Shara Tibken wrote a thoughtful piece on why capturing more of this market is so important for Apple<\/a><\/span> and for its rival Samsung. <\/p>\nBut you bring up an interesting question: If the older iPhones seem to address this market, why does Apple need to build a lower-end device? The answer is pretty simple. The rumored low-cost iPhone is likely not for mature markets, such as the U.S. <\/p>\n
You have to remember that it’s a big world out there. And there are well more than 2 billion people living in India and China alone. Africa is also an exciting emerging market with millions of potential customers. These are huge untapped markets for Apple and other device makers, like Samsung.<\/p>\n
But it’s difficult to sell high-end devices in these markets where many people can barely afford to buy food. What’s more, these are not markets where carriers offer huge device subsidies. This means a brand-new iPhone 4S in India could really cost someone more than $500, whereas in the U.S. a consumer could get this device for $100 with a two-year carrier contract. <\/p>\n
There is still a lot of demand for iPhones in these markets, which is why resale values of used iPhones are so high. Many of those devices that are traded in on sites like Gazelle and Nextworth are sold internationally in places where iPhones are very expensive.<\/p>\n
This is also where a plastic iPhone, using low-cost components, might be able to meet an unmet demand. Apple could sell such a device for $99 or less without a carrier subsidy. While this may still be out of reach for many people living in these areas, especially those living on less than $1 a day, it could easily appeal to a growing middle class. And I suspect that is just the market that Apple would target.<\/p>\n
My guess is that if Apple introduced such a device, the company probably wouldn’t even make it available in countries like the U.S. This has been the case with other manufacturers’ devices. For instance, Nokia has an entire line of products called Asha that is specifically made for the developing markets. While these devices aren’t as advanced as Nokia’s Lumia line, they would likely appeal to cost-conscious U.S. customers looking for more functional and useful smartphones. But Nokia doesn’t sell the devices here.<\/p>\n
The bottom line is that even if Apple introduces a “low-cost” iPhone, I don’t think it will change the company’s strategy in terms of selling older iPhones in the U.S. market for a reduced price. In other words, don’t hold your breath for a $99 plastic iPhone coming to AT&T or Verizon Wireless. You’ll likely have to move to India, China, or Africa to get your hands on one.<\/p>\n
I hope I answered your question. Thanks for writing!<\/p>\n
Ask Maggie is an advice column that answers readers’ wireless and broadband questions. The column now appears twice a week on CNET, offering readers a double dose of Ask Maggie’s advice. If you have a question, I’d love to hear from you. Please send me an e-mail at maggie dot reardon at cbs dot com. And please put “Ask Maggie” in the subject header. You also can follow me on Facebook on my Ask Maggie page.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"There is no question that Samsung’s Galaxy line of smartphones are giving Apple’s iPhone a run for its money. In fact, some loyal iPhone fans, disappointed with the incremental updates in the iPhone 5, already are looking for something new. Smartphone aficionados agree that when it comes to innovation, Samsung has surpassed Apple. The Samsung […]<\/p>\n","protected":false},"author":226,"featured_media":60126,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3114],"tags":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/1800birks4u.com\/wp-json\/wp\/v2\/posts\/60126"}],"collection":[{"href":"https:\/\/1800birks4u.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/1800birks4u.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/1800birks4u.com\/wp-json\/wp\/v2\/users\/226"}],"replies":[{"embeddable":true,"href":"https:\/\/1800birks4u.com\/wp-json\/wp\/v2\/comments?post=60126"}],"version-history":[{"count":0,"href":"https:\/\/1800birks4u.com\/wp-json\/wp\/v2\/posts\/60126\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/1800birks4u.com\/wp-json\/wp\/v2\/posts\/60126"}],"wp:attachment":[{"href":"https:\/\/1800birks4u.com\/wp-json\/wp\/v2\/media?parent=60126"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/1800birks4u.com\/wp-json\/wp\/v2\/categories?post=60126"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/1800birks4u.com\/wp-json\/wp\/v2\/tags?post=60126"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}