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Apple to deliver a new Entry-Level iPhone (less expensive model), rendering Apple more Competitive with iPhones deliverable to a world-wide audience – Maybe More Fact than Fiction ⭐⭐⭐⭐⭐📍📍

May 8, 2013

Apple to deliver a new Entry-Level iPhone (less expensive model), rendering Apple more Competitive with iPhones deliverable to a world-wide audience – Maybe More Fact than Fiction

We have been hearing rumors for years that Apple may be working on an “entry level” (a/k/a budget) iPhone. Whether its true or not remains to be seen; however, at the same time some are saying that this makes sense as it will help Apple appeal to consumers on a budget, but just how big of an appeal is it?

Well according to analysts Gokul Hariharan and Mark Moskowitz at J.P. Morgan, they seem to believe that if Apple were to release an iPhone that costs around $350-$400, there is a good chance that they will be able to acquire a relatively large segment of market-share from Samsung who is currently dominating the $200-$500 market at 35%.

It was reported yesterday (Tuesday May 6, 2013) that the iPhone has now become Number-One PHOTO capturing device (camera), based on the number of images posted on Flicker, Facebook and all the other major internet image publishing domaines. Personally, I must confirm that Marilyn and I take a lot of iPhone-5 pictures, and the Camera within this “phone” is quite amazing. We are very appreciative that Apple is spending lots of its enginering and design talent in developing even better imagers and lenses for future iPhones. This factor alone is a serious motivator for me in Updating to the next iPhone iteration…

The rumors that Apple is preparing several different new iPhone models for release this fall gained more steam on Wednesday. Morgan Stanley analyst Katy Huberty said in a research note that Apple suppliers are planning to start building the new models in June and July. Per AppleInsider, Huberty reports that after meeting with multiple Apple component suppliers in Asia, she believes Apple will start manufacturing both a low-cost iPhone and the iPhone 5S over the summer for a likely release date in September. Huberty also says that carriers expect Apple to increase its iPhone shipments over the long haul not only with a low-cost iPhone in the fall but eventually also with a larger 5-inch model that would pit Apple directly against such noted “phablet” vendors as Samsung and LG.

So what’s the Beef… Recall that in the USA market, AT&T for example subsidizes each new 2-year contract signer for iPhone5 at the rate of $450 for an iPhone5, and the customer pays $200. The math is quite simple. If the new iPhone is acquired by a customer at an AT&T store then, AT&T collects $200 from the customer, the customer signs a 2-year contract for cellular service, and AT&T pays Apple $650 for every iPhone5 delivered by or throuth AT&T.

So in effect with AT&T’s subsidy of $450, for a 24 month agreement, this equates to about $20/month that is built-into your cellular services bill. And is one of the primary reasons that AT&T and the other providers charge subscribers large Early Termination fees, which reimburses the provider, as it is out of pocket $450 from day-one, in your behalf.

Here is the rub, if you are an Asian customer, the Aisan cellular providers do not offer the attractive $450 subsidies that US providers offer US customers for their new 2-year signers. An obvious solution is for Apple to engineer a less expensive iPhone for entry-level buyers, and for Aisan clients and others over-seas, that want an iPhone but are crowded out by the lack of an adquate over-seas-cellular-providers.

Considering the appeal that iPhones have, we guess it would be possible for Apple to acquire a portion of the market share, particularly if the iPhones were made less expensive, rendering the iPhones more affordable.

In my humble opinion, a more affordable iPhone would definitely help Apple gain a significant piece of the market-share, thereby giving Samsung more competitive struggle. Its not necessarily all about the Money; but, enough time has passed, where there seems to be a price-blockage, due to the less-agressive over-seas subsidies for new contract signers.

Bottom Line: One thing seems relatively clear, if Apple wants a larger piece of the over-seas Smart-Phone market, and maybe an even bigger slice of the USA market-pie, Apple needs to add to its iPhone product line, an “Entry Level” iPhone.

Providing an “Entry Level” iPhone is really not about “buying” market share; its a matter of providing a “stepping stone” to a very sizable group of potential-Apple customers. Once they try the an “Entry Level” iPhone, Apple will have them for a very long time, due to Apple’s very extensive ecosystem of their exquisite iOS, the Apps, the Attachments, Apple Care.

While we are spreading rumors, lets celebrate the iPhone 5 with its 4″ retina display, and add another iDevice called the iPhone6 with a 5″ retina display; I’d even be willing to pay say $50 or so more for this larger display. Why not, I pay up $200 extra for storage memory upgrades for all 4 of our iPhones and iPads.

Perspective: Rumors. What do they mean. To some, rumors are authentic wispers of truth from people that are in the know. To others rumors are complete fiction and the food for fools; and then there is everything in between. This chatter can be interesting. We pass the most interesting bytes for you. What do you think? Be free to comment below. In reality, “The people that are in-the-know, don’t talk; and the people that really don’t know, talk.”

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