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by us
5606 days ago
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There are several problems with this hypothesis. Apple has said it before that they're getting more iPhone orders than they can manage to build in many cases. At $625 per iPhone and they're selling like hotcakes on top of their recent Verizon expansion, even if they could produce a lower cost iPhone, why would they? The profit margin doesn't make sense and isn't typical of Apple. Of course I could be wrong and Apple may do an iPhone nano but this would also greatly diminish the user experience on the phone and apps experience by minimizing the screen. If you've ever played on an iPad, you'll know many apps work a lot better on the iPad. The screen size do make a difference. Shrinking the iPhone doesn't seem to be helpful in this area. Lastly, Apple is not known for making half assed products with cheap components. Using older components doesn't equate to cutting costs low enough for profit margins on a retail $200 phone to make sense when they're raping $625 per phone as it is now. Would you do it? The economics just doesn't seem to make sense here. |
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Secondly, supply. The iPod is dying, so they'll have capacity coming online there. Anyway, it's worth increasing capacity if it'll give you a strategic advantage.
Thirdly, user experience. The screens on the first three generations have a resolution of 320 x 480 at 163 ppi, while that of iPhone 4 has a resolution of 640 x 960 at 326 ppi. Therefore, they could make a physically smaller screen, using the old resolution, which could run three generations of apps (plus special-purpose ones).
You're right that making half-assed products is not the Apple way. The Apple way is to take a weakness and turn it into a strength. The shuffle example again: the lack of a display enabled it to be tiny, and that's a plus. In general, the iPod had fewer features than its competitors. An "iPhone nano" will do something similar, both in its technical capabilities and how it is marketed. BTW, I think a tinier iPhone would be pretty cool in itself, provided it still feels snappy to use.
Lastly, cost. I agree it might not be possible yet. Perhaps they could go two generations back, or cut costs in a creative way. For example, a smaller screen costs less, and also uses less power, so therefore needs a smaller battery, which again costs less. Perhaps there'll be some cheaper way to do things that is actually a benefit to the targeted customers? Another option is for Apple to wear some loss, for a while, for the strategic advantage. It's also plausible that they'll just wait a bit until it is affordable. It could also be something really wild, like a voice-controlled phone, with no display/controls at all! That would be parallel to the shuffle. It would also be amazingly cool, but I'm not sure whether it would take off...
But one thing I'm sure of: trying to cover the market is on Apple's mind. Whether they can do it yet is the question.