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Apple reportedly mulling cheaper iPhone options

by Sarah Griffiths on 18 February 2011, 09:56

Tags: Apple (NASDAQ:AAPL)

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The price is right

Apple has apparently been experimenting with ways to make the iPhone cheaper so it can expand the appeal of its handset.

There were rumours that Apple was working on a smaller, less pricey iPhone but now The New York Times has reported that sources within Apple told it that this is not the case.

According to the newspaper, Apple's engineers are beavering away on the next version of the iPhone, which will be a similar size and predicted to launch in the summertime. It said the firm is not planning to release a smaller version any time soon.

Another source reportedly told The NYT that Apple will not be making a smaller version because it would probably not be any cheaper to make as it would be trickier to operate and a smaller screen would mean some developers would have to re-write their apps, which Apple would obviously want to avoid.

Seemingly quashing the iPhone Mini rumour further, a senior Apple exec is understood to have said that it would make no sense for Apple to roll out multiple iPhone models but it will stick to its tactic of making the older models cheaper upon the arrival of a newer, shinier handset.

Apple is also reportedly trying to expand the appeal of its iPhone by making voice commands easier to use as an option to appeal to those who are not partial to a virtual keyboard. It is also thought to be looking at swapping some internal elements for cheaper options to drive the cost of the handset down.

A source who claims to have worked on different versions of the iPhone told the NYT: "Although the innards of the phone, including memory size or camera quality, could change to offer a less expensive model, the size of the device would not vary."

Apple is also rumoured to be working on a more flexible version of its Mobile Me offering, to allow people to store photos, files and music in the cloud then access them on their devices. It is thought the next version will also be free.

"The goal is that your photos and other media content will eventually just sync across all your Apple devices without people having to do anything," said the newspaper's Apple source.

It is thought that using the cloud could help Apple make cheaper phones with less storage. An analyst at Sanford C. Bernstein & Company reportedly said that a cheaper iPhone could boost Apple's unit sales sixfold.



HEXUS Forums :: 3 Comments

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Well according to the hardware breakdown the iphone 4 costs less to build than $200 so they make a small fortune on it anyway. Maybe if they cut down the onboard memory or gave it a 3mp camera to make it cheaper, then i'm sure fanboys will spend £500 on it, as its got a photo of a half eaten apple on the back.
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Well according to the hardware breakdown the iphone 4 costs less to build than $200 so they make a small fortune on it anyway. Maybe if they cut down the onboard memory or gave it a 3mp camera to make it cheaper, then i'm sure fanboys will spend £500 on it, as its got a photo of a half eaten apple on the back.

even if it's $200 to make, you still have development costs, shipping and taxes, advertising and promotion costs, and the retailer usually takes the biggest cut of profits with most things. for example, a store buys something at £200, they add VAT of 20%, double that and sell at say £449.99 as they usually round to a specific price point. that's why stores can clear items at half price without losing money on them, if you ignore the store overheads such as rent, rates, electricity, staff, transport and distribution, taxes, etc. stock taking up shelf space costs money
Well this is the expected/logical view..but it is just another rumour that doesn't specify a reliable source.

In reality we know that apple wouldn't make a smaller phone (or one with a smaller screen at any rate) as it completely removes one of their key advantages in the marketplace. They may want to make the phone a little cheaper, but not vastly as they don't need to.

This is just another rumour - there will be a proper leak closer to the time most likely, and then we'll see what actually happens in june..