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WSJ: Apple to build cheaper iPhone as smartphone dominance slips

post #1 of 123
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In a tweet on Tuesday, The Wall Street Journal claimed Apple is currently working on a cheaper iPhone that could hit the market as soon as this year.

iPhone 5


Coming just hours after DigiTimes said Apple would be releasing a less expensive iPhone with a larger 5-inch screen, The Journal tweeted an identical message seemingly corroborating the earlier report.

According to people briefed on the matter, Apple is reportedly looking to a new audience with the less expensive iPhone, a move the WSJ claims is in response to slipping smartphone supremacy.

While Apple has supposedly tossed around the idea of building a more affordable iPhone "for years," the plan is progressing toward a release in the second half of 2013.

The new device could be unveiled later this year and be marketed as an entry-level model to Apple's flagship iPhone. Sources say the cheaper unit may take on the form factor and design of the current iPhone with a chassis made from less exotic materials like polycarbonate. Other parts could "remain the same or be recycled from older iPhone models."

post #2 of 123
I can't wait to re-read the intelligent posts made earlier today about this same subject.
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post #3 of 123
Quote:
Originally Posted by AppleInsider View Post

In a tweet on Tuesday, The Wall Street Journal claimed Apple is currently working on a cheaper iPhone that could hit the market as soon as this year.
Coming just hours after DigiTimes said Apple would be releasing a less expensive iPhone with a larger 5-inch screen, The Journal tweeted an identical message seemingly corroborating the earlier report.

Developing

Less expensive with bigger screen? No no no.

 

My bet? (I'm the guy that was 80% right about the mini, against everyone. why? because I'm awesome)

 

- Same price/ more expensive 5 inch iPhone, iPhoneX (as i said on other threads)

- iPhone 5S, 100dollars cheaper.

 

No low-end.

post #4 of 123

Steve's dead; I buy it. The rumor, that is, not the "cheaper" product.

 

"less-expensive", "5-inch screen". I don't even need humor websites anymore.

post #5 of 123

Stupid

post #6 of 123
Agreed. The screen is probably the most expensive component. So how could it be a larger screen AND a cheaper price? Makes no sense.

And why would anyone even want a 5" screen. Apple's already made a big deal about how they purposely didn't increase the width of the screen so it still could be easily held.
post #7 of 123
I don't understand this. We have the iPhone 5 as the current generation, and Apple sells the iPhone 4S and iPhone 4 if you want cheaper alternatives. It seems to work well.

Why reinvent the wheel?
post #8 of 123
Originally Posted by zoetmb View Post
And why would anyone even want a 5" screen. Apple's already made a big deal about how they purposely didn't increase the width of the screen so it still could be easily held.

 

It won't be any wider, just taller. Eventually the iPhone will be the length of an old-style phone receiver. lol.gif

post #9 of 123

What are the chances that if true, this cheaper iPhone will never see the States or Europe?  Only sold in developing countries that need a cheaper iPhone?

post #10 of 123
Quote:
Originally Posted by Tallest Skil View Post

Steve's dead; I buy it. The rumor, that is, not the "cheaper" product.

"less-expensive", "5-inch screen". I don't even need humor websites anymore.

Is a 5" 264 PPI display less expensive than a 4" 326 PPI display or a 3.5" 326 PPI display? As unlikely it sounds there is a nugget of logic to it. I ran the numbers last week. At 5" you can use the same 1136x640 resolution of the iPhone 5 but with the panels of the iPad (4) to get a 5" display.

Also think of the iPad mini with LTE. That is $469 for 16GB. That is about $200 less than the 16GB iPhone 5 sells for. There are more considerations for costs for a phone but I could see some ways to cut down on costs.

Another consideration is where are the Galaxy Notes and other big ass phone and phablets being utilized? I'd heard it's in markets where they can't buy both so they are choosing a mix of the two.

If that is true that might be a huge market and one that Apple needs to go after. If this market is China it might be an exclusive offering to China Mobile for a duration as part of their deal. It's the one carrier that would be able to leverage Apple.

To be clear, I think it's very unlikely based on the information we have but it's certainly not impossible, and therefore the how, why, when and where of the possibility should be considered..

