Apple working on a smaller, contract-free iPhone to combat Android - report

Posted:
in iPhone edited January 2014
Apple is working on a new design and form factor for the iPhone that would allow for a less expensive, contract-free model to take on the competing Google Android platform and bypass wireless carrier contracts, according to Bloomberg.



In a report filed Thursday afternoon, authors Peter Burrows and Greg Bensinger cited anonymous sources in revealing that Apple has allegedly developed a prototype iPhone model that is cheaper and one-third smaller than the current-generation iPhone 4. The report claimed that Apple Chief Executive Steve Jobs "aims to narrow the price gap that has made phones running Android more popular than iPhones" with the new handset targeted for launch in mid-2011.



"Apple has considered selling the new iPhone for about $200, without obligating users to sign a two-year service contract, said the person who has seen it," the report states. It also noted it's possible the project could be delayed or scrapped entirely, as "Apple often works on products that do not later get released."



Bloomberg pinpointed the announcement of the Verizon iPhone announcement in a report filed in June 2010, accurately revealing that the product would become available in early 2011.



Apple's alleged plans, reported on Thursday, would be dependent upon "Universal SIM" technology, which would allow users to switch between GSM networks without having to switch out a SIM card for connectivity to a wireless network.



The Universal SIM would not only cut costs, but would apparently "give Apple an advantage over mobile carriers in influencing customers," Bloomberg's report states. Because the alleged new iPhone model would be available without a carrier subsidy, customers could bypass the terms associated with a two-year contract and phone subsidies, like early termination fees.



"Apple has also worked on redesigned iPhone software that would let customers choose a network and configure their device on their own, without relying on a store clerk or representative of a carrier, according to the person," the report states. To the same end, it also said Apple is working on a dual-mode world phone that would be compatible with both GSM and CDMA networks.



Rumors of an embedded SIM option in future iPhones are not new, surfacing in late 2010 and suggesting that Apple is looking to bypass carriers and contracts, allowing users to select their wireless provider directly from the phone. But it was also rumored that Apple was forced to abandon those plans after carriers allegedly threatened to stop offering subsidies for the iPhone.
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Comments

  • Reply 1 of 132
    Will it allow Flash?
  • Reply 2 of 132
    jd_in_sbjd_in_sb Posts: 1,600member
    This follows their iPod strategy of having a model for all price points.
  • Reply 3 of 132
    "the report states. It also noted it's possible the project could be delayed or scrapped entirely, as "Apple often works on products that do not later get released."



    Lol - nothing like hedging your bets.
  • Reply 4 of 132
    Quote:
    Originally Posted by rdjlexky View Post


    "the report states. It also noted it's possible the project could be delayed or scrapped entirely, as "Apple often works on products that do not later get released."



    Lol - nothing like hedging your bets.



    That line just about says it all.



    Not worthy of AI's red-letter font.....



    (Notice that the font's gone.... perhaps I imagined it?!)
  • Reply 5 of 132
    Does the price of the handset really matter anymore? I see the cost of the data plans being the thing that is holding the mainstream buyer back. Apple needs an iPhone you can purchase without a data plan, for the huge number of people who won't pay for data and would be happy to use the phone in WiFi.



    I know alot of people will say this is crazy and "who would buy an iPhone without data?", but I think we are in the minority. Compare the number of people who have text plans and the number who have data - huge difference.



    I know there is a $15 option at AT&T for a small amount of data, but they need a $0 option - just like the quick messaging phones.



    Don't get me wrong, we need our regular iPhone plans too (I have had one since they came out), but I know ALOT of people who just wont pay for the plans.
  • Reply 6 of 132
    mstonemstone Posts: 11,510member
    Do the carriers charge you any less when your contract expires? No until they offer a reduced plan for people who own their phone all you are going to save is $200. Everyone know the real cost of having a cell phone is the minutes, data plan and txt, not so much the cost of the phone.
  • Reply 7 of 132
    I had wondered when they'd do this.
  • Reply 8 of 132
    Quote:
    Originally Posted by aross99 View Post


    Does the price of the handset really matter anymore? I see the cost of the data plans being the thing that is holding the mainstream buyer back. Apple needs an iPhone you can purchase without a data plan, for the huge number of people who won't pay for data and would be happy to use the phone in WiFi.



    I know alot of people will say this is crazy and "who would buy an iPhone without data?", but I think we are in the minority. Compare the number of people who have text plans and the number who have data - huge difference.



    I know there is a $15 option at AT&T for a small amount of data, but they need a $0 option - just like the quick messaging phones.



    Don't get me wrong, we need our regular iPhone plans too (I have had one since they came out), but I know ALOT of people who just wont pay for the plans.



    Apple does make an iPhone without a data plan - AT&T just doesn't sell it. I can detach my data plan from my Telus iPhone at any time.
  • Reply 9 of 132
    The iPhone Nano rumor rears it's head again.
  • Reply 10 of 132
    Quote:
    Originally Posted by aross99 View Post


    I see the cost of the data plans being the thing that is holding the mainstream buyer back.



    I know there is a $15 option at AT&T for a small amount of data, but they need a $0 option - just like the quick messaging phones.



    Don't get me wrong, we need our regular iPhone plans too (I have had one since they came out), but I know ALOT of people who just wont pay for the plans.



