Apple (AAPL) Dismisses Cheap iPhone Rumors

By Jan 11, 2013, 8:02 AM Author's Blog  

In an interview with the Chinese newspaper Shanghai Evening News, Apple (AAPL)’s marketing chief Phil Schiller, who is currently accompanying CEO Tim Cook on his trip to China, stated that Apple is not focused on developing a less expensive version of its iPhone for the sake of expanding the product’s market share.

“Despite the popularity of cheap smartphones, this will never be the future of Apple’s products”, Schiller was cited as saying by the Chinese newspaper when asked about Apple possibly creating a budget iPhone in the near future. “In fact, although Apple’s market share of smartphones is just about 20%, we own the 75% of the profit,” he added.

Schiller’s interview, which was confirmed by Apple to The Next Web, comes just days after numerous news outlets cited sources claiming Apple would release a cheaper iPhone as early as this year to address emerging markets like China.

While Schiller’s comments could be read as an outright denial of that possibility, it’s important to keep in mind that the wording is key in these instances. Note how Apple’s marketing wiz doesn’t define what he means by “cheap smartphones.”

Apple’s future is going to be making premium products that sell in the high-end of the market. But that doesn’t mean the company isn’t planning on producing a smartphone just as it managed to produce a cheaper iPod nano than the iPod, or a cheapear iPad in the shape of the iPad mini that still uses very high quality parts but sits at a smaller price point. So Apple will most probably find a way to produce a less expensive high-quality iPhone but with a different marketing angle.

Apple shares last closed at $523.51, up $6.41, or 1.24%, on 21 million volume.

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