Apple May Launch iPhone Mini This Summer According To Analyst

According to Katy Huberty, an analyst at Morgan Stanley (an American multinational financial services corporation), a possible scenario where the worldwide smartphone market leader Apple launches a new model of its iPhone line in China, the iPhone mini, priced at $330 will provide a considerable boost to Apple’s Chinese iPhone sales.
This possible scenario suggests that an entry level priced iPhone mini would increase the current 10 percent Chinese market share of Apple’s iPhone 5 to 20 percent, according to Morgan Stanley’s analyst yesterday. At the moment, Apple sells its iPhone line of smartphones in China through two carriers: China Telecom and China Unicom. However Apple has been trying for a long time to make a deal with China Mobile (which is China’s largest carrier) but apparently there have been all kind of difficulties in making the deal, difficulties in the form of both technical issues (like the fact that neither the iPhone 5 or the iPhone 4S are compatible with the TD-SCDMA network used by China Mobile) and business issues.
Even with these difficulties, that prevented a deal between Apple and China Mobile from happening in the past, the analyst says China Mobile will play a very important role in iPhone’s growth on the Chinese market. The analyst offers a few reasons for this claim: one of them is that Apple would release a new iPhone model, the iPhone mini. Another important aspect is that, according to the analyst, the legislation for TD-LTE licenses could pass in the second part of this year or during the next year. Finally, the third and last factor suggests that China’s largest carrier, China Mobile, would likely back high end smartphones if the TD-LTE license will pass.
In an investor note yesterday, the Morgan Stanley analyst said “We believe Apple could launch iPhone Mini at $330 (about Rmb 2,000), in-line with flagship products in China from Lenovo, Huawei, ZTE, and Coolpad, [...] Even in a scenario of low 40 percent gross margin and 1/3 iPhone cannibalization rate (flattening legacy iPhone shipment growth), which we view as conservative, the iPhone Mini adds incremental revenue and gross profit dollars.”
The same investor note suggests that the unlocked price for the new smartphone in China would be $330. Also, the new iPhone mini would be launched during this summer and it will target not only China but also other emergent markets. These rumors of a low priced smartphone from Apple started to appear even before yesterday’s investor note – since last month actually, after Bloomberg and The Wall Street Journal suggested that a mini model of Apple’s iPhone line might become a reality.
Katy Huberty from Morgan Stanley is not the first analyst to hint at a low price iPhone; there were other analysts that suggested the same thing before yesterday’s investor note. For example, Neil Mawston, an analyst from Strategy Analytics (a global research and consulting firm) said in January that an iPhone mini is due for the next year and not for 2013. He believes Apple will be forced to launch an iPhone mini, but this will happen at the earliest in 2014.