“Like clockwork, rumors of a cheaper iPhone are back,” my colleague Jared Newman wrote on Monday. Jared was reporting on the latest flurry of speculation that Apple is working on a low-cost iPhone that’s designed to broaden the iPhone’s appeal by making it more affordable. He’s skeptical that it amounts to anything.
As well he should be. Apple pundits love to work under the assumption that Apple must be developing a bargain-basement iPhone — and they most often think that the phone in question is less expensive because it’s smaller than the current model. This theoretical budget mini-iPhone is often called the “iPhone Nano,” an idea that’s so irresistible that it dates back at least to January 10, 2007, the day after the first iPhone was announced.
Why do these rumors keep resurfacing? Usually, it’s because of alleged evidence from the Asian supply chain that provides Apple with phone components, a notoriously shaky way to figure out what’s on the way. And the analysts who cover Apple have a weird predilection to conflate their own theories and desires with fact, leading some of them to breathlessly conclude — year after year — that the iPhone Nano is about to arrive. Mostly, it seems, because they think it would be a swell idea.
Let’s review almost five years’ worth of this saga, shall we?
The story: “Apple prepping a cheaper iPhone? Probably,” by Ross Miller for Engadget, June 19th, 2007 — ten days before the original iPhone went on sale
The scuttlebutt: “market resources” rumors suggest that Apple is working on a low-cost iPhone
The evidence: American Technology Research analyst Shaw Wu thinks it’s inevitable if Apple wants to match the iPod’s success, and he’s heard about cheap iPhone prototypes
The outcome: Apple didn’t release a less costly variant of the iPhone
The story: “iPhone Sales Success to Get Smaller With New Version?,” by Daniel Arnall of ABC News, July 10, 2007
The scuttlebutt: Apple is working on an iPod Nano-like “iPhone Nano” with a scroll wheel, designed to sell for around $300
The evidence: A “channel check,” an Apple patent and extrapolation by JPMorgan analyst Kevin Cheng
The outcome: Apple did not release an iPod Nano-like iPhone with a scroll wheel
The story: “Apple hopes to entice customers with cheaper, smaller iPhone,” by Bobbie Johnson and Richard Wray for the Guardian, June 8, 2008
The scuttlebutt: Apple is about to announce a smaller iPhone with 3G capability, which will be free with certain contracts
The evidence: unspecified sources had “confirmed a number of important details to the Guardian”
The outcome: Apple did announce a 3G iPhone, and it was available for free in the U.K. on plans costing £45 and above. It wasn’t, however, smaller. In fact, it was just a skosh larger than its predecessor
The story: ”Apple to launch the iPhone “nano” in time for Christmas,” by Simon Fluendy for the Mail Online, August 2, 2008
The scuttlebutt: By the holidays, Apple will release a £150 iPhone “Nano,” possibly with a candy-bar shape and a touch wheel on the back that lets you dial numbers from behind
The evidence: a thin gruel of rumors from unnamed industry sources and experts, seasoned with random speculation
The outcome: Apple did not release a Nano-like iPhone with a touch wheel on the back
The story: “Apple to launch cut-price version of iPhone,” by Joseph Menn for the Financial Times, June 5, 2009
The scuttlebutt: “as soon as Monday,” Apple will announce an iPhone for either $99 or $149, down from $199
The evidence: information from “people familiar with the initiative,” and Morgan Stanley analyst Kathryn Huberty
The outcome: hey, Apple did announce a $99 iPhone! But not on the following Monday. It didn’t slash prices until a year later, and when it did, it did so by knocking the year-old iPhone 3GS down to that price
The story: “Report: Apple to launch Verizon iPhone in Q3 2010,” by Prince McLean for AppleInsider, November 6, 2009
The scuttlebutt: in the third quarter of 2010, Apple will release a worldphone version of the iPhone, compatible with both GSM and CDMA networks, which will have a “significantly smaller” 2.8″ screen
The evidence: a report from research firm OTR Global
The outcome: Apple did release an iPhone for Verizon. But it wasn’t a worldphone and it didn’t arrive until February, 2011. And it had a 3.5″ screen, not a 2.8″ one — just like every other iPhone before and after
