white iPhone 5c

Recall how the iPhone 5c was thought to be Apple’s answer to China’s smartphone market dominated by inexpensive handsets? Turns out, the handset costs “significantly more” than expected and nearly as much as the full-featured iPhone 5s, also unveiled Tuesday. At $733 without a subsidy (in China), the iPhone 5C may not be so cheap after all.

“By any standards, it’s a premium price,” one analyst told the New York Times Wednesday morning. However, there still could be good news for Apple, as China approves the iPhone for China Mobile, the world’s largest wireless carrier…

At $549/$649 for 16/32GB off-contract models in the United States, the iPhone 5c costs almost as much as the unsubsidized iPhone 5s. But in China, according to Apple’s website, the iPhone 5c starts at 4,488 renminbi, which works out to approximately $733.

This is the price without subsidies from mobile operators. By comparison, the new flagship iPhone 5s starts in China at 5,288 renminbi, or approximately $864. Both phones evidently cost significantly more than the growing number of inexpensive homegrown smartphones, such as the $327 Mi3 from Xiaomi.

Many observers expected the iPhone 5c to carry a price tag closer to $400. The price of Apple’s new iPhone left one analyst grumbling that Apple was using sleight-of-hand.

iPhone 5s and 5c off contract prices

“When you really look at it, they didn’t make a cheaper phone. They made a more expensive phone so that they could call the other one a cheaper phone,” Francis Sideco, analyst with research firm IHS, told the New York Times.

A HSBC analyst in Taipei described the iPhone 5c as “clearly a high-end phone, not a low- or even midrange phone.”

Although there is some sticker shock regarding the iPhone 5c’s unsubsidized price, new approval from China’s regulators could offer consumers some relief.

The Wall Street Journal confirmed today that the 5c was approved for China:

According to the website of China’s Telecom Equipment Certification Center Wednesday, Apple was given a ‘network license’ for a handset resembling the iPhone that runs on the mobile standards used by China Mobile for third and fourth generation cellular services.

The report likely signals the carrier with 700 million subscribers – more than all U.S. carriers combined – is about to offer the iPhone, a decision Apple CEO Tim Cook and others have sought for years.

green blue pink iPhone 5c side by side

The decision could also calm the nerves of those worried that the iPhone 5c cannot compete against low-priced rival smartphones in China. Unlike in the US, where carriers offer a subsidy to make handsets more attractive, China’s carriers tend to discount customers’ monthly bills, according to today’s reports.

It’s also possible that Apple is testing the waters with the current iPhone 5c pricing scheme.

“The fact is, Apple doesn’t know what demand for the iPhone 5C will be in developing markets,” Yankee Group’s Carl Howe told CNN Money.

He postulated the company could be looking to “start high and make adjustments later” as a way of preserving its industry-leading margins.

  • Andy

    “Start high and make adjustments later”

    So in other words, the price will be adjusted 1 year later when iPhone 6 comes out.

    • Falk M.

      Think iPhone 1, there might be something to this.

      I’m extemely skeptical about the price just like the next guy, but I think this could really be Apple’s reasoning.
      At least in the Chinese market they might want to try this.

  • richrich

    I don’t see anybody wanting, or buying 5c… if anybody decides to get a new iPhone, they will either get a 5s or simply 5 off ebay. The only reason to be getting the 5c was the price, and now it’s not even an incentive… mark my words, 5c will be Apple’s biggest fiasco.

    • rasengan720 .

      I agree with your point

      • richrich

        thank you!

    • n0ahcruz3

      I completely agree. +1 for you

    • Mohammad Ridwan

      I agree with you…. 5c looks like a cheap product without a cheap price tag. 5s looks more appealing….

    • Totally agree. They’re using the same tactic they applied on the iPod Touch 4G; replace it with a much less appealing version and more people will buy the newer version.

      Unfortunately, it seems to have worked in the U.S., so, now they’re going to test the extent of human idiocracy in China…Common Asians, show Apple that you do your thinking yourself…

  • Joseph liong

    This is apple dude..

  • Archit

    Apple made 5C just to reduce their production cost and sell it at the cost of iPhone 5…
    If they hadn’t launched it.. They would have to sell iPhone 5 at the same price… Which would not bring them greater profits… And obviously force peolple to buy iPhone 5S for that design…
    Nice job apple… -_-

    • Precisely! Just like they did to the 16 GB iPod Touch 4; they replaced it with a much less appealing version, just to force people to get the latest if they want basic features like a rear camera.

  • Markus Hudobnik

    This is lame. the iPhone 5C should be free with a 2-year contract

    • Rowan09

      That’s funny why? If that’s the case it would only run IOS 5 at best.

      • Probably not iOS 5, but iOS 6 for sure, just like they quickly discontinued iOS support for the less appealing 16 GB iPod touch they just recently used to replace the iPod Touch 4.

  • Grande PHD

    This is not a cheap phone, but it looks cheap.

    • Andy

      And even cheaper to manufacture, so for Apple even bigger profit margins!

      • Altechi

        According to iSuppli, the iphone 5 cost $207 to make, imagine how much less it would be without the aluminium

  • n0ahcruz3

    549? Yikes!

  • Mohammad Ridwan

    lol

    • Falk M.

      How do you not have a hundred thumbs up, this is brilliant!

      Maybe not many Austin Powers fans here?

    • Rowan09

      Lol. It’s as affordable as a Louis Vuitton bag.

  • Merman123

    The tone of this article is bothersome, almost as if we’re being punished by our mothers for acting childish. Of course apple never promised a budget iphone, they didn’t promise anything, no company does. It would be ridiculous to. But we have reasonable expectations as consumers, and when those expectations aren’t met, then logically we will voice our opinion. What a cop out article, especially after (as stated) iDB posted about these expectations numerous times.