A cheaper iPhone on the horizon for later this year – hello iPhone mini

9 Jan 2013

The iPhone 5

Expectations that Apple may launch a cheaper iPhone are on the rise and new reports suggest that in order to address a decline in its supremacy in the smartphone market against Google’s Android ecosystem and Samsung, the Californian tech firm may bring out a lower-cost device later this year.

Last week, we reported how Strategy Analytics analyst Neil Mawston predicted Apple will need to enter the lower-cost smartphone segment in order to arrest the growth of rivals, such as Samsung.

Mawston predicted Samsung will sell 290m smartphones in 2013 while Apple will sell 180m iPhone devices.

Last night, the rumour mill went into overdrive after The Wall Street Journal reported that Apple has been progressing a plan to produce a less expensive version of its flagship device, as early as later this year.

However, rather than producing a smaller version – an iPhone mini – The Wall Street Journal report suggests Apple may produce a version of the iconic iPhone in a less expensive body.

Expecting a plastic iPhone?

The notion of a plastic iPhone may horrify die-hards and fanbois, but many of the devices the iPhone competes against – most notably those made by Samsung – aren’t made of glass and aluminium but materials like polycarbonate plastic.

However, if Apple does go down this road to capture more and more consumers in existing and emerging markets, it does mark a seismic shift in the company’s approach. Apple traditionally focused on making high-end, expensive products with an uncompromising approach to quality.

The introduction of the iPad mini in October proved however, that Apple can still enter markets dominated by lower-priced rivals and continue to produce attractive, high quality products.

The smartphone segment isn’t the only area where Apple will face mounting competition in 2013. This week at CES, Intel revealed its fourth-generation Intel Core Processor is ready to kickstart a whole new generation of lower-priced ultrabooks with touchscreen capability.

Herein lies another area in which Apple will need to take defensive action to maintain its edge – after all, it kickstarted the ultrabook genre with the MacBook Air – so could we also see eventually lower-priced versions of Mac products?

Returning to the iPhone which accounts for almost half of Apple’s revenues, it has been a consistent performer for Apple since the iPhone debuted in 2007.

Apple has proven with the iPad mini that it can maintain quality and enter lower-priced segments. The trick will be producing a device that is affordable and maintains the high standards Apple has set for itself and the computing industry at large.

The iOS platform is an impressive computing environment, superior in a lot of respects to Android. It makes sense that more people around the world will get to enjoy it.

If Apple succeeds in creating a device that in terms of price competes against other smartphones from Samsung, LG and Sony, it will force the others to dig deeper.

The winner: the consumer. The way it should always be.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years