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Summary:

The WSJ says sources confirm Apple is considering building a less-expensive iPhone out of plastic with older components by the end of this year. Such a move would be a pretty huge change in strategy for Apple and its most important product.

iphone camera
photo: jesus-leon

Stop me if you’ve heard this before: Apple is working on a cheaper iPhone. This report, however, has a bit more detail than previous dispatches: The Wall Street Journal reported Tuesday that Apple is considering selling an iPhone made out of cheaper materials to sell a device to a broader audience. The timetable for launch is said to be as early as the end of 2013.

According to the report, “One possibility Apple has considered is lowering the cost of the device by using a different shell made of polycarbonate plastic. Many other parts could remain the same or be recycled from older iPhone models.”

Such a move would be a pretty huge change in strategy for Apple and its most important product. Apple has always introduced just one new model of iPhone per year, while keeping around older models at discounted prices. It has not offered multiple new iPhone models for different price ranges in the same refresh cycle.

Apple technically already sells a cheaper iPhone: the iPhone 4, and iPhone 4S. And they’re doing very well, even while being sold alongside the iPhone 5. A report from Kantar Worldpanel Comtech released Monday found that between mid-October and the end of November, older iPhones, both the iPhone 4 and iPhone 4S, represented a higher proportion of device sales from carriers than the brand-new iPhone 5, by a margin of 57 percent to 40 percent.

Making a lower-quality device with older parts would make the device more affordable for the growing markets that Apple wants to target. But it also doesn’t seem to fit with Apple’s general plan. That’s something that the company’s leadership seemed to confirm several years ago: In early 2011, CEO Tim Cook was calling cheaper iPhones “a category killer.”

But as cheaper Android models are seeing huge success in emerging markets like China that Apple has to have; perhaps Cook has had a change of heart.

Image courtesy of Flickr user jesus-leon.

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  1. I think they will do it. Strong advantages:
    1) Selling Apps, iCloud after market.
    2) Apple can negotiate cost reductions on old components.
    3) Increased clout with emerging mkt Mobile Service providers.
    4) Get Wall Street comfortable with lower margins, competition from Android.
    5) Gateway to iPad sales in emerging markets.

  2. Here is a crazy idea. Why not just drop the prices for the phones that they already make? Samsung and other companies make phone with superior tech, specs, and OS and they don’t charge the inflated prices of a phone that might have been competitive 2 years ago.

    1. You’re nuts. You get what you pay for. I have a Nexus 7 broken screen after two weeks. The construction quality and the components make a big difference in price. Corning Fit vs Gorrila Glass. Get on youtube

      Check the resale value of both devices I got $294 for my iPhone 4S 32GB when I moved up to iPhone 5. I got nothing for my Evo

      iPhone 5 vs Samsung Galaxy S3 Drop Test

      iPad mini vs Nexus 7 – Drop Test!

      But with Steve Jobs dead and no one as anal retentive with attention to detail and focus Apple is on the way down.

      You can’t keep making variations of what you’ve already done and keep expecting people to buy.

      1. You get what you pay for with an iPhone?? Job’s attention to detail?? What world do you live in? Did you drink too much of the Apple Kool-aid? Do you remember the iPhone 4? It never even made it into consumer reports as a decent phone. If Jobs had any kind of attention to detail he would have saw the problems with the antennae but instead he tell everyone that they are holding their phones wrong. Now the iPhone 5 is released and the thing gets scratched up if you look at it at the wrong angle and removing Google Maps was a stroke of genius, right? Don’t make me laugh. In fact I laugh when I see you iSheep buying you used phones that Apple has convinced you are actually worth something.

    2. If Apple has to sell a cheaper phone, I think that’s the way to go.

  3. “between mid-October and the end of November, older iPhones, both the iPhone 4 and iPhone 4S, represented a higher proportion of device sales from carriers than the brand-new iPhone 5, by a margin of 57 percent to 40 percent.”
    Not sure where you got this from ,can’t find that in anything Kantar made public, is it in any way accurate, is it worldwide or US, those numbers are rather odd.

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