Does an entry level iPhone make sense?

November 2, 2007 at 4:46 pm Leave a comment

     I’ve been thinking about the prospects of an entry level iPhone for a few days now since my source revealed that Apple is planning on introducing one. So I paid a visit to a local Verizon store to check out their current selection of low cost music phones to see what the competition is up to in this segment. Much to my surprise, Verizon, which normally has a less than stellar handset lineup, has readied a very competitive threesome for the holiday season and beyond.

     At the top of the lineup is Voyager which tries to compete with the current 8 GB iPhone with features such as large touch sensitive screen, QWERTY slide-out keypad, and internet browsing. Due to arrive in late November, Voyager will try to slow down the pace of iPhone sales. But the two models that really caught my attention are the Samsung Juke and the LG Venus. Juke is a slim looking 2 GB music phone with a 1.3 mega-pixel camera. Already out with a price just under $100 (after applicable rebates), Juke swivels to reveal the keypad and has decent navigation using a scroll wheel. But the star of the lineup, IMHO, is LG Venus. Due to arrive alongside Voyager in late November, Venus has dual screens (one with touch-sensitive and haptic feedback) and microSD memory expandable to 8 GB. Price just under $150, Venus is already getting good reviews. I should mention that Verizon also has a number of very average music handsets from likes of Nokia, Motorolla and Samsung selling for well under a hundred dollars.

     All of this brings me back to my original question. Clearly handset makers see a lucrative market for low cost music handsets with a 2-4 GB expandable or onboard memory. Sometimes market trends force manufacturers into decisions that they might otherwise not make on their own. Such was the case of the iPod adopting video capability despite repeated denials from the Apple chief himself. So let me answer a question with a question: Could Apple afford to overlook entry into this segment? Apple may not have a choice but to expand the iPhone lineup to include an entry level model to ward off competition and to carve out new revenue growth.



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