Two New iPhones?

Fortune Tech:

In a note issued early Monday, Deutsche Bank’s Chris Whitmore is telling clients to expect both — an iPhone 5 and an iPhone 4S.

“With Nokia and RIMM struggling,” he writes, “the time is right for Apple to aggressively penetrate the mid range smart-phone market (i.e. $300-500 category) to dramatically expand its [total addressable market] and market share.”

As Apple has done in the past, the old iPhone model will go for quite a bit less when a new iPhone model is introduced. Unlocked iPhone 4 prices would also come down. No surprise there.

John Gruber:

Examine the history of the iPod to see how this will play out. They’ll press technologically at the high end, and they’ll expand into the mid-range market with lower priced models. Why not now?

The high end iPod touch was announced after the iPhone. Apple didn’t press technologically at the high end with the iPod touch. It was more that Apple stripped the iPhone down. Although I have voiced differing opinions about this before, I think Apple will continue with a single iPhone model introduction. Why?

Choice. I think having the choice of a $49 iPhone 3GS and a $199 iPhone 4 is good enough. We don’t need more choices. Soon enough we’ll have the choice of a $99 iPhone 4 and a $199 iPhone 4S. The iPhone 3GS might be offered for free at that time if there are any leftover. The Android smartphone market has too many choices and I think that’s a problem not only for customers but for developers, too.

The iPad is a different story. When Apple integrates a Retina Display into the next iPad there is a likely chance that the starting price will not be $499. And this is important. $499 has become a symbolic price point. A point that shows Apple can make the very best tablet and for $499 while making more money than others. Apple will bifurcate the iPad line by adding the iPad Pro: keep pushing the frontiers of the high end while making sure the $499 entry point is kept. The evolution of the iPad is not difficult to ascertain because the writing is on the wall with the iPhone 4. Apple will continue building on its Retina Display brand to distinguish itself from the rest.

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