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Apple's iphone 3gs expected to live on for under $300 in developingmarkets - Japanese Cell Phone St by grehh hernjer





Article Author Biography
Apple's iphone 3gs expected to live on for under $300 in developingmarkets - Japanese Cell Phone St by
Article Posted: 11/18/2013
Article Views: 93
Articles Written: 1951
Word Count: 426
Article Votes: 0
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Apple's iphone 3gs expected to live on for under $300 in developingmarkets - Japanese Cell Phone St


 
Instead of being discontinued later this year, the iPhone 3GS,first released in 2009, may stay in production for Apple to sellcontract-free in developing markets, where prepaid smartphones arepopular. Analyst Peter Misek with Jefferies received word that Apple hasinked an agreement with "a leading distribution and logisticscompany." That new partnership is intended to push the iPhone 3GSin prepaid markets around the world, and expand channels for theiPhone 3GS in developing countries. Accordingly, Misek believes that Apple is in the process ofrepricing the iPhone 3GS, which currently costs $375 without acontract. He expects that the third-generation iPhone will bepriced between $250 and $300, which would allow someone to buy itwith no subsidy for around the cost of an on-contract iPhone 4S. The iPhone 3GS can currently be had for free with a new two-year service contract in major markets like theU.S.

It serves as Apple's entry-level smartphone, while the iPhone4, first released in 2010, is available for $99 with a carriersubsidy. Apple is expected to launch its new sixth-generation iPhone thisfall. If the company were to continue its current strategy ofdiscounting previous-generation hardware, the iPhone 4S lineupwould be reduced to one capacity for $99, while the iPhone 4 wouldbecome free with a two-year contract. With the iPhone 4 replacing the iPhone 3GS as Apple's entry-levelsmartphone, some might expect that the iPhone 3GS would be anend-of-life product. But based on what Misek has heard, Apple mayhave other plans to expand iPhone sales in markets where Apple hasnot yet made a significant impact.

"Emerging markets" have been identified as a potential source of ahuge number of untapped customers that present a long-term upside for Apple. One analysis conductedearlier this year found that emerging markets have 14 times as manypeople between the smartphone friendly ages of 25 and 34 thanWestern Europe and North America. One report published earlier this year by The Wall Street Journal declared that cheap Android-based smartphones were "crushing the iPhone" inEuropean countries that have been hit hardest by the debt crisis.In those markets, most consumers don't sign contracts and pay thefull, unsubsidized price for smartphones. Apple Chief Executive Tim Cook said last October that the prepaid market is "very, very important" to his company.He said that was one of the reasons the company continues to sellits entry-level iPhone 3GS, to reach lower price points in bothprepaid and postpaid markets.

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