Will 'emerging market' iPhone electrify Apple?

Customers and employees celebrate the debut of the iPhone 6s in September 2015 in an Apple Store in Palo Alto, California.
PHOTO: Nikkei Asian Review

SILICON VALLEY - Apple is preparing to launch a smaller, less-expensive version of its iPhone early this year. The US tech giant is apparently positioning the model as a tool for boosting sales in emerging markets, where its standard phones are often out of reach of the average consumer.

By cracking markets dominated by lower-priced phones, the company also hopes to win over new customers for its ballooning content business.

Production of the phone is already under way, according to a source close to the company. The handset is rumored to have a 4-inch display, roughly the same size as that used for the iPhone 5s but smaller than those of the latest models -- the 4.7-inch iPhone 6 and the 5.5-inch iPhone 6 Plus. Parts and specs are said to be similar to those of the current- and previous-generation models.

Although development work for the new phone is said to have been completed by early 2015, the company has been waiting for the best time to begin the marketing push. Apple sees the model as a way to make up for slowing sales of existing iPhones. A more affordable model would likely fare better in China and other emerging markets, where fierce price competition is accelerating among smartphone makers.

Apple tried a similar lower-cost approach in 2013, when it launched the iPhone 5c. However, that entry-level model, which had a 4-inch display and a colorful plastic exterior, did not sell as well as expected.

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