Apple Has No Plans for “Low-End Voice Phone”

Apple Indirectly Denies iPhone Nano

by Anton Shilov
01/22/2009 | 10:44 AM

The rumours regarding more affordable Apple iPhone handsets have been making the rounds for many quarters now, but Apple has never confirmed them. However, during the most recent conference call with financial analysts the company indirectly denied that it has plans to release a more affordable – iPhone nano – version.

 

“You know us. We are not going to play in the low-end voice phone business. That’s not who we are. It is not why we are here. We’ll let somebody else do that. Our objective is not to be the unit share leader in the cell phone industry, it is to build the world’s best phones,” said Timothy Cook, chief operating officer of Apple, who is currently responsible for the company’s day-to-day operations.

The claim of Mr. Cook seems to be a rephrasing of the well known expression by Steve Jobs who said that there is no way for Apple to “make a $500 computer that is not a piece of junk”.

While Mr. Cook and Mr. Jobs do not want to emphasize it, the Apple iPod family includes completely different models, including entry-level iPhone shuffle without screen at all that costs $49 as well as Apple iPod touch with touch-sensitive display that sells for up to $399. But even the broad iPod family faced 16% annual revenue decline in Q4 of Apple’s FY2009, which indicates increase of demand towards more affordable models. Moreover, revenues from Apple’s desktop computers, dominated by the iMac, fell 31% year-to-year.

“iPod revenues fell as a result of saturation of the media player market, cannibalization by the iPhone, and lower priced players, including Apple’s own iPod shuffles. Apart from portable application platforms and Web browsers like the iPod touch, TBR believes media players are a stagnant market,” said analyst Ezra Gottheil from TBR market research company.

It is logical that amid global economic slump consumers will cut their spending and the demand will shift to more affordable products. Apple does have lineups of iPod digital media players and personal computers that include both inexpensive and premium products, but the iPhone exists only in one version that is relatively expensive. As a result, a cheaper version of the product is definitely needed on the market.