Apple Would Never Make a “Cheap” iPhone, One Exec Says

Apple's iPhone 5 | Apple Official Website

Apple’s iPhone 5 | Apple Official Website

After being asked about the possibility of a low-cost iPhone, Apple’s Marketing Chief Phil Schiller said that the company is not interested in manufacturing such a handset model.

However, the exec’s comments will not guarantee the iPhone maker’s next move regarding the smartphone. It should be recalled that Apple also panned smaller, less expensive tablets prior to the release of iPad Mini in October 2012.

Meanwhile, Schiller’s response came in at the heels of recent reports, which claims that the company wants to release a low-cost iPhone this year. It is said that the device is gearing towards emerging markets like China.

In relation to this, the marketing chief said that basic “feature” phones were initially popular in the Chinese market. “Cheap” smartphones, on the other hand, are the most successful as of the moment. However, Schiller pointed out that Apple won’t go down the same path.

Despite the popularity of cheap smartphones, this will never be the future of Apple’s products. In fact, although Apple’s market share of smartphones is just about 20 percent, we own 75 percent of the profit.

Addressing Big Part of the Smartphone Market

In another news, Gene Munster of Piper Jaffray suggested that a low-cost iPhone could address 65 percent of the smartphone market. The said market share is comprised of smaller, less expensive handsets popular in China and Brazil. The analyst also pointed out that a low-cost iPhone could generate $6.5 billion in revenue at the end of the year alone.

Rumors of a more affordable iPhone geared toward emerging markets gained traction this week. This is when The Wall Street Journal reported that Apple is working on a new iPhone, which could hit the market within the year. It is said that the company’s interest was in response to the growth of Android handsets in the low-end market.

As reported by Apple-centric website AppleInsider last week, the cheaper unit may take on the form factor and design of the existing model, while its chassis is made from less exotic materials like polycarbonate. Other parts could “remain the same or be recycled from older iPhone models.”

Rumors of a low-cost iPhone to be sold without a contract are not new. However, Apple has opted to keep the previous models and sell them at a lower price.

As of the moment, Apple’s least expensive unit is iPhone 4, which costs $450 without a contract in the US. The same option is available in China and Brazil at $490 and $750 respectively. That’s because taxes are added.

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