Now, under pressure from cheaper Android devices, Apple’s looking to attract new customers turned off by high prices.
Apple Inc. AAPL +0.27% is working on a lower-end iPhone, according to people briefed on the matter, a big shift in corporate strategy as its supremacy in smartphones has slipped, reports the Wall Street Journal.
While Apple has explored such a device for years, the plan is progressing and a less expensive version of its flagship device could launch later this year, one of the people said.
Natalie Kerris, a spokeswoman for Cupertino, California- based Apple, declined to comment.
Actually Apple is weighing retail prices of $99 to $149 for a device that would debut in late 2013, at the earliest, according to the person, who asked not to be named because the negotiations are private.
Apple Chief Executive Officer Tim Cook has said China is a priority. The company generated $5.7 billion in sales in China in the quarter ended in September and sold more than 2 million iPhone 5s during its weekend debut there last month.
Rumors of low-cost and smaller iPhones have floated around for quite some time, in fact already in 2011.
Executives at Apple have been particularly interested in building a lower-cost model with less-expensive components as a way to appeal to customers in emerging markets, another person has said.
Even founder Steve Wozniak has gone on record saying that he wishes “the iPhone 5 wasn’t just a taller iPhone 4S,” instead noting that the company should have created a smaller (iPhone 4S and previous) and a larger (not just taller, but wider as well) version of its wildly popular device.
The Next Web says, as with all Apple rumors, it’s wise to take news like this with a grain of salt. Apple’s pending (aka possibly never happening) large-scale entry into the TV market is proof of this. That said, it’s rare to see such an unflinching statement without some truth being involved, and we’ll be keeping our eyes out as additional news surfaces.
The report says that the phone may use a design similar to the current iPhone but with cheaper parts, such as a polycarbonate body to replace the iPhone 5’s aluminum. There is, however, a disclaimer that Apple may decide against proceeding with the device.
Any such device would certainly represent a major shift in Apple’s product strategy; Cupertino currently offers the iPhone 4 for free with a two-year contract, but doesn’t have any inexpensive unlocked phones — a major hole in its lineup for several global markets.
Adding a less-expensive version of the iPhone would be a strategy shift for Apple, which has until now tried to appeal to more budget-conscious customers by cutting the prices of older models. After introducing the iPhone 5, Apple kept selling the iPhone 4S and iPhone 4 at reduced prices, reports the Bloomberg.
Apple has sold more than 270 million iPhones worldwide. The device generated $80.5 billion in sales last year, accounting for more than half of Apple’s revenue.