How Would Apple Make A $50 iPhone? [iFixIt Q&A]



Earlier this week, a report surfaced claiming that Apple is currently working on a more affordable model of its iPhone 4, which is set to launch alongside the iPhone 5 later this year. The device will reportedly be aimed at those looking to purchase an iPhone with a tight budget, and will have just 8GB of storage in order to keep costs down.

This got us thinking: how would Apple bring down the price of an iPhone 4 to appeal to low-cost subscribers? How exactly would they make an iPhone 4 that would cost $50 or so with a two year contract? We’ve been speaking to Miroslav Djuric of iFixita popular online repair shop that produces how-to repair guides and tear-downs — to try and find out, and we think we know how Apple would do it. Here’s how.

Apple Could Make A $50 iPhone 4 That Would Still Be Better Than Many Android Phones…

Firstly, we wanted to know whether a cheaper iPhone 4 was really feasible. According to Djuric, there are a number of ways in which Apple could dramatically reduce the price of its iPhone 4: in addition to decreasing its storage to just 8GB, Apple could use a cheaper version of its Retina display — specifically, the one used in the iPod touch.

The Retina display used in the iPod touch isn’t as good as that used in the iPhone 4. Just take a look at the way in which Apple describes the two on its website:

Clearly the iPhone 4’s display is a little more advanced that than of its cousin, and therefore it’s more expensive. Do away with that and use the cheaper one, and our budget iPhone gets even cheaper.

What about that fancy Gorilla glass? It’s possibly Apple could exchange this for a high-quality plastic, or even a metal for the rear-casing. Not only does this reduce the cost of the device, but it would likely also decrease repair costs, because the device isn’t going to break as easily as today’s delicate iPhone 4.

Lastly, do we really need that fancy 5-megapixel camera? Sure, it’s irreplaceable to some of us, but for those who don’t take too many snaps, wouldn’t a 2-megapixel camera suffice? Better yet, how about taking another part from the iPod touch? The iPod touch’s camera is just 0.69 megapixels — making it significantly cheaper once again.

So these are the most obvious ways in which Apple could produce a budget iPhone 4, but when you think about the steps Apple would need to take to implement those changes, it may not prove so cost affective… especially when there’s another, less bothersome way to make a budget iPhone 4.

… But Apple Has An Image To Maintain…

Djuric explains:

“Apple could cut costs by using the existing stock of yesteryear’s processors (aka the A4 processor currently in the iPhone 4) and then implementing less storage, cheaper Retina display, and even downgrading the camera. But some of those changes — especially downgrading the camera — requires their engineers to re-develop the cheaper phone, which may end up costing more money overall than just leaving the phone as-is and selling it as a lesser counterpart to the 5. “

Also, we have to think about the company’s image. Apple is famous for its premium products, built from high-quality materials that are designed to last, and look good. A plastic iPhone 4 that scratches the second you place it on a rough surface and dies every 8 hours because Apple used a cheap battery isn’t going to make for a happy consumer.

“Apple has worked hard on establishing itself as a manufacturer of premium products, so I don’t think there’s going to be a “cheap iPhone 4″ per se. They may employ some cost cutting measures to keep device cost at a minimum, but I do not believe that the iPhone will *look* any different than it does currently. Having said that, I find it unlikely that they will use plastic instead of glass/metal for the phone’s exterior.”

“If Apple changes anything to make the iPhone 4 cheaper, it would be the memory storage. It should be fairly trivial for them to put 8GB instead of 16/32, as that should not require any large engineering effort. That may save them a couple of bucks per phone, so it won’t be a huge per-unit savings, but the savings may add up after selling millions of units. Downgrading the storage capacity will also further enhance the gap between the new and old generations.”

The answer to the question, then, ‘could Apple make a $50 iPhone 4?’ is yes. But will Apple make a $50 iPhone 4? Almost certainly not.

… And Why Bother When The iPhone 4 Is Already Good Enough?

