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Apple's Phil Schiller rules out 'cheap' iPhone

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Apple's senior executive Phil Schiller has seemingly ruled out the firm launching a 'cheap' version of the iPhone, despite growing speculation of a shift in strategy for Apple's most valuable product.

Earlier in the week, The Wall Street Journal reported that Apple's rumoured plans for a "lower-end" iPhone were accelerating and the handset, often dubbed the "iPhone Mini", could launch later this year.

iPhone 5 launch event: Phil Schiller, Apple's senior vice president of worldwide marketing, talks about the features of the new camera and iSight during an introduction of the new iPhone 5 at an Apple event in San Francisco, Wednesday Sept. 12, 2012.

© PA Images / Eric Risberg/AP



The report said that Apple is concerned about losing smartphone market share to big rival Samsung, which offers a much broader range of handsets with different technical specs and price points.

But in an interview in China with Shanghai Evening News (via Trusted Reviews), Schiller appeared to pour cold water on the speculation.

Apple's head of worldwide marketing was quoted as saying that "despite the popularity of cheap smartphones, this will never be the future of Apple's products".

Schiller suggested that Apple would stick with its previous policy of offering only premium products with premium price tags.

Phil Schiller, Apple's senior vice president of worldwide product marketing, introduces the iPad Mini

© PA Images / Marcio Jose Sanchez/AP



"Every product that Apple creates, we consider using only the best technology available," he said.

Some commentators have pointed to Apple's declining share of the worldwide smartphone market, and the rise of Samsung, as evidence that a change in strategy is required for the iPhone.

Despite the iPhone being Apple's biggest revenue generator - accounting for 48% of its earnings in the quarter that ended September 2012 - the firm only releases one new version each year.

In the third quarter of 2012, Apple held 14.6% of worldwide smartphone shipments, down from a peak of 23% in the fourth quarter of 2011 and the first quarter of 2012, according to IDC.

By contrast, Samsung's share of smartphone sales has risen from 8.8% in the third quarter of 2010 to 31.3% in the third quarter of 2012. But Schiller feels that market share is not the only indicator of success.

Photo gallery - the history of the iPhone:
"Although Apple's market share of smartphones is just about 20%," he told the paper, "we own 75% of the profit."

Despite Schiller's seeming denials of the iPhone Mini plans, it is worth reading between the lines of what he said. The Apple veteran merely ruled out producing a "cheap smartphone", and Apple could still produce a lower-end iPhone that would not be considered "cheap" in the conventional sense.

Last year, Apple boss Tim Cook introduced a smaller version of the iPad, called the iPad Mini, which was cheaper than the main iPad but still produced with premium materials and around £100 more expensive than competitor products in its class.

The firm could therefore still be planning to introduce an iPhone Mini product to its range that would be made of a different shell, such as polycarbonate plastic rather than aluminium.

This could bring down the cost of the device against the £529-starting iPhone 5 and enable Apple to target a new batch of customers without compromising its values.

Would you like to see an iPhone Mini launch this year? Let us know below...

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