Over the past week, rumors have been spreading about Apple creating a cheaper phone for the market. After speculation about Apple producing a phone that is made from cheaper materials, Apple’s senior vice president Phil Schiller stated, “Despite the popularity of cheap smartphones, this will never be the future of Apple’s products. In fact, although Apple’s market share of smartphones is just about 20 percent, we own the 75% of the profit.” His quote has led recent reports to believe that the rumors of a cheaper iPhone may be just that, a rumor. But why would Apple even want to make a cheaper iPhone?
As the Apple brand has represented quality and durability, the reputation of the company may be tainted from the cheaper materials that would potentially be used for the new phone. In order to sell the phone at a more affordable price, Apple would probably have to downgrade from the usual metal and glass exterior to a plastic covering. This would allow the phone to be priced between $99-$149, instead of the unlocked iPhone price ranges of $649-$849.
If Apple surprises everyone and follows through with this cheaper phone, there would be a bigger screen that would go with the less expensive components of the phone. This would likely lead to a different size iPhone than its formers, which means that new iPhone accessories will also be available. The rumors of a more affordable iPhone have excited many people and the purchases of new accessories will only help with Apple’s sales.
Reasons as to why Apple would produce a cheaper phone? The move towards building a less expensive phone is focused on competing with the more affordable smartphones available. As the smartphone market for low-end phones are growing at a much faster rate than the high-end phones, Apple has faced a decline in sales. After the release of the iPhone 5, the demand of iPhones has shifted to Samsung’s Galaxy S III. This is because the S3 is available for a better price, while also leaving users to believe that it’s quality is better when compared to the iPhone 5.
Another reason towards Apple’s potential creation of a more affordable phone is to target customers in less developed markets. The popularity of iPhones has come from the United States and Europe, and Apple is hoping to expand its sales to meet the conditions of customers in underdeveloped areas such as India.
As Apple has been the face of technology for some time now, it’s in their best interest to find ways to continue to dominate the market. In order to do this, creating a cheaper phone for the public may be the best move for the company in order to stay competitive against all of the other smartphones available. According to Munster, a low-cost iPhone would give Apple access to 65% of the smartphone market where its current lineup of high-end phones don’t play. The article predicts that Apple will be able to sell 100 million of these more affordable iPhones in 2014, which will help the company raise sales to 22%.
Excited about the possibilities of Apple’s more affordable iPhone? If rumors are true, the release of this phone is aimed for the middle of this year.
Taryn Wong is a content writer for Wireless Emporium, the leading online retailer for cell phone accessories.