    The cheapest data plan is $15 per month, the cheapest voice plan is $40. Actually, they do have cheaper voice plans, but not for iPhone users. It's hard to see the data plan as the problem when voice is almost three times as expensive.
  • Reply 11 of 132
    noirdesirnoirdesir Posts: 1,027member
    Quote:
    Originally Posted by aross99 View Post


    Does the price of the handset really matter anymore? I see the cost of the data plans being the thing that is holding the mainstream buyer back. Apple needs an iPhone you can purchase without a data plan, for the huge number of people who won't pay for data and would be happy to use the phone in WiFi.



    I know alot of people will say this is crazy and "who would buy an iPhone without data?", but I think we are in the minority. Compare the number of people who have text plans and the number who have data - huge difference.



    I know there is a $15 option at AT&T for a small amount of data, but they need a $0 option - just like the quick messaging phones.



    The price of the handset matters almost everywhere except in the US where nobody ever sees the true handset price. And the dataplans are only so expensive because they have to pay back the subsidy.

    In Europe, the iPhone 4 is sold for around 630/740 Euro (that includes sales tax/VAT and thus it varies a bit from country to country).

    In Germany, you can get a 100 MB/month plan for 4 Euro. And for a lot of people, if they pay attention (no podcasts/apps downloading/streaming over 3G), most web services (e-mail, light serving, most apps that just fetch small amounts of data) can be covered by this. And going to 10 Euro/month gets you to 1 GB.

    If you have a month-by-month 4 Euro data contract, the difference between 600 Euro and 200 Euro does really matter.

    (And these data plans include voice, just with zero minutes.)
  • Reply 12 of 132
    This isn't gong to happen.

    Apple has already proved it didn't need a large Market share to make a big profit with the mac and iPhone so it would feel like a step backwards to aim at a lower end portion of the Market.

    And I don't like the iPod analogy it isn't relevant. Just thing about the apps who won't work (or as well) with a new screen size.

    They can do some testing for sure but it doesn't mean they'll release it. This is where they are differen from microsoft; they make sure they have a strong strategy and a perfect product. They don't want to damage sales of the more expensive iPhone. Remember the 7inch iPad?
  • Reply 13 of 132
    noirdesirnoirdesir Posts: 1,027member
    Quote:
    Originally Posted by mstone View Post


    Do the carriers charge you any less when your contract expires? No until they offer a reduced plan for people who own their phone all you are going to save is $200.



    Well, in most countries where you have multiple carriers competing with the same technology (ie, GSM/UMTS), you can get plenty of much cheaper plans if you don't need a subsidy (ie, loan) for your handset.

    Have a look at this graphic, you can clearly see that the biggest part of the total cost is in the handset price:

  • Reply 14 of 132
    Quote:
    Originally Posted by noirdesir View Post


    The price of the handset matters almost everywhere except in the US where nobody ever sees the true handset price. And the dataplans are only so expensive because they have to pay back the subsidy. ...



    The data plans are so expensive because U.S. carriers don't compete on price. It doesn't have anything to do with "the subsidy".
  • Reply 15 of 132
    AND THE IPHONE NANO NONSENSE RETURNS.



    What did you expect? The Verizon iPhone exists. The iPhone nano is OBVIOUSLY going to happen. Simultaneous release with the xMac.
  • Reply 16 of 132
    So Apple wants to be a volume manufacturer now like Nokia, Samsung, Motorola, etc. for the sake of marketshare? Jeez Apple you rake in 51% of all mobile phone profits despite a 4% marketshare. I thought you'd rather take that stats over marketshare.
  • Reply 17 of 132
    noirdesirnoirdesir Posts: 1,027member
    Quote:
    Originally Posted by anonymouse View Post


    The data plans are so expensive because U.S. carriers don't compete on price. It doesn't have anything to do with "the subsidy".



    But if they had to compete on price, they also would have to compete on the amount of subsidy they pay. As long as they can charge what they want, they have no real pressure to reduce the subsidy.
  • Reply 18 of 132
    cpr1cpr1 Posts: 41member
    Quote:
    Originally Posted by aross99 View Post


    Does the price of the handset really matter anymore? I see the cost of the data plans being the thing that is holding the mainstream buyer back. Apple needs an iPhone you can purchase without a data plan, for the huge number of people who won't pay for data and would be happy to use the phone in WiFi.



    I know alot of people will say this is crazy and "who would buy an iPhone without data?", but I think we are in the minority. Compare the number of people who have text plans and the number who have data - huge difference.



    I know there is a $15 option at AT&T for a small amount of data, but they need a $0 option - just like the quick messaging phones.



    Don't get me wrong, we need our regular iPhone plans too (I have had one since they came out), but I know ALOT of people who just wont pay for the plans.



    I agree. I don't want to pay $360/yr. for a data plan. I don't want an iPhone -- I want a WiPhone. And maybe, like the iPad, give me the option of a month-to-month data plan (in case I'm on the road for an extended period).
  • Reply 19 of 132
    Makes sense to me. It is a small step to add phone capability to the iPod Touch and sell them at the same prices as they do now. A contract free phone, even if it uses a MVNO set up by Apple on Sprint or T-Mobile could fill a niche and spur sales of iPod Touches even further.
  • Reply 20 of 132
    If there were a wifi only iPhone me and my wife would already have them. The $30-$60 extra in data is something we just haven't accepted. We need phones, but we do not need internet everywhere we go. wifi is pretty much everywhere, and would be good enough for me.



    So for me we've been using the shittiest dumb phone's we could find supplemented with itouch's
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