Topeka Capital analyst Brian White asserted Monday morning that a lower-priced iPhone could be introduced as early as this June. It will be sold unsubsidized for about $250-$300, he thinks, and suggests “iPhone Mini” or “iPhone Air” as names. Just as The Wall Street Journal originally reported, White expects the less-expensive iPhone to use a plastic body instead of metal and glass.
It would have a lower margin than prior iPhones though Apple could make up for the difference in sheer volume as carriers in emerging markets like China, Brazil and India could position the device as a competitive offering to local brands, like the Xiaomi handset which costs around $320 off-contract in China…
Forbes relays White’s note:
A $250-$300 price range would also be competitive with China-based Xiaomi that offers a high-end phone experience at a mid-range price of ~$320 in China.
One analyst previously likened a much cheaper iPhone to the augur of a new era of lower Apple margins.
This is China’s Xiaomi handset:
He also notes:
We believe a $250-to-$300 price point will allow Apple to significantly expand its reach in the smartphone market and better address developing markets such as China, while opening up more opportunities in Brazil, Russia, India and elsewhere.
The price sounds just about right.
An unlocked 16GB iPhone 5 costs $649, putting it out of reach of price-sensitive shoppers, with the price going way up in markets like Brazil and India due to taxes.
Apple’s least expensive off-contract iPhone is the $450 iPhone 4.
Some folks may not be aware of this, but handsets in lots of markets outside the United States are sold for the full price, unsubsidized. This allows users to easily switch carriers by swapping another SIM card and activate pay-as-you-go prepaid minutes.