Despite recent reports that suggest Apple is working on a smaller version of its iPhone, “people briefed on Apple’s plans” have told the New York Times that although the company is looking into offering a cheaper model of the device, it will not be smaller than the current size. One source said that the company is hard at work on the next-generation Apple smartphone and that it will be similar in size to the iPhone 4, and another confirmed there wouldn’t be a smaller device, because:
A smaller device would not necessarily be much cheaper to manufacture and because it would be more difficult to operate.
One source, who is direct contact with Apple, also added that the company doesn’t want developers to have to rewrite their applications. This is something we pointed out in an earlier article regarding the smaller device – due to its smaller screen, and probable slower processor, current App Store apps and games would not be compatible.
The Times article cites a senior Apple executive who said making multiple iPhone models would not make sense for the company. During the private meeting the executive also confirmed that the company would continue to sell previous-generation devices at a discounted price.
It is believed that Apple is developing a less expensive iPhone in an attempt to compete with popular low-cost Android devices. Piper Jaffray, an analyst of Gene Munster. Sanford C. Bernstein & Company, believes a cheaper iPhone available without a contract is critical to Apple’s growth overseas:
If they are going to be a player in the global market they have to have a prepaid option.
One of the Times‘ sources also spilled some beans on the work Apple is doing to improve its MobileMe service, which many subscribers have been unsatisfied with for a while. It seems we could see a free, “more versatile” version of the service that would allow users to wirelessly sync data, including media, across all of their Apple devices. This ties in with rumors that the cheaper iPhone will not feature any physical storage, and that all of its data will be pulled from ‘the cloud.’