Apple won't risk cheapening the iPhone.
It wouldn't be Summer without new rumors about the next iPhone. June has come- and almost gone- with no new iPhone in sight. Those whispers of an August or September launch for the iPhone 5 have gained a bit of credibility. But every day Apple waits shoves the rumor mill into higher gear. It's come to a boiling point today, with an analyst report that two iPhones would hit this September.
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Here's the Cliff's Notes:
-Deutsche Bank's Chris Whitmore expects an iPhone 4S and an iPhone 5 to launch this year.
-The iPhone 4S will be an unlocked, pre-paid $350 device aimed at low-income customers and developing nations.
The idea of a cheap, pre-paid iPhone is enticing. There are millions (Chris says around a billion) who want a smartphone but prefer pre-paid devices. A cheap iPhone without a contract would draw in a huge number of customers currently on the fence or considering a pre-paid Android phone. But is it actually the sort of move Apple would make?
The current iPhone 4 only costs $188 to manufacture, so Apple can definitely afford to drop the cost, even after adding in a few iterative improvements. And the pre-paid market would offer Apple the kind of control they're so badly addicted to. With no service agreements or two-year plans the carrier of a pre-paid iPhone would be little more than a dumb pipe.
Apple has a reputation as a premium gadget-maker though. And I find it extremely unlikely that they would roll out two iPhones at once in the same short span of time. A pre-paid iPhone and the iPhone 5 would both be significant releases, deserving of their own big launch event and plenty of hype. Apple risks cheapening the iPhone if they start throwing out functionally different models at the same time.
If we do see two iPhone launches in 2011, the second won't hit until later in the year. A pre-paid iPhone would make sense for a holiday launch. It's the right price for a Christmas gift and it comes without the strings of a contract attached. Parents and budget-loving gadget nerds alike would buy them by the bushel.
Or Apple may hold off on that launch until early in 2012. A pre-paid iPhone would be big enough news to wrestle the spotlight away from CES for a few days. And, if there's one thing the last year has shown us, it's that Apple excels in stealing the spotlight.