Apple to go budget with $99 iPhone?


An RBC Capital Markets investment analyst play fortune teller in saying he expects a budget iPhone to be released this summer. The June/July release will accompany a new 3G flagship iPhone. The budget iPhone will run on AT&T's 2.5G wireless system, rather than the speedier 3G, however, may come with a lower price, even lower than the original iPhone $20 plan. A new $15 plan would cater to light data users and will cut month service fees, however, may not be all-you-can-eat network.

Furthermore, RBC Capital expects the new iPhone 3G to come at the same price points with some new features. Namely a larger touchscreen, video camera, and bump in storage memory.

The prediction isn't earth shattering, but Apple did state that it doesn't plan to go after the budget cell market. The lower-price device, however, could be particularly attractive to iPod owners looking for a new cell phone who were otherwise unmoved by the iPhone, also a budget entry for a tough economy. The entry device would certainly boost iPhone numbers, even if it's at the cost of iPod sales. Also, Apple's margins would take a hit, but in tight times, such a strategy would probably pay dividends down the road.