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Sunday, June 7, 2009

Apple plans price cut to boost demand

I was planning to upgrade my mobile phone and was looking at what's available on the market before venturing to any brick and mortar store. While browsing for news about the Apple iPhone I came across a very interesting news which, if confirmed, will probably have me waiting a little bit more before upgrading.

Apple is planning to expand it market share in the smart phone market as it is thought that next Monday it will be announcing the launch of its new iPhones which will be priced at around $50 or $100 less than the current US iPhone price of $199.



Apple currently accounts to about about 11 per cent of the world’s smart phones market, trailing behind Nokia’s 41 per cent volume and Research in Motion’s 20 per cent, according to Gartner figures from the first quarter.

The news, of the new cheaper iPhone is expected to be divulged by apple during the developer conference, a conference which Apple usually uses to introduce most of their products. However till today, Apple has declined to comment the news which has been widely reported in all international media. The much awaited conference, begins on Monday with a keynote speech by senior vice-president and marketing chief Phil Schiller. Reports are also spreading that during the conference it will also be announced that founder Steve Jobs is planning to return to work after a period of medical leave.

Coming back to the new iPhone, with the price reduction of $100 Apple is expected to increase demand by 100%. The production of the new iPhone is expected to start in July. While iPhone and Apple enthusiasts will be longing to see the latest product from Apple, competitors such as Palm (which was famous for its PDAs in the 90s and is aiming to revive its fortunes and take market share from Apple) will not be very happy to hear this news.

I believe that the latest price cut could lead the mobile market to grow again as users start switching from less functional mobile phone sets to the latest and now cheaper Smart Phones.

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