Apple SVP Schiller appears to rule out 'low-end' iPhone

Apple SVP Schiller appears to rule out 'low-end' iPhone

My normal reaction to the deep dark hole that is iPhone rumour stories is to get Lewis to write them, but it's a new year and all that so I thought I'd get my hands dirty for a change. He'll get the next Elop piece in exchange.

Anyway, he's partially already covered this one, as it's about Apple SVP Phil Schiller seemingly playing down the likelihood of a budget iPhone seeing the light of day, as was suggested a couple of days ago.

Schiller was speaking to the Shanghai Evening News this week – some of Apple's senior management are over in China right now, where the iPhone launched for the first time late last year. And while he didn't reference the budget iPhone rumour directly, Schiller's comments (verified by The Next Web before publishing, unlike with other recent translations) certainly seem to aim a fair-sized bucket of cold water in its general direction.

“Every product that Apple creates,” Schiller is quoted as saying, “we consider using only the best technology available. This includes the production pipeline, the Retina display, the unibody design, to provide the best product to the market.

“At first, non-smartphones were popular in the Chinese market, now cheap smartphones are more popular and non-smartphones are out,” Schiller added later.

“Despite the popularity of cheap smartphones, this will never be the future of Apple’s products. In fact, although Apple’s market share of smartphones is just about 20%, we own the 75% of the profit.”

It's hard to reconcile those remarks with the recent claim that Apple is planning a “smaller, cheaper” version of the iPhone for “developing nations”, a title which China would fall into as far as Apple's market position is concerned.

And compared to the original claim – in fact, compared to 99% of iPhone rumour stories – this one is actually based on comments actually made by a senior figure at Apple (and verified as accurate).

That said, China is obviously important to Apple (as it should be), and despite the iPhone having reportedly been better received than the company was expecting, the drive to expand its reach to a larger audience will always lead to the potential for cheaper product options in the future.

But truly going after the low-end smartphone vendors that are currently doing such good business in China would involve Apple having to change its production process and choice of materials, not to mention its approach to product branding and marketing, and as Schiller seems to be pointing out, that would run contrary to the principles that have made the company so successful in the first place.

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13 comments

Pondlife  Jan. 10, 2013 at 20:31

“Every product that Apple creates,” Schiller is quoted as saying, “we consider using only the best technology available. "

*cough* *cough* ipad mini *cough* *cough*

Although it only says consider...

eddyday  Jan. 11, 2013 at 03:10

Of course. Apple produce premium products. If they decided to go down the route of producing cheap garbage they'd be turning themselves into Samsung.

JanSt / MOD  Jan. 11, 2013 at 06:46

I don't think his statements rule out a budget iPhone "Mini", at all. It's just relative what "budget" means in the context.
The iPad Mini had no retina display. And they don't call it the iPad Budget - it's the Mini.

Having said that: I don't believe they'd go for a plastic iPhone as suggested by the Wall Street Journal - even if just for the Chinese market.
It took Apple a gadget eternity to notch it up to 4 inches which is pretty Mini by today's standards. And there are hundreds of millions of 3.5 inch iPhones around. How mini would a mini need to be to be mini? 3 inches? See how well the 700 worked for Nokia ;)

8thlegion  Jan. 11, 2013 at 08:33

Of course. Apple produce premium products. If they decided to go down the route of producing cheap garbage they'd be turning themselves into Samsung.

troll ...yawn.... hurry up and stop playing on the internet the school bus is waiting for you.

Iknownothingatall  Jan. 11, 2013 at 09:21

Apple phones are already cheap in comparision to their retail prices - that is why they own 75% of the profit, however the cost of that is market share, which if they want to gain ground on they need to lower the retail price of their product closer to the competition, it can still be at a premium but currently that premium can be double the cost (when you consider a 32/64 gb phone vs an S3 with mem card).

The speculation isnt about them producing a cheaper phone, its about them lowering the retail price of their current phone.

JanSt / MOD  Jan. 11, 2013 at 12:21

Apple phones are already cheap in comparision to their retail prices - that is why they own 75% of the profit, however the cost of that is market share, which if they want to gain ground on they need to lower the retail price of their product closer to the competition, it can still be at a premium but currently that premium can be double the cost (when you consider a 32/64 gb phone vs an S3 with mem card).

The speculation isnt about them producing a cheaper phone, its about them lowering the retail price of their current phone.


errm... good points, but no, you are wrong! This article and the ones that inspired it suggest indeed a CHEAPER iPhone with CHEAPER materials (WSJ, e.g. mentions plastic housing etc)... So, although your suggested approach would have merit if this wasn't Apple, it is a different issue.

Sulphur Man  Jan. 11, 2013 at 12:37

Another bone-headed TechRadar article, or just slow-witted Friday weekend wind-down?

A 10 second trip to the UK Apple Store reveals that they continue to manufacture and sell the older iPhone, starting at £319. They dont need to make a cheaper iPhone, because they already do!

Move on.

JanSt / MOD  Jan. 11, 2013 at 12:53

Another bone-headed TechRadar article, or just slow-witted Friday weekend wind-down?

A 10 second trip to the UK Apple Store reveals that they continue to manufacture and sell the older iPhone, starting at £319. They dont need to make a cheaper iPhone, because they already do!

Move on.


Have you not read the article above?

matt101101 / MOD  Jan. 11, 2013 at 13:25

Another bone-headed TechRadar article, or just slow-witted Friday weekend wind-down?

A 10 second trip to the UK Apple Store reveals that they continue to manufacture and sell the older iPhone, starting at £319. They dont need to make a cheaper iPhone, because they already do!

Move on.

Have you looked how poor value buying an older iPhone from Apple is? I assume not, as you're suggesting it's a viable "budget" option.

Pondlife  Jan. 11, 2013 at 14:15

Can you remove the word older from that first sentence?

matt101101 / MOD  Jan. 11, 2013 at 15:14

Can you remove the word older from that first sentence?
I could do, it'd definitely still be true :p. Then again, iPhones do hold their value quite well, so the total cost of ownership isn't going to be that much more than a high end Samsung.

malarky  Jan. 12, 2013 at 18:11

JanSt / MOD  Jan. 12, 2013 at 18:26

Ooh :p

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