

[milani]

For one thing you are way off target. Many phones are subsidized to the same extent as the iPhone and not all of them are smart phones. The Moto Razr was sold only 18 months ago with full $200 subsidy. All of the other smart phones are sold with the same subsidy as the iPhone.

Your comment about AT&T having input on iPhone is also completely off base. It's well publicized that in fact Apple told AT&T what they would be getting. This is obvious since the iPhone is the only phone that AT&T sells that isn't co-branded and doesn't have custom applications, etc, that tie the handset to their brand.

Apple basically told AT&T, "here's our iPhone, it will be the best selling phone ever, you will get lots of new subscribers, take it or leave it".

I don't believe for one minute that AT&T had anything to do with iPhone development beyond network/performance testing as the handset and firmware were being developed.

In any event, we will know if these rumors are true soon enough. I personally do expect a new form factor iPhone by July of 2009 at the latest, whether it be a nano iPhone, flip iPhone, iPhone clam shell, etc.

Not at all, but ok.

And you still haven't told me what phones are sold at full subsidy without a contract (probably because no phone is subsidized without a contract - hence the very nature of the subsidy in the first place). I think you're fundamentally confused on what a subsidy is.

 

[Demosthenes X]

But it isn't like the shuffle or nano iPods at all.

Those filled a definite (and obvious) hole in their product offerings.

And how does an iPhone Nano not do the same? If the iPhone Nano is to the iPhone what the iPod Nano is to the iPod Touch, please explain how it's not a logical progression.

Clearly there was and is a market for a smaller, lower capacity, and cheaper iPod. That suggests there will certainly be a market for a smaller, lower capacity, cheaper iPhone - especially once you factor in the cost of the contract over two years. The iPhone Nano might end up being $700+ cheaper over that timeframe (assuming data is $30/month on the iPhone).

The only difference, is that this device costs Apple money and *doesn't* introduce any new ways for Apple to make money. The shuffle and Nano were natural evolutions of the product line, and were by-products of the technolgical evolution of the MP3 components Apple was already working on anyway.

Selling a product to someone who would otherwise not buy an Apple product doesn't make Apple money? Granted, some people might switch from an iPod Nano to an iPhone, but I think an iPhone Nano would have a higher profit margin, because the cost can be disquised with carrier subsidies. That means more profit for Apple, not less.

But this? This requires that Apple forgo what they've been working on, tech wise (makes them go backwards, actually. Like, Edge only?). Forces Apple to work with AT&T (and presumably other carriers) on another product line. Doesn't introduce any new ways to make money (in fact, it removes the mobile golden peach - the App Store). And this is all before we've even talked about how it's going to work, interface wise!

Why Edge only? It could easily have 3G connectivity without a full browser. There's also nothing to say it would need to be AT&T only (although that one seems likely). And as has been said many times, it does introduce new ways to make money - namely, by offering a new, higher margin product for sale.

Interface wise? We're talking about an iPod Nano with a cell phone in it. Interface is easy...

Your argument seems to be, Apple offers the iPhone, why would they offer another cell phone? Well, I hate to break it to you, but Apple offers three seperate versions of the iPod, three seperate versions of the desktop computer, and three seperate versions of the laptop computer. They offer a different product, at a different price point, to suit different consumers. The iPhone is a fantastic device, but it is not a "one size fits all" device. If Apple is serious about the cell phone market, then logic dictates they will produce more than one type of cell phone.

I can't think of a single company that has managed to do well in a market by producing one particular product. Does Honda produce one model of car? Of course not - some people want a compact, some people want a minivan, and some people want a convertible. So Honda offers different types of cars. Similarly, not everyone wants a smartphone with an expensive contract, so why wouldn't Apple produce another type of phone?

There are lots of good reasons for Apple to make a simpler phone. Whether they actually will I don't know, but I think it's more likely than not.

 

[cellocello]

You are making an awful lot of assumptions about a device that doesn't exist yet.

We don't know whether or not an iPhone Nano would in fact look anything at all like the click wheel Nano.

There's absolutely no reason it couldn't have a smaller touch screen and even have the same resolution as the full fledged iPhone but simply be lacking certain other features.

OR it could have touch screen with different screen resolution and run some app store software natively or have its own app store.

You are claiming an awful lot of things as fact to back up your position when all we have to go on right now is a case that shows a device 2/3 the size of the iphone but still with a touch screen.

*I'm* the one making assumptions here? hahaha

Smaller touch screen? Possible same resolution? Run "some" native apps? Possible different resolutions? Looks the same, but 2/3's the size? Maybe the same size? A "Nano" App Store?

I dunno man ... it just seems like an overly complicated solution to a problem that just barely exists. Or at least, a problem that can pretty much be solved with either an iPod Nano, an iPod Touch or an iPhone.

EDIT: And interface is easy, is it? Would this thing have a typical 3x4 keypad, or a clickwheel? How would texting/adding contacts work. What value could Apple bring to the mobile world by making another "me-too" candy bar phone?

