New iPhone: Small Price Will Mean Big Business

For months we’ve heard rumblings about the forthcoming launch of the so-called “cheap iPhone” – an affordable entry-level iPhone from Apple supposedly coming to market this year. According to comments Tuesday from Piper Jaffray analyst Gene Munster, that launch could come as soon as September. Munster, Business Insider reports, believes that Apple will quickly secure …   Read More

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For months we’ve heard rumblings about the forthcoming launch of the so-called “cheap iPhone” – an affordable entry-level iPhone from Apple supposedly coming to market this year.

According to comments Tuesday from Piper Jaffray analyst Gene Munster, that launch could come as soon as September.

Munster, Business Insider reports, believes that Apple will quickly secure at least 10% or better of the low-end smartphone market.

A low-end iPhone is generally thought of as an iPhone available for $300, well below the average selling price of $620.

Munster estimates “gross margin goes to 36.6% in CY14 vs. 38.6% in Dec-12. This assumes a $300 ASP, and a 30% gross margin for the cheaper iPhone vs. $620 ASP and a 55% gross margin for the high end iPhone.”

Munster believes high-end iPhone sales will still increase by 6% over the next year.

Apple will announce earnings for the March 2013 quarter next Tuesday, April 23rd.

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