Wednesday, June 29, 2011

Free 3GS Easier For Apple To Go After Low-End Market; And $299 In Prepaid Market?

Today, a report came out that Apple will be offering the iPhone 3GS for free with a 2-year commitment once the next iPhone is out and the iPhone 4 goes down to $99.  Right now, the iPhone 3GS can be had with AT&T for $49 with 8GB storage.

I reckon that a free iPhone 3GS could have internal storage even go as far down as 4 GB since iCloud will play a big part in helping stem the need for users to carry as much data with them as they do now.  

And going with the iconic 3GS is an easier route than trying to develop the mythical iPhone nano that just about every analyst and bloggers who spread these rumors have advocated.  After all, just as we are unable to sharpen down our fingers in the way Steve Jobs said regarding 7" tablets, a screen less than 3.5" isn't idea for touch use either.

Having said all this, we might be looking at Apple entering the pre-paid market as well.  A iPhone 3GS with 4GB can go on the market for $300-$350.  For those who do not want to commit to a two-year contract, this is a very good option.  Just recently, a comparable device, the Motorola Triumph, was introduced on the Virgin Mobile network for $299.  

The Triumph, while it doesn't run iOS 4 or 5 and cannot fit into the iTunes ecosystem, it does have a faster processor and bigger screen.  So my thinking is that Apple can probably offer the 3GS at $299 for the prepaid market as well.  Given that Apple has a command to maintain a premium even at the low-end of the market, I don't see the price going lower.

Obviously, like you, I await his Steveness to dazzle us later this summer when the iPhone lineup is refreshed.

Source:  Appleinsider.

Note:  Apple has been very aggressive going after the tablet market.  Perhaps, it might do the same with the smart device market and really surprise everyone with new pricing entries.

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