About that “Cheap” iPhone

August 14th, 2013

So the conventional wisdom, such as it is, has it that Apple is being forced kicking and screaming into building a lower cost iPhone. Although the top-of-the-line model is relatively inexpensive on a subsidized postpaid carrier contract (the one you pay when you get a bill), it’s a huge jump if you have to pay it all at once.

Of course, wading through the morass of junk that passes for tech journalism these days isn’t easy. Some commentator’s, such as Macworld’s “Macalope,” specialize in handling the fact-checking chores. But the hooved one’s influence appears mostly confined to the choir, as the same falsehoods continue to be repeated by people who should know better. It’s almost as if some of those Apple skeptics are reading from the same playback.

Sure, there are many legitimate criticisms that can be made about Apple. Check these columns, and reader comments, and you’ll find plenty. With so much authentic material out there, why make things up?

The fact of the matter is that Apple has lower-cost products everywhere. You can buy an iPod for $49. The iPad mini starts at $329, and there are even iPad 2s to be had if you want a larger tablet but don’t want to pay $499 for the entry-level fourth generation model. The Mac mini is relatively affordable, and you can buy an iPhone 4 free with a contract. But it’s also a model that first arrived in 2010, and so much has changed.

In recent months, the less expensive iPhones have taken an increasing share of the market, particularly as Apple continues to move into countries where disposable income is less. But the unlocked purchase price, roughly $450 in the U.S., is a big climb for an old model. What’s Apple’s solution?

So there are growing reports, and photos of alleged prototypes, which appear to indicate that an iPhone 5c, 5M, or Lite model will flesh out the low end of the product line beginning next month.

I won’t dismiss all the photos of cases and parts as being faked. That’s not unusual, though even the supposedly knowledgeable tech pundits are saying that Apple will eschew difficult assembly schemes and go plastic to keep costs down. Since most of you probably put your iPhone in a case anyway, to protect it from damage, there’s little harm done. A plastic Samsung Galaxy smartphone hasn’t hurt sales, despite the criticisms from some reviewers.

Taking plastic, and filling it with less powerful parts would, so they say, allow Apple to offer the handset — let’s call it iPhone 5c to be consistent — to be offered free with standard carrier subsidy plans, and around $400 or so retail. One report says as little as $300, which would still be a stretch compared to some of that cheap Android junk out there. But this would be the genuine iPhone, and you wonder what Apple might remove.

There is that claim, from an analyst I shall not name, that Apple will not support Siri. But even the iPhone 4s offers Siri, and that feature is a cornerstone of Apple’s mobile strategy. Indeed, Siri has already begun to show up in the family auto, so a decision of that sort would seem shortsighted, one that would involve cheapening a product more than is expected from Apple.

In short, I fully expect all iPhones introduced next month to include Siri, period. I might be wrong, but if I am, I would only blame Apple for being too aggressive with cost-cutting. Well, I can be egotistical too.

Would a cheaper iPhone cannibalize sales from the next-generation model, presumed to be the 5S? Sure, but that is already happening. The iPad mini takes sales away from the full-sized iPad, and the iPad takes sales away from Macs. But Apple would prefer you buy something from the company rather than nothing, so they accept cannibalization. They’d rather see customers ditch Windows and Android and other platforms, and if a lower-cost but still high quality iPhone helps, so be it.

Understand that nothing about the next iPhone, the configuration, or the possible existence of a cheaper model, has been confirmed. Apple has said nothing about the prospective media event, although that would appear to be a given in light of the fact two respected Apple watchers — AllThingsD and The Loop’s Jim Dalrymple — have confirmed it. They have great track records for such things.

I also expect that Apple will not hold off a cheaper iPhone until later in the year. The expectation of such a gadget arriving at a later time would likely depress sales. But you will probably not hear anything about the next iPad or a Mac refresh. There are no doubt some new Macs in the pipeline, but they will arrive with press releases. Or maybe there will be something special to herald the debut of the Mac Pro, since it is such a major change, and Apple will use that occasion to update the rest of the lineup and announce the release of OS X Mavericks.

As for me: I would actually consider an iPhone 5c; if not for me, for the Mrs. She isn’t so concerned about the latest and greatest hardware, so long as everything just works.

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