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post #11 of 123
Guys it's simple. Apple is cutting service on the 3G and 3GS when the 5s comes out. The cheaper phone is the fire sale for unused parts. They are going to sell it full price only for $199 tax each.

Bigger, plastic, cheaper. Done

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post #12 of 123
Originally Posted by allenbf View Post
What are the chances that if true, this cheaper iPhone will never see the States or Europe?  Only sold in developing countries that need a cheaper iPhone?

 

So zero apps built for it, then. Developers would go where the money is.

 

Originally Posted by SolipsismX View Post
Is a 5" 264 PPI display less expensive than a 4" 326 PPI display or a 3.5" 326 PPI display? As unlikely it sounds there is a nugget of logic to it.

 

See, yeah, you're right about that. But would they keep the resolution? Eventually it stops being retina.


Another consideration is where are the Galaxy Notes and other big ass phone and phablets being utilized? I'd heard it's in markets where they can't buy both so they are choosing a mix of the two.

 

In what markets couldn't both be purchased, and wouldn't it make more sense for Apple just to make both of their existing products available there? I can't imagine any situation in which designing, building, testing, and manufacturing an entirely different product is cheaper than paying off whoever needs paid off to get existing products sold somewhere.

post #13 of 123
What Apple needs to do now is make a larger display for iPhone and increase the price .

Not a cheap iPhone . iPhone is earning 2x more than shamesung . Why apple needs to dominate ? Apple is the king nobody comes close !!
post #14 of 123
So if it comes from the Wall Street journal that means its true? The media has been running with this meme for a long time now. Lets not forget they did the same thing with netbooks - everyone and their mother saying Apple had to create a budget laptop i.e netbook. Now it's Apple has to create a cheap smartphone. Same shit different day. Maybe Apple will do something but the chances of it being plastic are less than zero. I mean when they created the iPod mini and nano they weren't plastic were they?
post #15 of 123
Originally Posted by raymondinperth View Post
What Apple needs to do now is make a larger display for iPhone and increase the price .

 

Why?

post #16 of 123
Quote:
Originally Posted by charlituna View Post

Guys it's simple. Apple is cutting service on the 3G and 3GS when the 5s comes out. The cheaper phone is the fire sale for unused parts. They are going to sell it full price only for $199 tax each.
Bigger, plastic, cheaper. Done
If we get a big, cheap plastic phone Apple might be done. Why in the world would they ruin their brand in the pursuit of market share? They survived just fine not getting into a race to the bottom with PC's why start with smartphones?
post #17 of 123

AAPL was boxed in by their own 'retina display' claim. Now they've a problem making larger display size because that'd make the display out of the 'retina' category. If they try to increase resolution, then that'd be yet another resolution for the developers to work on, more fragmentation.

 

Tim and others need to really start thinking about the long term future. We cannot be be stuck with certain resolution screens and marketing claims which slows AAPL's innovation speed. I of course don't have a good solution to this, but just voicing my concern.

post #18 of 123
Quote:
Originally Posted by SolipsismX View Post


Is a 5" 264 PPI display less expensive than a 4" 326 PPI display or a 3.5" 326 PPI display? As unlikely it sounds there is a nugget of logic to it. I ran the numbers last week. At 5" you can use the same 1136x640 resolution of the iPhone 5 but with the panels of the iPad (4) to get a 5" display.
Also think of the iPad mini with LTE. That is $469 for 16GB. That is about $200 less than the 16GB iPhone 5 sells for. There are more considerations for costs for a phone but I could see some ways to cut down on costs.
Another consideration is where are the Galaxy Notes and other big ass phone and phablets being utilized? I'd heard it's in markets where they can't buy both so they are choosing a mix of the two.
If that is true that might be a huge market and one that Apple needs to go after. If this market is China it might be an exclusive offering to China Mobile for a duration as part of their deal. It's the one carrier that would be able to leverage Apple.
To be clear, I think it's very unlikely based on the information we have but it's certainly not impossible, and therefore the how, why, when and where of the possibility should be considered..

 

I agree that it's unlikely, and I'm not liking the idea of embiggened iPhones.  However, your scenario is quite plausible.  I only looked at Galaxy Note 2, and it has 267 PPI.  264 PPI is right in line with the competition, Samsung, anyway.

post #19 of 123
Quote:
Originally Posted by Tallest Skil View Post

See, yeah, you're right about that. But would they keep the resolution? Eventually it stops being retina.

