• Explore the magic and the mystery!
  • The Tech Night Owl's Home Page
  • Namecheap.com





  • Has the Cheap iPhone Been Outed?

    July 31st, 2013

    In recent weeks, we’ve heard about, in no particular order, something called the iPhone Lite and now the iPhone 5c. Is there any factual authority behind either, or some other unspecified lower cost iPhone? It would seem that there is, if you can believe where the online chatter and even mainstream news sites are going.

    Now it is also fair to say that there is an awful lot of false information posted about Apple. Witness that recent story claiming that Samsung’s profits from their handset division were higher than Apple’s with the iPhone in the June quarter. That turned out to be a big lie perpetrated by people who didn’t know better, or had an agenda. Without going into detail, the first report listed Samsung’s profits before taxes against Apple’s after taxes. But the story also took a Samsung division that also includes tablets and PCs and compared it to the iPhone division at Apple. But few of the outlets that fell for this scam have had the good sense to backtrack and correct the misinformation.

    But there appears to be a real reason for a lower-cost iPhone. That’s before you look at the so-called leaks, and the recent “outing” of such a product by an employee at one of Apple’s contract factories.

    If you look at recent sales figures, the iPhone 5 reportedly held a 52% share of Apple’s smartphone sales. The rest was split between the iPhone 4, released in 2010, and the iPhone 4s, released in 2011. So Apple has prospered significantly simply by continuing to build older models, which, naturally, use older technology. If Apple held to this game plan, the iPhone 4 will disappear this fall,  the iPhone 4s will become the cheapest model, and the iPhone 5 will become the mid-range contender once the expected iPhone 5s appears.

    Now keeping old production lines moving may, I suppose, not be costly, since the initial R&D and setup expenses have long since been recovered. But wouldn’t Apple do better to take advantage of the production techniques learned since these two models came out? Can similar or somewhat beefier features be added without significantly changing the cost of production? What about supporting LTE across the product line?

    I realize that you cannot expect Apple to build a cheap iPhone, but selling less expensive gear is par for the course. Today’s iPhone 4, purchased unlocked, is over $400. By taking advantage of newer, cheaper parts and sticking with a plastic case, could Apple bring the retail price down to $299 or $349 with good profits? Very likely, and that would appear to be the logic behind the alleged iPhone 5c.

    Why iPhone 5c? Well, the rumors and the “leaked” prototypes display multiple colors, and there is even a photo of a packaging tray that supposedly contains the bottom of an alleged plastic container in which the units would ship, labeled iPhone 5c. This week, there were also stories that iPhone 5c cases have already appeared on Amazon, although I didn’t see any when I did a search. In fairness, this might be country specific, or such products were quickly removed.

    The long and short of it is that it doesn’t take a stretch to expect Apple to prefer to sell current products at different price points, rather than just keep older models around. Yes, you can still get an iPad 2, and an iPod classic, but older Macs continue to be removed from the catalog when newer models appear. So a cheaper iPhone is not only consistent with Apple’s stated goals, but supremely logical. I very much expect to see one.

    Now as far as the high-end iPhone is concerned, I do subscribe to the theory that it will be called an iPhone 5s, keeping with the tradition of upgrading form factors every two years. That being the case, don’t expect it to look very different from the iPhone 5. Most of the changes will be inside, which means speculation about a 4.3-inch version don’t have support. Would there be an iPhone Max to serve that possible need? Maybe, although the iPhone, despite the smaller screen, seems to be doing perfectly fine in the marketplace against competitors with larger displays.

    What I really expect to see, aside from faster chips (perhaps an A7) is support for fingerprint recognition. That feature appears to already be present in the current iOS 7 betas, and it’s not that Apple is doing to bake something into the OS that isn’t going to be used somehow. Besides, Apple bought a company with that technology, AuthenTec, back in 2012 for a reported $356 million, and that wasn’t a casual investment.

    Other expected features include a higher resolution camera, with 12 or 13 megapixels, and perhaps some behind-the-scenes hardware refinements to the screen and other parts to make the next iPhone cheaper or more efficient to build, yet retain a high quality level. NFC? Well, maybe not. It’s not that the technology has been going anywhere, except in some Android gear.

    When will all this joy be upon us? Apple promises to deliver iOS 7 this fall, so it may all arrive towards the latter part of September. One suggestion of a launch event on Friday, September 6th has already been shot down by The Loop’s Jim Dalrymple, who seems to have an inside track on such matters. Believe him. Besides, Apple traditionally holds media earlier in the week, and right after Labor Day is a stretch.



    Share
    | Print This Article Print This Article

    2 Responses to “Has the Cheap iPhone Been Outed?”

    1. Ted Schroeder says:

      C for Cheap? China? Consumer?

      I go for iPhone 5c for Color.

    2. Articles you should read (July 31) …. says:

      […] “Has the Cheap iPhone Been Outed?: In recent weeks, we’ve heard about, in no particular order, something called the iPhone Lite and now the iPhone 5c. Is there any factual authority behind either, or some other unspecified lower cost iPhone? It would seem that there is, if you can believe where the online chatter and even mainstream news sites are going.” — “The Tech Night Owl” (www.technightowl.com) […]

    Leave Your Comment