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Analyst Predict Launch of Cheap iPhone for 2014

According to one analyst, Apple is expected to launch a cheap iPhone in 2014 as part of an effort to increase its market share in the lucrative Chinese market.

Gene Munster believes the company should launch a $200 iPhone handset in the region due to mobile operators in the Far East refusing to subsidize the current models. While consumers in other markets around the world have the option of purchasing the phone subsidized and on a contract, consumers in China must purchase the smartphone outright.

The firm said it would be wise for Apple to create a new variant of the iPhone for this market as opposed to heavily discounting previous models of the smartphone. Consumers have long and rightfully been complaining about the price tag placed on Apple products. Without a contract, devices such as the iPhone retail for over $500 in the U.S. or £529 ($846) in the United Kingdom. The iPad sports a higher price tag due to its 3G/4G capabilities.

Due to its various price points and range offered by vendors, Google's Android dominates 90 percent of the market in China. The average cost of an iPhone is 3.25 times higher than that of the average Android smartphone sold in the country.

While Apple has defended the iPad Mini's $329 price, Microsoft CEO Steve Ballmer has stressed that the Cupertino company charges too much for its products. Moreover, Apple is arguably charging premium prices for devices that aren't considerable upgrades from their predecessors. Apart from its increased length, the iPhone 5 doesn't really offer a worthy improvement to the consumer when compared to the iPhone 4S, while similar arguments can be made for the iPad line. When the iPad 4 was announced, owners of previous models of the device were understandably frustrated. The unveiling of the tablet came just six months after the release of the iPad 3.

Analysts have warned that innovation at the firm is "sputtering", while Apple's own co-founder has also expressed concerns regarding creativity at the world's richest company.

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  • Graham_71
    Nearly 70% more expensive in 'Rip-off-Britan' that's no surprise.
    Reply
  • mrmaia
    Another poor "analyst opinion"/Apple advertising article by Zak, even though it states the truth (iCrap is overpriced).

    9431257 said:
    Nearly 70% more expensive in 'Rip-off-Britan' that's no surprise.

    In Brazil the iPhone 5 is yet to be launched, but the 4S is sold for R$2000 (~$1000).
    Reply
  • shine8210
    Cheap? Iphone? Hahahahahaha Toms you so funny. You can't use those two words in the same sentence.
    Reply
  • spentshells
    Did I just read 5 has nothing over the 4S?

    HAVE YOU NEVER USED LTE?
    Reply
  • freggo
    It's a friggin phone.
    If your self worth comes from the logo on the phone in your pocket you have problem.

    The bigger issue is that nothing from the Apple Universe plays nice with the rest of the world.
    And THAT is a reason (one of them) to stay away from their products.
    Reply
  • manicmike
    9431261 said:
    Cheap? Iphone? Hahahahahaha Toms you so funny. You can't use those two words in the same sentence.

    rofl the iPhone is cheap. Or at least it should be, copyrighting a few nicknames for normal tech like a screen that has a "retina display" doesn't make the $500 phone any better than the $200 one, but sadly the average consumer is too simple minded to realize that.

    "This phone has an Ultron battery with an octo-touch screen and carbonized titanium alloy plating... And when I hold this square button, it tells me what a tool I am!!!"
    Reply
  • Offering a cheap model might also affect Apple in bad ways:

    (1) The presence of a cheaper model might cannibalize its own premium phone sales, and hence, lower profit margin. In essence, cheaper model will trade profit margin for market share.

    (2) The current high share price of Apple is based on the assumption that the company will continue to have high profit margin while pushing the current level of volume, year after year. Reduction of profit margin may see market reacts by lowering share price.

    As a company with such a high market capitalization, Apple only has 4 product lines. This is a very dangerous situation for Apple as any failure in one product line will trigger share price drop. Apple should concentrate more on inventing more products, instead of keep refreshing existing products, to diversify the portfolio for revenue. If Apple has lost the will to invent, then they can try to get their hand dirty and buy over fabrication plants etc to actually make the parts that they need, and become a supplier of parts to other vendors as well. Apple cannot hope to stay on the top spot for long without making more products. Sooner or later the fans will realize the new models do not have enough improvements to upgrade and the sales will drop.
    Reply
  • bllue
    I hope the Chinese don't buy into the fad if this happens
    Reply
  • garrick
    Rumors have been floating around before the 4s launched that maybe Apple would come out with a cheaper iphone but nothing ever materialized from that rumor so I doubt Apple will go through with something like this.
    I hate Apple for overcharging customers not only for the products but for tech support which is ridiculously expensive to where you might be better off buying a new product instead of sending it in for repairs as they will charge you an arm and a leg for relatively simple repairs.
    Reply
  • sonofliberty08
    i think they just mean more cheap quality, but not cheap price :)
    Reply