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Report: $99 iPhone is inevitable, maybe a new model

updated 04:05 pm EST, Fri December 5, 2008

99 dollar iPhone

Amidst the rumors of a $99 4GB iPhone that might be sold after the holidays at Wal-Mart, analyst firm Kaufman Brothers has reported that a $99 device is inevitable. The exact timing of the discount remains unclear, although Apple could be developing a strategy to expand the range of iPhone products to include a low-end, mid-range, and high-end device. The new products are likely to offer feature differences beyond the current availability of several flash storage capacities.

The overwhelming success of the iPod line could partially be contributed to the breadth of available devices. Although Apple does not hold the same market share in the mobile phone segment as it does with personal media players, providing additional handset options could further establish its presence, drawing from the established strength of the iPhone brand.

The Kaufman analysts believe that the iPhone could support the $99 price without significantly reducing margins. Apple and mobile carriers negotiate subsidies, revenue sharing plans, and royalties. Although the actual cost of the device is closer to $700 by some estimates, the iPhone is typically purchased with a more expensive data plan in addition to the voice plan. Customers in certain countries already pay less than $199 with longer contracts and premium packages.




by MacNN Staff

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Comments

  1. lowededwookie

    Joined: Dec 1969

    +1

    He who does not learn

    He who does not learn from the past is doomed to repeat it.

    These people's minds are pretty lax on memory are they not? If Apple was going to release a cheap 4GB iPhone THEY WOULDN'T HAVE DITCHED THE MODEL IN THE FIRST PLACE.

    Since when has Apple ever gone backwards and reintroduced a model they ditched?

  1. flask

    Joined: Dec 1969

    +2

    price plans

    When the iPhone 3G was introduced at a lower price, the monthly phone plan went up. So I wonder what changes will be in this $99 iPhone's mandatory pricing plan? We're already charged for outgoing AND incoming text messages unless we want to pay an extra $5/month (for 200). Maybe at&t will up the data plan to $40 and charge a dollar per text message to make up for the subsidized phone.

  1. Macrat

    Joined: Dec 1969

    +2

    cheaper plans

    Its not the iPhone that needs to be cheaper its AT&T. For seldom phone users like myself the current plan is too drastic an increase to justify, even though I would love to have an iPhone even if it cost $400 by itself.

  1. ggirton

    Joined: Dec 1969

    +1

    silly

    it's silly to think that the iPhone "costs" $700 when you can buy an iTouch -- which has no monthly dataplan -- for $200. $500 additional for a cameraphone? I don't think so.

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