Apple Preparing Cheaper iPhone – Report

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Apple is apparently working on a lower-end iPhone to compete with cheaper alternatives

Apple is reportedly working on a cheaper, lower-end version of the iPhone to help it compete with rival smartphone manufacturers who have eroded its share of the worldwide market.

The Wall Street Journal reported that Apple has been exploring the idea since 2009, but is now close to implementing its plans after seeing its share of global smartphone shipments slide to just 14.6 percent in the third quarter of 2012.

The iPhone 5 was unveiled in September and was released late last year. It remains popular in the US, but it has struggled in China and emerging markets.

Cheaper iPhone possible

It has been suggested the design of the cheaper smartphone would resemble that of a standard iPhone, but with a cheaper casing. The iPhone 5 is currently housed in aluminium, but this could be replaced by polycarbonate plastic. Internal components could remain the same or could even be recycled from previous models.

Prior to the launch of the iPhone 4 in mid-2010, Apple apparently developed a design for cheaper phones that looked similar to the iPhone at the time, but the idea was shelved as the Cupertino-based company was concerned that multiple smartphones would complicate the manufacturing process. Another concern is that it could affect Apple’s high profit margins.

Rival manufacturers like Samsung offer cheaper alternatives alongside their flagship smartphones, a strategy that Apple could be prepared to replicate. It launched a smaller 7.9 inch version of its iPad tablet, the iPad Mini, in order to compete with cheaper seven-inch alternatives from the likes of Amazon and Google.

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