Apple Wants to Develop Products Not "Just for the Rich" - Analyst

Comments by Apple COO Point to Lower-Priced Offerings

by Anton Shilov
02/28/2011 | 07:58 PM

In a bid to offer premium experience across the board, Apple has avoided development of any affordable devices for many years. But in a bid to further expand its market presence, Apple is looking forward to create devices not "just for rich", according to an analyst, who last week met with Tim Cook, chief operating officer of the company and interim chief exec, and other high-ranking execs of the company.

 

According to Toni Sacconaghi, an analyst with Bernstein Research, Mr. Cook “appeared to reaffirm the notion that Apple is likely to develop lower priced offerings” to expand the market for the iPhone. The chief operating officer of the company reportedly called iPhone "the mother of all halos" and indicated that the company was planning “clever things” to address the prepaid market, and that Apple did not want its products to be "just for the rich" and cede any markets reports Forbes web-site.

In a lot of countries people prefer to buy phones without any contracts so that not to be tied to a particular operator. Naturally, not a lot of people can afford paying €700 - €830 ($970 - $1150) for a contract-free iPhone, but those consumers can still consume the content Apple sells. As a result, Apple does need to develop smart approaches to those market so that to address them without making Apple-branded products a commodity. One of the current priorities for Apple is expansion of the number of carriers it has ties with. Apple has only 175 carriers today, whereas even Research in Motion has 550. Naturally, increasing the number of carriers supporting Apple will expand its market share.

Previously, Apple has denied any plans to release affordable versions of its iPhone handset citing necessity to offer maximum possible experience. However, the company should have learnt from its iPod business that in order to be the leader in terms of volume, one needs to address all possible market segments from top to bottom. Earlier this year rumours emerged that Apple was gearing up to release two versions of iPhone this summer: one with large screen and one with smaller screen compared to the iPhone 4.

Mr. Cook also reportedly said that the market of tablets "would be much bigger than the PC market" and that the competition on this market would be more intense than that on the market of smartphones as slates would be made both by PC manufacturers and smartphone vendors.

It remains to be seen whether intention to make devices not "just for rich" only applies to mobile phones, or the company has serious market expansion plans under which it would design more affordable Macintosh PCs, iPad slates and other products.