The idea of an iPhone nano has been debated since the device’s inception 4 years ago. Apple’s conquest of the mp3 player market with multiple iPod models has had many folks wondering if Apple was going to do the same thing with their smartphone line.

While most people scoff at the idea of Apple producing a cheap version of the popular iPhone, Horace Dediu of asymco seems to think otherwise. Apparently, Apple has plenty of reasons to manufacture an iPhone “nano.”

Nearly 5 billion reasons. Based on data published by the Deutsche Bank and the ITU, Dediu posted an article outlining several reasons why Apple is likely to release an iPhone nano soon. The largest factor seems to be the pre-paid market they are missing out on.

“Roughly 1.5 billion are post-paid and 3.7 billion are pre-paid. That means that nearly 70% of the world is not being addressed by the iPhone as it currently stands. Put another way, a shift in positioning might result in a 250% increase in addressable market.”

Apple is expected to eventually penetrate the remaining post-paid audiences, but what about pre-paid customers? Since pre-paid plans are generally non-contract, any serious attempt by Apple to invade that market would warrant a significantly less expensive iPhone model.

Let’s not forget the comments made by Apple’s COO earlier this year. In an interview with analyst Toni Sacconaghi, Tim Cook stated that Apple had “clever things” planned for the prepaid market. He also added that Apple didn’t want the iPhone to “just be for the rich.”

Then there is the maturity factor. Daring Fireball’s John Gruber said, “Examine the history of the iPod to see how this will play out.” Well the original iPod launched in 2001, and 4 years later Apple added the Shuffle and Nano models to its line of mp3 players.

Didn’t the iPhone launch in ’07? Apple’s been building iPhones for 4 years, and have a tremendous ecosystem in place with iOS. Add in iOS 5’s new no-need-for-a-computer design, and a cheaper iPhone for the pre-paid market starts to make sense.

We just covered a rumor yesterday that suggested that Apple would be releasing 2 iPhone models this fall, one of which is expected to be dramatically cheaper than previous models. I’m starting to think that this case could hold water.

Thoughts?

  • See i disagree with apple launching an iphone nano.
    Apple is very proud of its app store, so proud that it only has 2 different screen sizes for apps to work on making the devs lives so much easier to develop apps for apple. That kind of over rules an idea of there being a smaller sized iphone, however that doesnt apple wont have a cheaper version… Say same specs but a different design and some features being of lower quality such as the screen, also it could stick to the A4 chip

    • Jon Garrett

      dude,

      the real reason apple is trying to diversify the iphone (iphone 4S, iphone 5, iphone nano) is because they have lost ground to Android phones that come in many different flavors.

      mark my words, from here on out, apple has to diversify, they have to offer more than just one flavor of ice cream…..ice cream? lol, no pun intended.

  • ME

    Remember what I told you. But you all said that there was no such thing. HA

  • SickOfIt

    This tumor (rumor, I meant) has popped up every year around this time since the iPhones inception. It needs to go away.

  • Anyone Who thinks Apple isn’t considering entering the 3.5 billion customer pre-paid market with a cheaper iPhone might want to brush up on their *common sense*

  • sk@tta

    We here in Jamaica are almost 90% pre-paid and we love the iPhone. If the iPhone was cheaper we all wud have it i can guarantee u that. Going to the Pre-paid maket will be a smart move for apple

    • Jon Garrett

      you in Jamaica should just get an Android phone. there are many to choose from an from Free to Expensive. AND, it does everything an iPhone can do and more.

      your second option would be to have one of your friends or family members here in Bklyn send you one 🙂

      • Andre M

        So pathetic, you don’t see iPhone users follow Android developments, cuz we don’t care about them, they are irrelevant to most of us! That’s how most of us feel! Apple has never had to worry too much about it’s competitors, im sure they make their decisions based on other factors,

  • Hi-Top

    Quit spamming this sit with your android junk!

  • Brandon

    “This tumor (rumor, I meant) has popped up every year around this time since the iPhones inception. It needs to go away.”

    Yeah same with the Verizon iPhone and look what happened …

  • Justin

    Why couldn’t Apple just focus on maintaing the 3GS line? They are already going for $50 on AT&T and Apple, and that’s decent for a phone that does a lot. Instead of making an all new device, just take the time to maintain the technology in the 3GS line so that they can support the new iOS upgrades. Idk, I could be over simplifying all that would have to be done, but I just feel that’s a better road to take then to make a smaller device (when everyone keeps wanting a bigger screen) that would be cheaply made.

  • Michael

    One of you said something about screen sizes and apps, how only having two different screen resolutions to care about, makes the developers’ job easier. Well, Apple could just make the iPhone nano’s screen smaller, but with the same resolution as the 3GS’ screen, 480 x 320. That way, all apps would fit the iPhone nano, without the devs having to do anything. That would also make it have a decent PPI.

  • Ben

    The phone is already being tested in the field. It doesn’t look like your mock up at all. It looks more like a pager on steroids. I don’t know whether you can buy apps for it.