Apple Retires The iPhone 5, Keeps The iPhone 4s
Most of you are probably familiar with Apple’s pricing pattern for older models in its iPhone line. When Apple announces a new iPhone model, older iPhone models will fill the $99 on contract price point and the free on contract price point. However, this time things have changed. Apple announced not one, but two new iPhone models so what does that mean for its pricing pattern? It means Apple revised it a bit. With the unveiling of the iPhone 5C that now occupies the $99 price point, Apple decided to retire the iPhone 5 and make the iPhone 4S free on contract.
So, what happens is this: the newly announced iPhone 5C will fill the price point that the iPhone 5 would have occupied; the iPhone 4 was also retired but in a surprising move, Apple will continue to offer the 2011 iPhone 4S. As we already mentioned, the iPhone 4S will be offered for free with a two year contract.
This is what probably happened: the iPhone 5S is the current flagship from Apple, being a high end smartphone. The iPhone 5 was probably too expensive to manufacture to justify a significant price drop so Apple decided to keep the iPhone 5′s specs, but with a cheap plastic body that comes in many colors. So the iPhone 5 got discontinue and the iPhone 5C was born. Regarding the iPhone 4, when the iPhone 5C took the iPhone 5′s pricing slot, the iPhone 4S kept the free on contract pricing slot and there was no space for another iPhone, so the iPhone 4 also got discontinued.
As we mentioned, the iPhone 5C shares similar specs with the iPhone 5. We talked about how the iPhone 5C, while being rumored to be a low budget iPhone, is actually a mid range replacement for the iPhone 5 that adopts a strategy that aims to make people pay $99 for it due to many different color variants and better specs, instead of getting the iPhone 4S for free. We believe this strategy could work very well for the iPhone 5C on the US market, but on the emergent Chinese market things may be different, especially with an off contract price tag of $549 and no 8 GB model.
