Say what you like about the Apple iPhone, but it isn't exactly cheap. And yet Apple can't seem to make enough of the things, and each new release sees a repeat of the usual stock shortages and queuing-round-the-block madness that are now par for the course for an iPhone launch.
So why, then, would Apple be considering launching a budget edition of its wonder-phone, one that will retail for as little as £125, or so the theory goes? Simple – because you and I don't matter any more.
Or not in terms of the growth of the smartphone market. You see, we're already all using the things, and the established order has been, well, established.
In China, meanwhile, it's estimated that there are currently 200 million smartphone users. By the end of 2013? 500 million. And it's a market the iPhone's pricing model isn't built for.
And so Business Insider is reporting well-known Apple analyst Gene Munster as predicting the 2014 arrival of a new iPhone built for emerging smartphone users in China and India – one that will cost around the same outright as the current iPhone does with a price plan.
Let's look at things a little closer: in terms of the current iPhone, the pricing model goes something like this: consumer signs up for an iPhone, paying Apple about a third or a quarter of the price of the phone up front. Provider pays the rest, and makes its money back through mobile data costs over the next 18 or 24 months.
In India and China, where the majority of global smartphone market growth will take place in the next year or two, things have developed so rapidly that smartphones haven't first become established as luxury devices like elsewhere – the overwhelming majority of users would be priced out of such a market anyway.
Instead, the smartphone market has grown on the back of affordable smartphones – primarily Android devices – priced around the £100 mark outright. It's no surprise, then, that Apple is currently a niche player in China and India, and is likely to remain so as things stand.
With all that in mind, it's hardly the work of genius to predict Apple might look to change things at some vague point in the future. After all, if a cut-price iPhone doesn't materialise 18 months from now, it's hardly like Munster will be ridiculed for making such a vague prediction so far ahead of time.
The issue is more about a simple choice lying before Apple. Its remarkable run of success in recent years has centred around the iPhone – a premium product delivering premium profits. Does it stick to that model and effectively yield emerging markets largely unfought, in so doing lowering its overall reach globally and making iOS a less attractive platform for third parties and developers?
Or does it go after markets like China and India with a mass market smartphone solution, knowing a knock-on effect on its image and existing pricing model in developed markets is unavoidable, but willing to give that up for increased numbers overall.
One thing is certain – Apple can't have it both ways.
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