Originally Posted by gwmac
If Apple can make a 32GB iPod touch for $299 and presumably make their profit margin, there is no reason why they couldn't make a cheaper iphone with maybe even less memory of around 8 or 16 GB and not make similar margins. Whether they choose to do that or not is up to them and I really don't have a dog in that race as it wouldn't effect me. But I don't think it would be a bad decision at all if they chose to offer a product in the largest market segment where they currently aren't really competing.
The thing about these super cheap Android phones is they get people into the ecosystem. They get people familiar with Google apps and how to feel comfortable using an Android phone. When these people upgrade their phones and have more money to afford more expensive models they will probably stick with Android because that is what they are familiar using. Apple would be smart to offer a cheaper alternative to get them into the iOS ecosystem.
By not including LTE and using older specs they could make a very nice phone at a reasonable price and still make their typical margins. But the real reason to do this would be to give that customer a good reason to buy the regular iPhone model later down the road.
As I've posted in other threads, I think the key is to look at who would be buying these phones -- and why?
I suspect that for many emerging [technology] countries a smart phone is a major purchase... and it may be the first/only "personal computer" available to that person or home/family.
If Apple can make the iPad Mini into a useable phablet with Voice/Texting (BT mic/earphone or hold to ear in a pinch) -- I think that the iPad Mini would be a better choice for many of the above people.
The iPad Mini is already price competitive *
- $459 iPad Mini WiFi + Cellular --16 GB A5
- $549 unlocked iPhone 4S --16 GB A5
- $450 unlocked iPhone 4 -- 8 GB A4
If you could afford/choose only one -- which would it be?
I suspect that there will be 2 refreshes of the iPad Mini in 2013 -- and the current 16 GB WiFi Cellular model will be sold at $199-$249
* High import tariffs for countries like Brazil can be address by doing some manufacturing, assembly, distribution, support within those countries.
Edited by Dick Applebaum - 1/10/13 at 10:07am