Would a $99 iPhone “dilute” the Apple brand?

I keep reading commentaries on the idea of a $99 iPhone. What surprises me, is that some people seem to think that a $99 iPhone would somehow tarnish or “dilute” the Apple brand.

I can’t for the life of me see why.

A $99 iPhone is a great idea.

Apple has made it very clear (I am once again referring to that last Q conference call – which was very important in my eyes) that they don’t want to leave too much room under the iPhone’s price-point for others to come in and undercut them.

Imagine if they actually did release a $99 iPhone. There would be nothing like the iPhone even CLOSE to that price range. Current rivals are already struggling to keep up. The T-Mobile G1 doesn’t come close to the iPhone in storage, and has a cheap plastic casing – all so they they could come in at $179. The Blackberry Storm is keeping pace at $199 in some outlets, but is more expensive than the iPhone in others.

If Apple was to release a $99 iPhone it would take the device in further away from the competition and virtually guarantee an iPod-like dominance in the mobile market. When I say that I don’t necessarily mean that the iPhone will be 70+% of phones sold, but that the brand awareness, and the identity of the smartphone will be the iPhone, in the same way that MP3 players are iPods.

Will a $99 iPhone come out? Who knows? That could be big reveal at Macworld this year. Personally, I’d love it. It is exactly the thing that Apple needs to do to ensure market dominance in an economic downturn, and I can’t think of one reason why a lower capacity, less expensive iPhone would dilute the brand.

What do you think?

Comments

  1. i don’t see how it makes that big of a difference if the phone costs 99$ or 199$. it still comes with quite expensive monthly rates, and i can’t imagine that people who are willing to pay a monthly bill of 70$ and more will then be put off by the “high” purchase price.

    then again, when it comes to money (especially money you have to pay later), you americans have always been a tad strange… :P

  2. Rick O'Neil says:

    As long as they don’t compromise any of the quality I think it’s a good idea. Though I do miss the days when I was one of a rare few who was walking around with a $600 phone.

  3. @Phil –

    Oh sure – leave it to one of you foreigners to make a “You Americans” joke…. :P

    But you’re correct in that the “pay later” mentality is a huge issue here. The $99 price point is easier for someone of a lower income to come up with and to justify.

    There are hundreds of people everyday getting data plans on $99 Blackberries so they can have a phone with Internet.

  4. I’m pretty much in accordance with Phil. If you’re going to purchase a phone, you are generally locked to that phone for pretty much 2 years. I would want a phone that I would enjoy using and I wouldn’t mind paying the initial price for it. At the moment, I don’t have the ability to get an iPhone because I have Sprint. So, with the exception of the Samsung Instinct, I can choose whatever phone I want without having to change my texting, internet, or talk plan. I would rather pay $300 and get a really nice phone that’s very functional for me and has lots of customization options rather than get a free phone just because I don’t have to pay the $300 up front. I think $0-$300 isn’t that big of a deal when you’re looking at a longer term investment for the better of 2 years and something you’ll be using everyday (and I’m a fairly heavy user so I put more value on it). When it gets to the $400-$600 range, I would question my decision a bit more because that is a sizeable price. When I first heard the first iPhone would come out at $499 and $599, I thought, wow that’s a lot of money just for a phone, but then I checked it out some more and knowing that Apple products are excellent, I would’ve splurged and spent the $599 for the 8gb iPhone when they first came out and upon playing with them in the first week, I definitely would have spent the money for it (if I had AT&T). So now is just a waiting game… I’m not a fan of AT&T’s service and I have such a good monthly plan with Sprint at the moment, I just want a CDMA iPhone to come out :D

  5. Will a $99 iPhone dilute the brand? What a no-issue article, here are a few facts people.

    1. The iPhone is FREE that’s right FREE in the UK with only a 18 month contract.

    2. The iPhone is only €1 in one of the European country – Germany I think.

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