The new iPhone 5C stands for “China,” “Color” and “Cheap.”
Apple is expected to unveil the long-awaited budget iPhone 5C alongside the fully loaded iPhone 5S at a special event on Tuesday.
The C-class phone is viewed as the key to Apple’s growth in China — so much so that the company could end up selling it exclusively overseas, keeping the colorful, cheaper iPhones out of the hands of US consumers, analysts say.
Some even noted that the “iPhone 5C” could be mocked as meaning “cheap” in the English language. If it were an exclusive to China, then the C’s meaning would be clear.
It’s a “highly reasonable strategy” for Apple to sell the 5C in China, and offer only the high-end iPhone in the US, said analyst Colin Gillis of BGC Partners.
“Why would Apple want to hurt its average selling price in the US?” Gillis said.
The iPhone 5C, expected to come in a variety of bright colors, is likely to sell for between $400 and $500, without a carrier subsidizing the device on a two-year contract.
Where exactly the phone will be distributed is still a mystery, but Apple has set up its first Beijing product launch for Wednesday, after the company hosts its usual San Francisco event.
Yesterday, it was revealed that Apple has reached a crucial deal with China’s largest wireless carrier, China Mobile. Its 740 million subscribers are key to propelling Apple’s next big growth spurt, according to Wall Street.
“China is arguably the most important market for Apple right now as the company tries to regain share it has lost to low-cost manufacturers,” Barclays analysts wrote in a note to clients.
Apple developed the iPhone 5C to capture the less developed markets, where Samsung and other Asian manufacturers are beating it on price.
“Positioning the iPhone 5C as a low-cost phone will enable Apple to capture additional sales for the more price conscious consumers in developing economies,” according to the Barclays report.
Of course, there are plenty of budget-conscious consumers in the US who would clamor for a new low-cost, plastic version of the popular iPhone.
“There is clearly demand for the iPhone 4 and 4S because people are buying them for almost nothing,” Gillis said. “So, people are buying two-year-old technology, why not let them have access to new phones at the same price point?”
At Tuesday’s product launch, Apple is also set to show off a metallic gold-colored iPhone, to shore up the luxury end of its brand.
Also, fingerprint technology is expected to come with the new phones for added security.
Apple has already shown off its newest mobile software iOS 7, which will come with the new phones and be available for download updates on older models.