There have been quite a bunch of Apple rumors lately for unknown reason. I mean usually you would expect rumors when there is an upcoming Apple event (WWDC, etc), but there is really no hints of one coming up soon.
First, there is that article from WSJ about Apple cutting back on orders for iPhone 5 parts. Of course, the analysts came out from the woodwork, talking crap about weak demand. Who knows the real intention, or whether it is true or not, but one can simply go to Apple.com and see that Apple now has enough stock for the iPhone 5 to ship. I mean the phone has been on the market for almost 5 months already, and looks like Apple caught up with the demand, so obviously orders would be pared down as to not create overstock. We are talking about Tim Cook here, he knows what he is doing, better than those analysts.
Second is the revival of a cheaper iPhone rumor. Anybody that knows Apple would know that Apple is not interested in race-to-the-bottom. They skipped the netbook craze, went with the iPad and Macbook Air, and they are raking in the dough while other PC OEMs are now struggling.
Having said that, I have also been ranting about the unlocked prices of iPhones. I am not saying that Apple need to make some cheap bottom barrel iPhone, but some price cuts would be great. The cheapest iPhone right now is the 8GB iPhone 4, which sells for $450 unlocked. Compare that to the latest Nexus 4, 16GB for $349. Now, knowing what Apple has been doing in the past, and the fact that the iPhone 4 is still performing adequately under iOS6, we can see the usual shift of models when a new iPhone is announced. Ie, price drop by $100 across the board. This means the iPhone 4 will be $350. If Apple could push that down a bit more to $300, now we have the so-called “low cost” iPhone. Other than the Nexus 4, most Android phones in this price range has poorer user experience (slow hardware, old outdated OS, cheap material, etc). The iPhone 4’s industrial design alone is superior, despite the outdated internal (A4 chip). This move makes more sense, and it is what Apple has been doing in the past. To be more radical, I can see Apple updating all lineup with lightning connector.
When the analysts are talking about “low-cost” iPhone, they are talking about $200 phone unsubsidized. The Android experience at this price range is just bad, mostly phones with really really old hardware (~2008 era, first gen snapdragon). There is a new contender though, Nokia’s Lumia 620. It is not sold in the US, but it is available from import stores for less than $300. Counting how much import stores jack up the original MSRP, one can think the actual price would probably be closer to the $200 range. What’s special about the Lumia 620? Well, it runs the latest Windows Phone 8 (compared to the competing Android phones where some are still running Gingerbread in this price range), and it has dual-core Krait, the latest chipset. It may not have super duper 1080p screen, but its WVGA 3.8″ screen with Nokia’s “ClearBlack” is decent, considering the price range. So now the rumors are running wild about a plastic iPhone. Many refers back to the 3G/3GS style.
Although personally I still believe Apple would not do this (probably just do a price cut on the iPhone 4), it is more fun to speculate, no? 😀
To see how a “low-cost” iPhone would be, easiest way is to see the iPod Touch lineup, as Apple does have a $200 iPod Touch. Currently though, that iPod Touch runs the A4 chip with paltry 256MB RAM and poorer quality retina screen. However, clearly Apple can afford to sell an A5 equipped new iPod Touch, complete with a same screen as the iPhone 5, for $299. That would be a good starting point to speculate.
First, internal hardware. Although A4 is probably cheaper, and as shown with the iPhone 4, with enough RAM, it can still perform well, I would go with the A5. Apple loves the A5, putting it in the new iPod Touch and the iPad mini. Plus they can probably make those for cheap now. With the A5, comes the benefit of Siri, which imo what Apple would/should want to push at this point. The iPhone 4 doesn’t have Siri.
Screen wise, it would be the same as iPhone 4/4S retina screen. For body, although it’s tempting to bring back the 3G/3GS plastic, we know Jony Ive won’t like that. I’m guessing it would have the new design similar to the iPad mini/new iPod Touch. Apple doesn’t seem to have a problem putting LTE radio on the iPad mini using the design.
So, it’s pretty much a smaller screen iPod Touch with a phone in it. But then what about the 4S? What I can see Apple do is pretty much getting rid both the 4 and 4S (both still sporting the old 30-pin dock connector) with the new model with lightning connector. A complete makeover so all the lineup uses the lightning connector. Price? Again, Apple is about healthy profit margin. I doubt they would ever do a $200 unsubsidized iPhone unless the margin is good. Heck, they are still selling the old A4-based iPod Touch because they can’t price the newer one to $199. So this “cheaper” iPhone will be at the current iPhone 4 price point, with the iPhone 5 taking over the 4S slot and the next iPhone as the new top of the line (A7 powered, same design as the current iPhone 5 with improved materials so it won’t self-scuff inside its box).
So let’s recap. My speculation would be no more iPhone 4 nor 4S. The low end will be the iPhone using the latest iPad mini/iPod Touch design cues with 3.5″ retina screen (same screen as the 4/4S), A5 powered, 512MB RAM, same cameras as the current iPod Touch, lightning connector, starting with 8GB at $399 ($400 with a marketing spin) unsubsidized, and 16GB at $450. Next up will be the the current iPhone 5 at 16GB for $550, then the new iPhone at 16GB for $650, and so on. If Apple want to be a bit more aggressive, they can start the new iPhone at 32GB for $650.
But, I think Apple will stick to the usual pattern like I mentioned at first, iPhone 4 dropping down in price to $350, 16GB iPhone 4S taking over the $450 spot, current 16GB iPhone 5 at the $550 spot, and the new iPhone at $650 and up.
See, I can be an analyst too. 😛 The difference is I don’t get paid making ridiculous speculations.