iPhone is still in its infancy (not even a month old yet), and already rumors are flying that it could soon have a younger sibling. A Reuters report on Monday said that Taiwan-based JP Morgan analyst Kevin Chung has connections in the supply channel who claim an iPhone based on the iPod Nano is already in the works.
Chung apparently issued a report on July 8 in which he cited both his supply channel contacts, and a patent application filed July 5 with the U.S. Patent and Trademark Office, as evidence that the iPhone Nano is in utero.
According to Chung, Apple plans to convert the iPod Nano into an iPhone because “it’s probably the only way to launch a lower end phone without severely cannibalizing iPod Nano,” the Reuters report quoted him as saying.
Chung predicts the iPhone Nano will sell for $300 or less and, perhaps predictably, have “rather limited functionality.”
This claim of Chung’s is backed up, Reuters said, by another analyst—Gene Munster of Piper Jaffray. Jaffray reportedly predicted that Apple plans to release iPhone-like iPods later this year.
Hmm… so the idea is to market the lower-end products as “iPods with a phone” rather than “a phone with an iPod.” Is this a distinction that people will care about? I’m not so sure. If people want a music player, and are willing to shell out more bucks for both added functionality and coolness, they’ll buy an iPod. If they want a phone and an iPod, maybe they’ll buy an iPhone instead.
Does any of this surprise me? No, not really. Of course Apple will, at some point, release a lower-end model. The company is not stupid; it knows, just like the food company that supplies essentially the same cereal in two different boxes, one ‘store-brand’ and one ‘brand-name,’ that it can sell more units if it offers different levels of functionality at different price-points.
Look at Apple’s iPod line and you’ll get a pretty good sense of how iPhone’s different models will probably look. You’ll have the basic phone that only makes calls and plays music. Then you’ll have higher-end models with different amounts of storage space that do all the cool things the $600 iPhone does now.
The only question in my mind is how long it will be before Apple brings the younger iPhone siblings to gestation. Later this year? Sometime in 2008? I can’t see it happening before the holiday season, which actually would be a great time to roll out a new product, don’t you think?
This does seem to be a somewhat baffling strategy. Perhaps they are trying too hard to hedge their bets? It disappoints me a little in that it almost seems like a step backwards, at least if it involves a reduction in physical size (as the Nano did. Of course, I’m not sure that will be the case -- perhaps it’s simply a smaller amount of memory). The whole point of the iPhone, it seems to me, is to introduce the world to a single device that incorporates all of the various technological functions we currently use: phone, mp3 player, video player, and internet connection. And if you remove any of these capabilities, you aren’t really still moving forward. My Sony Ericsson Walkman, for instance, has all of these qualities, but it doesn’t access normal web pages, only mobile versions. The Iphone then stands as a move forward. If it comes with too small a screen to access anything other than mobile internet pages, it is simply another phone on the market. And perhaps Apple wants to compete in other sectors, but frankly I’d rather see them invest more time into making the leap forward they’ve already made affordable, or at least trying to come up with the next leap.
obviously still no iPhone nano around, but plenty of iPods. :)