Apple to offer two new iPhones with one less expensive to take on android phones - Economic Times

By: Brian X. Chen SAN FRANCISCO: The handset market is so brutally competitive that Apple, the most successful smartphone maker, is preparing to step up its game this week by offering two new iPhones instead of one. At an event Tuesday at its Cupertino, Calif., headquarters, the company is set to unveil for customers worldwide a new iPhone with a faster processor, along with another model that will be sold at a lower cost. The release of the less-expensive iPhone comes as the growth of the company's profits has slowed in response to a saturated handset market in America and parts of Europe. Many people own a smartphone and are not upgrading as often as before. A lower-cost smartphone could allow Apple to expand into overseas markets - especially China, where the iPhone has been highly desired among many consumers but out of reach because of its price. "A cheaper model will open up the market significantly for Apple," said Chetan Sharma, an independent telecom analyst who consults for phone carriers. Apple declined to comment on the new products. But analysts expect the higher-priced model to be an improvement over the current iPhone, including a faster processor and better camera flash, as well as a fingerprint sensor for security. The second iPhone is expected to be a cheaper version of the soon-to-be-outdated iPhone 5, coming in a variety of colors, with a plastic case instead of aluminum. Analysts expect the full price of the lower-cost iPhone to be $300 to $400, positioning it as a midtier product. Apple has been enormously successful, with the iPhone driving most of its revenue. In the second quarter, the company took 53 percent of the profit in the global smartphone market, with Samsung Electronics, which uses Google Android software to run its smartphones, taking the rest, according to a survey by Canaccord Genuity, an investment bank. But both Apple and Samsung face a common enemy: the tide of manufacturers that produce dirt-cheap Android phones. While they make all the profits, Apple and Samsung have seen their combined share of the worldwide smartphone market drop to 43 percent in the second quarter from 49 percent a year earlier. The makers of cheaper phones - including Huawei, Yulong and ZTE of China, and Micromax and Karbonn of India - are raking in sales in emerging markets where high-end smartphones are not popular. "We've had several indications from the handset market that vendors are in real trouble," said Tero Kuittinen, an analyst for Alekstra, a mobile diagnostics firm. "The biggest threat to all the companies seems to be the low-end Androids." Copyright © 2013 Times Internet Limited. All rights reserved. via Technology - Google News http://news.google.com/news/url?sa=t&fd=R&usg=AFQjCNEmiQujTLDtoa1O1eYB80LqK0RhbQ&url=http://economictimes.indiatimes.com/tech/hardware/apple-to-offer-two-new-iphones-with-one-less-expensive-to-take-on-android-phones/articleshow/22431705.cms

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