They kept the resolution for the iPad mini so it would be smooth for developers and users alike. They also used 7.85" because that allowed them to use iPhone /3G/3GS display pixel density which will scale to the iPhone 4/4S/5 pixel density making it 2048x1536 when the tech allows it.

The iPhone 5 follows that same pattern by using the same pixel density panels and keeping the width the same to minimize impact on developers and users, and save on engineering and manufacturing costs. Would a 5" at 264 PPI display make the UI elements too large? I think that's possible but I'd have to see something concrete to make that judgement.

Remember the 1x and 2x options on the iPad when running an iPhone app? Well the display size at 1x would be the exact same size as a 960x640 at 262 PPI display at a little under 5". If they would use the elongated 1136x640 iPhone 5 display it's pretty much exactly 5".
Quote:
In what markets couldn't both be purchased, and wouldn't it make more sense for Apple just to make both of their existing products available there? I can't imagine any situation in which designing, building, testing, and manufacturing an entirely different product is cheaper than paying off whoever needs paid off to get existing products sold somewhere.

I don't know but I keep hearing about how the Asian markets love the size of the Galaxy Note and other such devices because they can have a decent tablet that is still easy to travel with and doubles as a phone.

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post #20 of 123

Now people are reporting on tweets? That it "comes from the WSJ" doesn't lend any credibility. Unless they run an actual story, citing sources other than Digitimes, for all anyone knows, some intern at the WSJ read about the Digitimes story, had access to the twitter account, and, ... oh boy!

post #21 of 123
Quote:
Originally Posted by drobforever View Post

AAPL was boxed in by their own 'retina display' claim. Now they've a problem making larger display size because that'd make the display out of the 'retina' category. If they try to increase resolution, then that'd be yet another resolution for the developers to work on, more fragmentation.

Tim and others need to really start thinking about the long term future. We cannot be be stuck with certain resolution screens and marketing claims which slows AAPL's innovation speed. I of course don't have a good solution to this, but just voicing my concern.

What is there Retina claim? If you look at how they defined it you will see that it's based on someone with 20/20(6/6) vision, which isn't even close to being a majority. With a 264 PPI display you need to hold this 5" device 13" or more from your eyes in order for it be Retina, according to Apple's own definition.

Here's the calculation: 3438 * (1 ÷ 264 PPI ) = 13"

How far would you keep a 5" device from your eyes? I think I average about 18" for my iPhone but I haven't exactly made a scientific study of it.

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post #22 of 123

A cheaper iPhone isn't Apple's only problem. The iOS user interface is getting rather long in the tooth, they need to fix that. Having more than one screen size is also a necessity. Plus, they need to stop selling the older versions. An iPhone 5 with a 4" screen for the low end, and one with AT LEAST a 5" screen on the high end.

 

They might even want to consider adding full phone capabilities to the iPad Mini with the idea that people would be using a bluetooth headset for phone calls.

 

-kpluck

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post #23 of 123
Quote:
Originally Posted by kpluck View Post

A cheaper iPhone isn't Apple's only problem. The iOS user interface is getting rather long in the tooth, they need to fix that. Having more than one screen size is also a necessity. Plus, they need to stop selling the older versions. An iPhone 5 with a 4" screen for the low end, and one with AT LEAST a 5" screen on the high end.

They might even want to consider adding full phone capabilities to the iPad Mini with the idea that people would be using a bluetooth headset for phone calls.

-kpluck

You have completely killed off their $450 to $650 customers and have marketed the $650 to $850 iPhone 5 as being a low-end device. None of that sounds reasonable to me.

As for iOS "being long in the tooth" what exactly is wrong with it? Do you simply want something different each revision for the sake of it being different? I certainly don't. I want something that is more usable with each revision. Why can't we say that Apple got it right with version 1.0 that they haven't had to scrap it and start the OS from scratch few years? Windows Mobile in all its iterations is not how I want my mobile OS evolve. And remember the transition between Mac OS 9 and Mac OS X? I don't want all hassle again. I was happy they finally made the chance because they were at a technical dead end but it still took years for Mac OS X to get well polished. No OS should give all that up simply because some think it's boring because they got it right form the very start.