EDIT 2: You know, it's funny. On the other boards here, people complain how it's "so apple" to not release more products variations (like Dell or Acer does with laptops). But yet, here, people are saying how it's "so apple" to release multiple versions of each of their products (even though there's already 4 iPhones - 2 of them "cheap"), and that's it's expected of them. Funny how that is.

 

[jmpage2]

Not at all, but ok.

And you still haven't told me what phones are sold at full subsidy without a contract (probably because no phone is subsidized without a contract - hence the very nature of the subsidy in the first place). I think you're fundamentally confused on what a subsidy is.

Of course I know what a cell phone contract subsidy is. I think the confusion is that you said something that seemed to equate to a potential iphone nano being sold without a contract and sort of missed the entire point of the argument.

What myself and a few others are saying is that in all likelihood an iphone nano would be sold with a contract and would be subsidized but would very possibly have a much lower contract cost than the current iphone.

AT&T has many media plans for non smart phones that offer limited EDGE data and texting for as little as $10-$15 a month.

For the non uber geeks out there it is certainly going to be more attractive to get locked into a $55 a month contract for two years than the $75 or more that the current iphone costs. In the case of kids who "need" unlimited texting plans the current iphone actually runs a staggering $85 a month if they have minimum minutes.

2 years with iphone 3G and minimum contract is $2000 including purchase price of $199 for the phone and no FAN discounts. This also doesn't include additional service charges, etc.

Hypothetical $99 iphone nano with $55 a month basic voice, EDGE and text plan would cost over $500 less over the same two year period of time. This might not seem like a lot of money but certainly is a lot to some people, and especially for parents with bratty children who want a full featured cell phone.

A few other people in here summarized very well why Apple will want to go after the lower end market with these products, it's also laughable to say that Apple has 4 iphone models. Apple has one current model that comes in two capacities, which constitutes ONE model not 2 and not 4 as the non 3G is out of production.

People can go on sticking their head in the sand all they want to but Apple has no other product category OTHER than the iphone in which they sell only a single model of a product.

 

[nfl46]

I don't like the idea of an iPhone nano, at all.

 

[cellocello]

I don't like the idea of an iPhone nano, at all.

No worries, my friend - it isn't coming

 

[basesloaded190]

No worries, my friend - it isn't coming

you know i really don't care if it doesn't come out or if it does, but in the back of my mind i hope it does just so people like you who are so confident about something you have no idea about can look like a complete idiot.

 

[jmpage2]

you know i really don't care if it doesn't come out or if it does, but in the back of my mind i hope it does just so people like you who are so confident about something you have no idea about can look like a complete idiot.

It's okay either way. I do remember the people who argued ferociously years back about how Apple would never introduce an ipod with more than 20GB hard drive (who could ever use all that space!?!?! lol), how they would never introduce a flash based ipod, would never introduce a product like the Mac Mini, etc, etc, etc.

Companies produce dozens of prototype products and spend millions on market research. If there's a market for another model of iphone Apple knows about it and is developing products for this market even if they never get past the prototype stage. But hey, why listen to an engineer like me who actually gets involved in such work when you can listen to high school and college age know-it-alls who have never had to hack it in the real world?

The fact that companies in China are leaking schematic drawings of case sizes, etc, which is something that has happened with previous product releases just increases the probability we will see such a product sooner than later.

 

[Tallest Skil]

you know i really don't care if it doesn't come out or if it does, but in the back of my mind i hope it does just so people like you who are so confident about something you have no idea about can look like a complete idiot.

Watch this; I'll break your logic.

*ahem* Apple will never make a 13.3" MacTablet.

Now, when they do, it's still a happy ending for me because I want one.

 

[basesloaded190]

Watch this; I'll break your logic.

*ahem* Apple will never make a 13.3" MacTablet.

Now, when they do, it's still a happy ending for me because I want one.

there's a way to think of it. Many who hate on it now, may jump on that band wagon if it does come out.

Seems to happen about a lot of stuff.

 

[cellocello]

It's okay either way. I do remember the people who argued ferociously years back about how Apple would never introduce an ipod with more than 20GB hard drive (who could ever use all that space!?!?! lol), how they would never introduce a flash based ipod, would never introduce a product like the Mac Mini, etc, etc, etc.

Companies produce dozens of prototype products and spend millions on market research. If there's a market for another model of iphone Apple knows about it and is developing products for this market even if they never get past the prototype stage. But hey, why listen to an engineer like me who actually gets involved in such work when you can listen to high school and college age know-it-alls who have never had to hack it in the real world?

The fact that companies in China are leaking schematic drawings of case sizes, etc, which is something that has happened with previous product releases just increases the probability we will see such a product sooner than later.

hahahah. Ok ok ok. Clearly your broad assumptions about me are true, and the iPhone Nano is coming.

What can I say, I'm just critical of illogical rumors and you, apparently, buy into them. Big deal - just different strokes man.

"Case providers from China" have been wrong before, and there's a possibility that, just maybe, they could potentially be wrong again in the future. Just maybe.

EITHER WAY, I guess we'll find out soon enough. Like Jan or July or something, right?