Apple to sell low-cost iPhone for $350, new iPhone end of Summer

It seems like the low cost iPhone rumor is one that will never truly go away. Each year around the time of a new iPhone launch, rumors surface about Apple launching a lower-cost iPhone.

BGR is reporting that Apple will have a low cost iPhone, to the tune of $350.00 without contract, but it may not even be a new phone. BGR states that the low cost pre-paid iPhone could be the iPhone 3GS. It is also being reported that Apple will continue to sell the iPhone 4 alongside the iPhone 5 and the new low-end/prepaid iPhone 3GS.  If Apple does go this route, they will now have phones in all price categories from the low-end to the premium market.

The final bit of information that BGR still stands by is that there will be a redesigned iPhone coming in late August timeframe, but it is not sure if it will be the iPhone 5 or an iPhone 4 derivative. Either way, a new iPhone will be coming later this summer, but which path Apple will be taking it down is still uncertain.

If Apple does begin to sell an iPhone in all three pricing categories, it will be the final peg in their mobile phone strategy. Apple will employ the waterfall effect with each generation: The device will go from premium to mid-market to low end and allow Apple to play a card in each segment.

Report a problem with article
Previous Story

HTC shares plummet due to Apple lawsuit loss

Next Story

Windows Phone tops Android in "Very Satisifed" users, both lag behind Apple

37 Comments

Commenting is disabled on this article.

sorry what $350??? I don't exactly call that Low Cost now less than $200 would be low cost in my book.... Yes I know they still have to make a profit but for something that cost them maybe around $10 to manufacture then $350 is way over priced

So that's why analysts predict Apple will sell 100 million iPhones in the next year. No way they were going to sell 100 million iPhone 5s.

KingCrimson said,
So that's why analysts predict Apple will sell 100 million iPhones in the next year. No way they were going to sell 100 million iPhone 5s.

If Apple can produce 100M iPhone 5s they can sell them like hot cakes.

Apple iPhone 5 In Hands Of AT&T For Beta Testing

According to ChipHazard's well placed sources in AT&T mobility division, it has come to our attention that the next generation iPhone, presumably dubbed as the iPhone 5, is now in the hands of 3rd party beta testers, which are carrying out rigorous tests before the final green signal is given for mass production. According to our information these devices were handed over to AT&T beta testers on July 6th.....

http://www.chiphazard.com/2011...for-beta-testing-exclusive/

alexalex said,
Apple iPhone 5 In Hands Of AT&T For Beta Testing

According to ChipHazard's well placed sources in AT&T mobility division, it has come to our attention that the next generation iPhone, presumably dubbed as the iPhone 5, is now in the hands of 3rd party beta testers, which are carrying out rigorous tests before the final green signal is given for mass production. According to our information these devices were handed over to AT&T beta testers on July 6th.....

http://www.chiphazard.com/2011...for-beta-testing-exclusive/

Signal being the operative word, hopefully the next iteration of the iphone doesn't drop it.

DrCheese said,
The headline is missing a ? or a "rumoured to", it looks like it's presented as fact otherwise

Yeah this is just a rumour and not a fact.

DrCheese said,
The headline is missing a ? or a "rumoured to", it looks like it's presented as fact otherwise
Just what I was thinking. I wouldn't have clicked on it otherwise so I guess thats why.

That sounds like a horrible strategy. Considering apple already EOL iPhones after 2 years - who really wants an iPhone that is unlikely to ever receive a software update? Consumers will still expect it because it was a top of the range iPhone at one point.

Now if they produced a different apperance (with perhaps the 3GS internals) and called it something like the iPhone Mini, they would have different expectations.

Oh and the 3G/3GS was the weakest design of all the iPhones, and now over 3 years old.

Nero3000 said,
That sounds like a horrible strategy. Considering apple already EOL iPhones after 2 years - who really wants an iPhone that is unlikely to ever receive a software update? Consumers will still expect it because it was a top of the range iPhone at one point.

Now if they produced a different apperance (with perhaps the 3GS internals) and called it something like the iPhone Mini, they would have different expectations.