PS: There is an open source BeOS project which I also don't understand. Why not work on making something useful if you are going to work on an OS?
Edited by SolipsismX - 1/8/13 at 3:28pm

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post #24 of 123
I don't agree with making a larger cheaper phone. Apple's appeal is tha it makes top quality high end products. If it makes a cheaper lower quality product it could affect that imagine long term.
post #25 of 123
Well Forbs says Apple needs to get out of the smartphone business and focus on TV, smarthomes, smartcars and wearable devices. What's really funny is they claim Apple needs to do this because the smartphone market is saturated, yet in the same breath talk about a resurgence from RIM. Er, if the smartphone market is saturated how the hell does RIM make a comeback? lol.gif

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post #26 of 123
Originally Posted by pluck View Post
…one with AT LEAST a 5" screen on the high end.

 

How is this a phone?!

post #27 of 123
So will Apple finally succumb to the "good enough" business model? Will Apple join the "race to the bottom" economic hellhole? Analysts certainly want it to it would appear. How will it be special to own an Apple product if that happens?

All I know is if they do they can no longer count on the traditional loyalty of Apple users. If my Apple product is just another then why even care anymore?

Apple is a business, I know that. They have to make money and profits to satisfy shareholders, I know that. But they WERE something special.
post #28 of 123
Quote:
Originally Posted by lkrupp View Post

So will Apple finally succumb to the "good enough" business model? Will Apple join the "race to the bottom" economic hellhole? Analysts certainly want it to it would appear. How will it be special to own an Apple product if that happens?
All I know is if they do they can no longer count on the traditional loyalty of Apple users. If my Apple product is just another then why even care anymore?
Apple is a business, I know that. They have to make money and profits to satisfy shareholders, I know that. But they WERE something special.

Oh stop, much too early to break into hysterics. You should know if they make a less-expensive phone it'll be the best low-end phone anybody ever saw. Chin up! Have faith!
post #29 of 123
Quote:
Originally Posted by lkrupp View Post

But they WERE something special.

Were equates to when?

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post #30 of 123
That's just BULL! First of all, Apple already has a cheap strategy, it's called previous versions of iPhone. Those can be had for free with contract. Why the hell would they go specifically create a separate line? Not only that, they only create the best product they know how to create. Just like the netbook argument, they don't know how to create a $500 laptop that doesn't suck so they never did. Instead, they created the Air which set the standard.

If they already have a great low cost iPhone why would they create another??? Duh?
post #31 of 123
Originally Posted by JCC View Post
First of all, Apple already has a cheap strategy, it's called previous versions of iPhone. Those can be had for free with contract.

 

"People" demand an iPhone that is $200 off-contract. Don't ask why they demand it or who they are, but they do.


Why the hell would they go specifically create a separate line? If they already have a great low cost iPhone why would they create another??? Duh?

 

Steve's dead.

post #32 of 123
When Apple made the iPad mini they didn't go the cheap route. Yes it's cheaper than the full size iPad but its not a cheap product. If Apple starts going the cheap route then we know Tim Cook has jumped the shark. 1oyvey.gif
post #33 of 123
Originally Posted by Rogifan View Post
If Apple starts going the cheap route then we know Tim Cook has jumped the shark. 1oyvey.gif

 

Bingo.

 

What defines cheap? Is there a single definition?

post #34 of 123
Quote:
Originally Posted by Flaneur View Post


Have faith!

 

 

And the Lord did grin, and the people did feast upon the lambs and sloths and carp and anchovies and orangutans and breakfast cereals and fruit bats...

post #35 of 123
Quote:
Originally Posted by JCC View Post

That's just BULL! First of all, Apple already has a cheap strategy, it's called previous versions of iPhone. Those can be had for free with contract. Why the hell would they go specifically create a separate line?  ...

 

It's only "free" in the US and other places that subsidize phones.  Most of the world doesn't have subsidized phones, and many third world countries cannot afford an unsubsidized iPhone price.

 

Some non-contract Android phones sell for under $125, with more memory, GPS, 3G and faster CPU than the original iPhone.   That's about 1/4 the price of Apple's least expensive iPhone 4 model, and is why some analysts want Apple to come out with a much lower price model in order to grab more of the world's markets. 