The story: “Apple predicted to introduce lower cost iPhone models in June,” by Neil Hughes for AppleInsider, February 26, 2010
The scuttlebutt: Apple will make the iPhone even more accessible to even more people by introducing a cheaper new model in June; it may also have unspecified new “gesture-based technology”
The evidence: speculation by Morgan Stanley analyst Katy Huberty (the same Kathryn Huberty who expected Apple to release a cheaper iPhone in 2009)
The upshot: Apple didn’t release a lower-cost iPhone, and still hasn’t — unless you count the iPhone 3GS, which is now free with a two-year contract
The story: “Apple developing new iPhone form factors, close to release?,” by unspecified author for Electronista, October 6, 2010
The scuttlebutt: Apple is working on both a bigger iPhone and a smaller iPhone, so it has something for everybody from entry-level to high-end consumers — and they might ship sooner than Apple’s normal refresh cycle
The evidence: supply-chain checks by analyst Shaw Wu, the guy who started predicting a cheaper iPhone before the first iPhone went on sale
The outcome: as of April 23, 2012 — let’s see, it’s 6:03pm my time — Apple still only sells the iPhone in one size, although it does offer three models (the 4S, the 4 and the 3GS)
The story: “Apple Is Said to Work on Cheaper, Smaller iPhones,” by Peter Burrows and Gregory Bensinger for Bloomberg, February 11, 2011
The scuttlebutt: Apple is working on an iPhone that’s one-third smaller than the current model, with no home button; it’s designed to sell for $200 without a carrier subsidy, might be out by midyear and is intended to help the company do battle with Google’s Android
The evidence: reports from “people who have been briefed on the plans”
The outcome: no such phone has been announced yet (and to be fair to Bloomberg’s reporters, they note that it might be delayed or canceled)
The story: “Photos claim to show Apple’s lighter, cheaper iPhone 4 prototype,” by Neil Hughes for AppleInsider, July 28, 2011
The scuttlebutt: Apple is working on a cheap new iPhone, very much like the iPhone 4 but with plastic panels instead of glass — and it may be faster
The evidence: photos and commentary by a poster on a Vietnamese website
The outcome: When the iPhone 4S was released the following October, Apple did cut the price of the iPhone 4 to $99 — but it’s the same iPhone 4 that had been $199, not a new variant
The story: “Entry-level ‘iPhone nano’ again rumored to launch this year,” by Zach Epstein for BGR, April 23, 2012
The scuttlebutt: Apple is working on an inexpensive iPhone for cost-conscious customers; it could arrive along with the next-generation iPhone later this year
The evidence: supply-chain rumors as reported by the China Times
The outcome: um, it’s still April 23 as I write this, so let’s give this one more time
My head is spinning from all these imaginary details on a non-product, although it’s certainly possible that some of these articles report on actual prototypes that Apple has toyed with and rejected. But you’d think by now that everyone involved would have figured out that glimmery hints of the iPhone Nano’s possible existence do not amount to solid evidence that it’s about to be announced.
The funny thing is, Apple started releasing cheaper iPhones almost immediately, and has never stopped It lowered the original iPhone from $599 to $399 in September 2007, less than two months after the phone’s release. In June 2008, it switched to subsidy pricing to bring the up-front cost for the iPhone 3G down to $199. In 2010, when it announced the iPhone 4, it kept the 3GS on the market at a new low price of $99. And last year, when the iPhone 4S arrived, the 3GS stuck around as a free phone.
All those analysts and other rumormongers are right: it makes a lot of sense for the iPhone to get more affordable. It’s just that their theories about how Apple’s going to accomplish that have been consistently misguided. Even though there’s nothing top-secret about the company’s cost-cutting strategy to date.
Which is why, if Apple ever does release an iPhone that’s been radically rethought with a lower pricetag in mind, it won’t be impressive that Apple-watchers predicted that it was on the way. Instead, as with an awful lot of professional Apple analysis, it’ll be embarrassing: how could so many experts be so wrong for so long?