The downside to producing a cheap iPhone
The Wall Street Journal cranked up the Apple rumor mill again with this report that the company may build a cheap iPhone with plastic and older components. The device could come to market by the end of the year, according to the Journal, giving Apple broader access to emerging markets such as China and India. Bloomberg expands on the story today, reporting that the device could cost between $99 and $149 and that Apple is talking about the gadget with a major U.S. carrier.
I’m still skeptical that we’ll see a cheap iPhone anytime soon — the Journal piece says only that Cupertino is “considering” the move, not that any product is even in the development stages. And while a cheaper gadget would certainly be a powerful weapon in some markets, it would also minimize the big hardware margins that help make Apple the most profitable company in mobile. I think Apple was wise to fill out its iPad lineup with the mini, but I think fighting for the low end of the smartphone market would be a mistake for a manufacturer who has built its business on top-of-the-line mobile products.