Oh and the 3G/3GS was the weakest design of all the iPhones, and now over 3 years old.

if they are marketing, and still producing a phone for the low end market then i'd imagine updates will follow, they just wont have the feature set of the high end iphone 4/5. They usually stop releasing updates when they want to EOL something, if they don't want to end it's life then they will need to give updates..

Nero3000 said,
Considering apple already EOL iPhones after 2 years - who really wants an iPhone that is unlikely to ever receive a software update?

iOS 5 is compatible with the 3GS model.

Manish said,

iOS 5 is compatible with the 3GS model.

And iOS3 was compatible with the original iPhone, with some features missing (bluetooth profiles, tethering, MMS).
And iOS4 was compatible with the iPhone 3G, with some features missing (mulitasking, wallpaper, keyboard support).

So nothing out of the ordinary, Apple will give a two year old device a limited update (sometimes artificially). To apple's credit, iOS 5 does not seem to be as limited with the 3GS as was with previous releases on the relevant hardware. But, will the 3GS get anymore functionality updates? (i.e. those that add siginigicant end user features, rather than security updates)

Nero3000 said,
who really wants an iPhone that is unlikely to ever receive a software update?

Anyone that's now happy with Android won't have a problem with an iPhone that get's no updates… For the average Joe updates aren't important at all…

Nero3000 said,
That sounds like a horrible strategy. Considering apple already EOL iPhones after 2 years - who really wants an iPhone that is unlikely to ever receive a software update? Consumers will still expect it because it was a top of the range iPhone at one point.

Now if they produced a different apperance (with perhaps the 3GS internals) and called it something like the iPhone Mini, they would have different expectations.

Oh and the 3G/3GS was the weakest design of all the iPhones, and now over 3 years old.

+1000

But it will work perfectly for Apple. The average consumer will not know that the iPhone 3GS will be EOL with iOS5 when the iPhone 5 is released. I would like Apple to release multiple phones at a time instead of piggybacking off older models.

JamesWeb said,
I wouldn't call $350 the "low end" of the market.

Why not? Mind you that $350 is unsubsidised, on a subsidy, that could easily be $0

It always boggles the mind when I hear people talking about me that i'm crazy for spending $500 on a phone yet they get raped every month by Verizon & AT&T spending close to $100 a month! My plan is $50/month so in the end i say $1100 after 2 years (most of the time i'd already moved on to another $500 phone while they still got that same clunker!)

SHoTTa35 said,
It always boggles the mind when I hear people talking about me that i'm crazy for spending $500 on a phone yet they get raped every month by Verizon & AT&T spending close to $100 a month! My plan is $50/month so in the end i say $1100 after 2 years (most of the time i'd already moved on to another $500 phone while they still got that same clunker!)

How is your plan only $50/month? Do you get unlimited data or some cap?

It's just one of those prepaid plans - Unlimited Voice/Text - Data is only 100MB however but i'm always in WIFI (Work, ISP covers main streets, Home) so i don't really use it that much. For driving then yeah but quick checks or pulling map data don't suck down that much. No streaming radio or none of those things.

Here's the kicker however, I get all that for $50 but it's still using AT&T's network

SHoTTa35 said,
It's just one of those prepaid plans - Unlimited Voice/Text - Data is only 100MB however but i'm always in WIFI (Work, ISP covers main streets, Home) so i don't really use it that much. For driving then yeah but quick checks or pulling map data don't suck down that much. No streaming radio or none of those things.

Here's the kicker however, I get all that for $50 but it's still using AT&T's network


Only $50 a month on top of your intial outlay of $500 what a rip off is it really that expensive in the US? I pay a £20 (around $32 at current conversion rates) a month with that I get 1200 mins, unlimited texts, 750MB of internet, 50 photo messages a month and a free phone. Admittedly the phone isn't the best but I could easily buy the WP7 HTC HD7 for £200 (around $320). It amazes me how some people spend so much on their mobile phones and their contracts. Do some people really pay $100?

Here's a easy breakdow for you using the iPhone 4 (generally any "Smartphone")

450minutes = $39.99 (cheapest)
200MB = $15.00 (cheapest) - required.
SMS - $20.00 (unlimited)
Total = $75.00 + tax and fees

Or you can go:
unlimited voice - 69.99
2GB data - $25.00
SMS/MMS - $20.00
Total - $115.00 + taxes and fees

That 2nd plan is the standard for iPhone users as the iPhone does suck a lot of data. This is after paying $200-300 for the new iPhone/Android device as well!

