Analyst Claims Apple May Release $349 iPhone for Prepaid Markets This Year

Fortune reports that Deutsche Bank analyst Chris Whitmore today released a new research note claiming that Apple may be preparing to release two new iPhone models later this year, with the usual iPhone revamp being joined by the debut of a cheaper model coming in at an unlocked, unsubsidized price of $349.

In a note issued early Monday, Deutsche Bank's Chris Whitmore is telling clients to expect both -- an iPhone 5 and an iPhone 4S.

"With Nokia and RIMM struggling," he writes, "the time is right for Apple to aggressively penetrate the mid range smart-phone market (i.e. $300-500 category) to dramatically expand its [total addressable market] and market share."

As Whitmore sees it, an iPhone 4S that is unlocked, priced around $349, and comes with a pre-paid voice plan would "drive significantly greater penetration" into an addressable market that has grown to include 1.5 billion potential customers in 98 countries, two thirds of whom prefer pre-paid plans.

Whitmore notes that while the market for prepaid smartphones is very small in the U.S., many other markets around the world have much higher levels of prepaid activity, and a cheaper iPhone would significantly lower the barrier to entry for those customers.


A cheaper (and in many cases smaller) "iPhone nano" has been the subject of many rumors over the years, although it is unclear just how Apple will be able pare down the current iPhone's feature set to bring the unsubsidized pricing down to the $349 level suggested by Whitmore, or even lower price points as suggested in previous reports. Unsubsidized pricing for the iPhone 4 begins at $649, although the 8 GB iPhone 3GS still sold by Apple comes in at a much lower $449. With Apple's iPod touch line starting at $229, there may in fact be some flexibility to put together a somewhat stripped down iPhone coming in at a price point in the $350 range.

Also unclear is the basis of Whitmore's claim, whether it be concrete information obtained from Apple's supply chain or mere speculation on what Apple "should" do.

A separate note issued yesterday by Morgan Stanley's Katy Huberty claims that Apple is set to begin ramping production of a new iPhone in mid to late August, suggesting that a launch might not occur until late September. Rumors have increasingly pointed to a September launch for the next iPhone, although many have been hoping that Apple will introduce it at an early September event in line with the company's usual iPod-focused event.

Top Rated Comments

(View all)
Avatar
122 months ago
Americans just love paying $1000+ per year for their cell phones. And then they wonder why they are all in debt. Couple that with a daily $4-5 Starbucks drink and you have roughly $2.5K for an iphone and coffee for ONE YEAR. Over 40 years, that comes out to be $100,000 for a cell phone and a daily morning coffee. That's just stupid.
Score: 6 Votes (Like | Disagree)
Avatar
122 months ago

No it wouldn't, the customers that have been buying the premium iphone will continue to buy the latest & nicest iphone, but the people who have been buying the $229 touch will now buy the $350 iphone nano. (which is what i would be inclined to).


same here. if this were nothing more than an iPod touch with a cell radio, earpiece and relocated mic, i'd buy it.

iPhone A: 16GB, A5, 4G radio, 8MP camera, $199 on contract
iPhone B: 8GB, A4, 3G radio, 3MP camera, $299 contract free

something like that. heck to save money, just lower the price of the iPhone 4. which is more likely.
Score: 4 Votes (Like | Disagree)
Avatar
122 months ago
- Essential for markets where pre-paid/post-paid plans are very popular. Among best examples would be markets like: India, China, Malaysia, etc.

I belong to India and I'm aware that almost every person who buys a phone is on a post-paid [per monthly] or a pre-paid plan. But both these plans do not include the cost of the phone. You've got to buy the phone yourself. $350 sounds like a great price for such a market.

- Lets be honest: not everyone affords an iPhone. I used to have an iPhone but at present I use Mozart7. I got a couple of Trophy7s for mom and my aunt.
Why? - work like an iPhone -- touch screen ... but cheaper than the iPhone. An iPhone 4 would have cost me close to £500. I got the other two for a total less than £500. :rolleyes:

- Not everybody carries an expensive phone. If I were to gift a phone to my little brother or probably my girlfriend, I'd buy a cheaper - non-iPhone model. If a cheaper option was there, I wouldn't have been bothered at all.

iPhone has to become cheap overtime if Apple needs to take care of some more people. They are going good with whatever they have but if they need to aggressively compete, they need a cheaper iPhone.
Score: 4 Votes (Like | Disagree)
Avatar
122 months ago
Why should Apple design an all-new pre-paid iPhone...

...when they have a then-quasi-outdated iPhone4 they can sell as low-end model?
Score: 4 Votes (Like | Disagree)
Avatar
122 months ago

No it wouldn't, the customers that have been buying the premium iphone will continue to buy the latest & nicest iphone, but the people who have been buying the $229 touch will now buy the $350 iphone nano. (which is what i would be inclined to).