With that being the case, what’s the most likely method Apple will use to make a cheaper iPhone? Well, it’s obvious when you think about it:

“Funny enough, I think the best method for Apple to make a “cheap” iPhone 4 is to release the iPhone 5. They’re immediately going lessen the previous generation’s value without lifting a finger, just like the 4 did to the 3GS. And all of a sudden the 4 will be perfect for folks who want a “value” phone and don’t care about the latest and greatest.”

Djuric’s points make a lot of sense. There’s no way Apple would use low-quality components to cut costs, as previous reports have suggested, that’s just not the way the Cupertino company works. What’s most likely is that it will simply follow the process it has taken with previous iPhones: release a next-generation device and then slash the price of older models.

  • prof_peabody

    Interesting that you say they *wouldn’t* do this when just this morning the Internet is alive with pictures of a plastic back part for an upcoming iPhone model.  It seems they are at least thinking of plastic backs on an iPhone, even if they don’t make it into production.

  • aardman

    No point in selling a cheaper phone if you are selling every phone that you can make right now.  Let’s not forget that Apple is supply constrained.  They are not demand deficient.  Where will they get the capacity to build this cheaper iPhone on top of their current product line?

  • Biotechnology2020

    I disagree…I really think that apple knows that it doesn’t want to turn into the apple of the 90’s against Microsoft. The thing about apple is that it knows blackberry is coming out with a new OS, along with android ice cream sandwich. I definitely see a cheaper iPhone coming out.

  • MattSTKC

    good. I’ll take an 8gb iPhone 4. I don’t need more than that since I have a 64gb iPad 2. I just didn’t want a 3GS. I’m still holding out hope for an off contract version though…

  • MattSTKC

    the plastic back is for the test model that prob gets the crap beaten out of it. they’re not going to waste money on glass for early field test units that prob get dropped a lot. I don’t like the glass back and I’d rather have metal but I still don’t think Apple would go back to plastic unless it was curved.

  • gerenm63

    It’s possible that the plastic part is a “rapid prototype” version of the final part…

  • SbMobile

    When the iPhone 5 is released, the 3GS will go for $0 (2-3 plan) & the iPhone 4 will go for $49-$99. Android definitely can’t beat that! Plus, they’ll still have their 16GB & 32GB storage limits, just with iCloud now! Apple killed the 8GB model because it effects the RAM & processor.

  • SbMobile

    RIM won’t be around long enough to release that new OS, so expect them to rush out something “half-baked”, soon! Ice-Cream Sandwich probably won’t come out anytime soon, because it will unify mobile OS’s (smartphones, tablets & PMP’s), making Apple the #1 mobile OS on the market (iPhone, iPad & iPod). They don’t want that! Apple has NO competition. Last time I checked, these companies were struggling to compete with Apple (they disrupted their business models & have them floundering). iPhone 5 comes out: 3GS = $0 (2-3 yr-plan), iPhone 4 = $49-$99. Is that cheap enough for you? Apple sells “premium” products, NOT bottom-feeder products! RIM & Google can tussle over the “bottom of the barrel”!

  • SbMobile

    iPhone 4 is the best phone any company has ever released! Period. I hope they don’t change the design. Can’t see why they would. This phone sells like “hot-cakes”. I’ve dropped my phone a “zillion” times, from high, low, on the concrete or stony-pavement. No nothing. I’ve seen them break, but it’s the best!

  • Gadgetgav

    They already make a $49 iPhone. It’s called the 3GS. You can get it for $9 as a refurb if you catch them in stock……|||

    The kind of people who are shopping for a $49 phone aren’t worried about the latest and greatest – all they care about it price. I don’t see how anyone who refuses to pay $49 for an iPhone will come on board for $0. They’re probably just anti-Apple and wouldn’t have an iPhone if AT&T paid them $49 to take it.

  • Enoch Cincotta

    I wouldn’t buy it if it had those “downsided” specs.