As for me, the $500 is for unlocked devices, no contract. That way I can do what I like with my device and not pay extrra "Smartphone" pricing as well.

DukeEsquire said,

How is your plan only $50/month? Do you get unlimited data or some cap?


He-he.. I'm paying $7 for unlimited data. It's the cheapets one, so the speed is lowered after downloading 1.5Gb.

why the heck do you have prices like these in the US? Whilst I'M using prepaid currently any contract here in Austria seems like stealing from the provider compared to your prices!
One example: (just picked a random smartphone I know)
Provider: 3
Phone: Samsung Galaxy S
Price: 0€
Monthly: 20€ including taxes
Data: unlimited
SMS: 1.000 to all networks
Talk Time: 1.000 minutes

I guess it's a matter of income too. I just did some googling and got the aveage yearly salary for USA is about $55,000. For the UK it's about $44,000 (£27,000) . So while it's not much of a difference, there is some.

Then again we have the BIGGER issue of raping ISPs/Tele and stupid customers that just take the raping without even asking for lube! We don't have as much competition and those telecoms have their hands in the senetors butts using them as puppets to get what they want.

MFH said,
why the heck do you have prices like these in the US? Whilst I'M using prepaid currently any contract here in Austria seems like stealing from the provider compared to your prices!
One example: (just picked a random smartphone I know)
Provider: 3
Phone: Samsung Galaxy S
Price: 0€
Monthly: 20€ including taxes
Data: unlimited
SMS: 1.000 to all networks
Talk Time: 1.000 minutes

Most likely too the geographic area in the US is so massive it costs a lot for infrastructure, where as in the EU countries are generally smaller and it is cheaper to deploy wireless tech.

Is it true that operators in the US don't share infrastructure? 'cause that common practice in Europe to keep costs down. How many operators are the in the US anyway?

MFH said,
Is it true that operators in the US don't share infrastructure? 'cause that common practice in Europe to keep costs down. How many operators are the in the US anyway?

Major operators: AT&T, T-Mobile (soon to be part of AT&T), Verizon, Sprint. Then there are numerous other smaller and regional carriers, some of which (like Net10/Tracfone) piggyback on the networks of the major carriers. Of course, CDMA and GSM carriers can't share infrastructure, but most carriers do have roaming agreements with other carriers in various parts of the country, so there is some sharing going on.

It seems that many people here do like to neglect the fact that Lexcyn pointed out above: the US is over twice the size, geographically, as the EU, with a MUCH lower population density, which drives up cost for carriers tremendously. Many (most?) countries in the EU are smaller, geographically, than an average US state. England, for example, is only slightly bigger than Mississippi (which ranks 32nd in size in the US).

MS Lose32 said,
Apple is starting to feel the pressure from Android. Apple lowers prices and consumers win! Competition FTW!
With iPhone 5 around the corner rumored sporting a larger screen and A5 processor + iOS 5 and Lord knows what, i wouldn't even consider buying a 2 year old piece of junk for even $200. And atleast nobody that i know would either, specially when you can get a decent Android with better specs at the same price point.

They did this with the 3GS, they did this with the iPhone 4 and ofcourse they'll do this again.

3GS release had the 2G, 3G and the 3GS
iPhone had the 3G, 3GS and the iPhone 4

I really did expect this trend to continue, but getting the lower end means that next year it'll get no new features at all since it's current features will be limited this year any ways.

Tony. said,
They did this with the 3GS, they did this with the iPhone 4 and ofcourse they'll do this again.

3GS release had the 2G, 3G and the 3GS
iPhone had the 3G, 3GS and the iPhone 4

I really did expect this trend to continue, but getting the lower end means that next year it'll get no new features at all since it's current features will be limited this year any ways.

3Gs only had the 3G and 3GS. The original was EOLed and sold to clear.
iPhone 4 only had the 3GS and 4. The 3G was EOLed and sold to clear.

Apple have only ever sold last years model, never a two year old model.