The biggest surprise of yesterday’s iPhone 5c announcement is that it isn’t really cheaper. In many emerging markets, consumers buy phones unsubsidised. In these market, the iPhone 5c will be about USD$549 and the 5s will be about USD$649. The iPhone 4s stays on the market as the cheapest iPhone at USD$450.
Meanwhile, cheap Androids from Samsung cost from less than USD$100 in India for example.
This pricing shows that, as usual, Apple have stayed closer to their DNA than pundits predict. The iPhone 5c is another high-margin product that shows no significant compromise in hardware spec or software experience. Apple have restricted a few hardware-led features to the 5s like fingerprint scanning and some camera technology, but the software experience will not be significantly differentiated within the iPhone range.
Rather cheekily, let me point out that this case shows good support for my dilemma of luxury technology. Facing the gulf between hardware price and software value, Apple kept prices high and didn’t chase the global mass market. The value in mass market smartphones is still being captured by Android.