 

--

 

Another reason why some analysts want a less expensive model, is that some US and non-US carriers have already stopped giving subsidies, and the fear is that all of them might.  In that case, they think Apple could be in trouble.   Remember, the iPhone didn't really take off in the US until it the 2008 subsidy gave a low $200 upfront cost.

 

If there's no subsidy, its higher price becomes apparent again.   Apple's profit margins could take a huge hit if its prices have to drop to match the competition.   If the price stays high, the sales will take a hit just like in the rest of the world.

 

 (Note that I am not personally arguing about either topic.  I'm just explaining what their thinking is.)


Edited by KDarling - 1/8/13 at 5:02pm
post #36 of 123
Quote:
Originally Posted by zoetmb View Post

Agreed. The screen is probably the most expensive component. So how could it be a larger screen AND a cheaper price? Makes no sense.

Maybe they're using the same crappy, low-budget screens that are so common in Android-ville. /s

Not that I believe the rumor for a second, though.
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post #37 of 123
Quote:
Originally Posted by KDarling View Post

 

It's only "free" in the US and other places that subsidize phones.  Most of the world doesn't have subsidized phones, and many third world countries cannot afford an unsubsidized iPhone price.

 

Some non-contract Android phones sell for under $125, with more memory, GPS, 3G and faster CPU than the original iPhone.   That's about 1/4 the price of Apple's least expensive iPhone 4 model, and is why some analysts want Apple to come out with a much lower price model in order to grab more of the world's markets. 

 

--

 

Another reason why some analysts want a less expensive model, is that some US and non-US carriers have already stopped giving subsidies, and the fear is that all of them might.  In that case, they think Apple could be in trouble.   Remember, the iPhone didn't really take off in the US until it the 2008 subsidy gave a low $200 upfront cost.

 

If there's no subsidy, its higher price becomes apparent again.   Apple's profit margins could take a huge hit if its prices have to drop to match the competition.   If the price stays high, the sales will take a hit just like in the rest of the world.

 

 (Note that I am not personally arguing about either topic.  I'm just explaining what their thinking is.)

Not to sound mean or insensitive, but why would Apple care about market share in third world countries.  I hear this argument repeatedly and it does not make any sense to me.  

post #38 of 123
Quote:
Originally Posted by KDarling View Post

 

It's only "free" in the US and other places that subsidize phones.  Most of the world doesn't have subsidized phones, and many third world countries cannot afford an unsubsidized iPhone price.

 

Some non-contract Android phones sell for under $125, with more memory, GPS, 3G and faster CPU than the original iPhone.   That's about 1/4 the price of Apple's least expensive iPhone 4 model, and is why some analysts want Apple to come out with a much lower price model in order to grab more of the world's markets. 

 

--

 

Another reason why some analysts want a less expensive model, is that some US and non-US carriers have already stopped giving subsidies, and the fear is that all of them might.  In that case, they think Apple could be in trouble.   Remember, the iPhone didn't really take off in the US until it the 2008 subsidy gave a low $200 upfront cost.

 

If there's no subsidy, its higher price becomes apparent again.   Apple's profit margins could take a huge hit if its prices have to drop to match the competition.   If the price stays high, the sales will take a hit just like in the rest of the world.

 

 (Note that I am not personally arguing about either topic.  I'm just explaining what their thinking is.)

The thing that you are not taking into account is that Android phones like the S3 cost almost as much as the iPhone, therefor I don't think this is such a big deal.

post #39 of 123
Quote:
Originally Posted by SolipsismX View Post



I don't know but I keep hearing about how the Asian markets love the size of the Galaxy Note and other such devices because they can have a decent tablet that is still easy to travel with and doubles as a phone.

 

It's funny that the Asian markets supposedly like the iPad mini because of the smaller size (compared to the iPad) but they also like the Note because it's larger than the iPhone.  

post #40 of 123

Smaller cheaper phone yes

 

Larger cheaper phone? Pipe dream.

 

I believe Apple is going to bring an iPhone Mini out this year to take over the low end from the iPhone 4S. 

 

Why? The 4S doesn't have a lightning connector and will become obsolete sooner rather than later. The Mini will cover the space of being the "free" iPhone with a fresh design and the latest connectors for Apple accessories. But it won't be cheap. I would expect the off contract price to still be $399.

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