I would do this in a heart beat if I'd be able to get it on Virgin Mobile, heck Virgin Mobile sells the iPhone in Canada.
Score: 3 Votes (Like | Disagree)
Avatar
122 months ago


The problem is that prepaid folks doesn't have purchasing power


Big bold assumption there. People on prepaid just don't see a reason to pay $80 a month, when $15/month prepaid plans fit their usage much better.
Score: 3 Votes (Like | Disagree)

Top Stories

Samsung Mocks Apple for Ditching Power Adapters With iPhone 12 Lineup

Thursday October 15, 2020 11:51 am PDT by
Samsung on its social channels is mocking Apple for removing the power adapter from the iPhone 12 lineup and other iPhone models, pointing out the fact that the Samsung Galaxy smartphones continue to ship with a power adapter. "Included with your Galaxy," reads a Samsung Facebook post that features a picture of a power adapter. Apple notably is no longer providing power adapters or...

iPhone 12 Pro Pre-Orders Already Selling Out With Delivery Times Pushing Into November

Friday October 16, 2020 6:35 am PDT by
Apple today opened pre-orders for the 6.1-inch models of the iPhone 12 and iPhone 12 Pro through its website and the Apple Store app, and estimated delivery times are already slipping into November for select configurations in the United States. Customers ordering a SIM-free/Pacific Blue/128GB version of the iPhone 12 Pro, for example, are already facing an estimated delivery window of...

HomePod Mini Cable is Non-Detachable, Ends With USB-C Connector for Use With Included 20W Power Adapter

Friday October 16, 2020 12:45 pm PDT by
While not detailed in the tech specs, MacRumors can confirm that Apple's new HomePod mini features a non-detachable power cable that ends with a USB-C connector for use with the 20W power adapter included in the box. With the switch to USB-C, the HomePod mini could potentially be powered by a wider range of devices and peripherals, ranging from MacBooks to USB-C battery packs with enough...

Apple's New MagSafe Charger and Cases Begin Arriving to Customers

Saturday October 17, 2020 10:10 am PDT by
Apple's new MagSafe charger and cases have begun arriving to some customers earlier than expected, and images of the accessories have started to surface on Twitter. The photos provide a first look at the products in real-world use. As of writing, some MagSafe cases are also available for pickup at select Apple Stores in countries like the United States, Canada, and Germany. Filip...

New Google App Feature Lets You Hum a Song to Search for It

Saturday October 17, 2020 4:05 am PDT by
Google has added a new feature to its Search app that allows you to hum a song that's stuck in your head, and then use the company's machine learning algorithm to try and identify it. In the Google app or using the Google Search widget, tap the mic icon and say "what's this song?" or click the "Search a song" button. Then start humming the tune for 10-15 seconds. When you're done, the...

Brazilian Certifications Suggest iPhone 12 Mini Features 2,227mAh Battery and iPhone 12 Has 2,815mAh Battery

Friday October 16, 2020 1:08 pm PDT by
Apple's iPhone mini has the shortest battery life out of all the iPhones in the iPhone 12 lineup due to its small size, but Apple has not provided public information about the battery's capacity. A regulatory filing from Brazil, however, suggests the iPhone 12 mini has a battery capacity of 2,227mAh. The same regulatory information says the iPhone 12 features a 2,815mAh battery, which is...

Apple Offering Free AirPods With iPhone 11 Purchase in India as Part of Diwali Celebration

Friday October 16, 2020 12:35 pm PDT by
Apple today launched a new Diwali promotion in India that will see the company providing customers with a set of AirPods with the purchase of any iPhone 11 model. The new iPhone 12 models are not part of the promotion. Apple is offering the standard AirPods With Charging Case free with purchase, but customers can choose to upgrade to the AirPods with Wireless Charging Case or the AirPods Pro....

Apple Event to Unveil First Apple Silicon Macs Could Happen on November 17

Friday October 16, 2020 2:24 am PDT by
Apple will hold another digital event on November 17 to announce its first Apple Silicon powered Macs, according to frequent leaker Jon Prosser. Apple has already said that this year it intends to introduce the first Mac powered by an Apple Silicon chip instead of an Intel processor. One thing it hasn't revealed is the date it will be announced. According to Prosser's source, that date is No...

Apple Online Store Down Ahead of iPhone 12 and 12 Pro Pre-Orders

Thursday October 15, 2020 11:15 pm PDT by
Apple's online store is down ahead of iPhone 12 and iPhone 12 Pro pre-orders, which are set to begin at 5:00 a.m. Pacific Time in the United States. "You're... early," reads the Apple Store message when attempting to visit the U.S. website. "Pre-order begins at 5:00 a.m. PDT. Enjoy the extra sleep." Apple used to do new device pre-orders at 12:01 a.m. Pacific Time, but since last year, has...

When You Can Pre-Order the iPhone 12 and 12 Pro in Every Time Zone

Thursday October 15, 2020 10:55 am PDT by
Pre-orders for the iPhone 12 and the iPhone 12 Pro are set to kick off on Friday, October 16 at 5:00 a.m. Pacific Time, which is a new launch time that Apple adopted as of last year. Apple is planning to make the new devices available in multiple countries around the world simultaneously, so we've made a guide to let MacRumors readers know when pre-orders will in their country. Pre-orders...