Apple Inc plans to sell a smaller, cheaper version of the iPhone as soon as this year, a person familiar with the plans said, as part of a push to gain customers in developing markets.
Apple, which had been working on a more affordable smartphone since at least February 2011, is weighing retail prices of US$99 to US$149 for a device that could debut later this year at the earliest, according to the person, who asked not to be named because the negotiations are private.
Apple has spoken to at least one of the top US wireless carriers about its plans, the person said on Tuesday.
Executives at Apple have been particularly interested in building a lower-cost model with less expensive components as a way to appeal to customers in emerging markets, another person said.
More affordable models would help Apple play catch-up with smartphone makers such as Samsung Electronics Co who use Google Inc’s Android mobile software system.
Phones running Android made up 75 percent of smartphone shipments in the third quarter last year, compared with 15 percent for Apple, according to International Data Corp (IDC).
Natalie Kerris, a spokeswoman for Cupertino, California-based Apple, declined to comment.
The Wall Street Journal reported on Tuesday that a cheaper iPhone may debut later this year.
Apple chief executive officer Tim Cook has said that the Chinese market is a priority.
Adding a less-expensive version of the iPhone would be a strategy shift for Apple, which has until now tried to appeal to more budget-conscious customers by cutting the prices of older models.
After introducing the iPhone 5, Apple continued to sell the iPhone 4S and iPhone 4 at reduced prices.
The device would use cheaper parts and may be smaller than current models, people familiar with the plans said.
Apple was also considering a more versatile version that would work on multiple wireless networks, according to people who were briefed on the plans.
Apple has sold more than 270 million iPhones worldwide. The device generated US$80.5 billion in sales last year, accounting for more than half of Apple’s revenue.