| CUPERTINO, California, Sept 10
CUPERTINO, California, Sept 10 Apple Inc
is expected to introduce a cheaper version of the
iPhone on Tuesday, bringing one of the industry's costliest
smartphones within reach of the masses in poorer emerging
The world's most valuable technology company, which many
expect to unveil an iPhone 5C in several colors alongside the
latest high-end iPhone 5S, is trying to beat back rivals like
Samsung Electronics Co Ltd and Huawei Technologies
Co Ltd in markets like India and China, where it is
fast losing ground.
Wall Street approves of the move to offer a more basic
version of the device, although some investors warned initially
it will dilute margins and potentially tarnish a brand that has
been linked to premium users since its 2007 inception.
Now, they hope a bigger emerging-market presence can help
reverse a 29 percent fall in the company's share price since it
hit a record high of $702.10 a year ago. The selloff was fueled
by fears of slowing growth and a perception that its ability to
innovate and shake up industries was dwindling.
Industry observers said Apple has not turned out a
category-defining electronic device since late co-founder Steve
Jobs made a bet on the iPad in 2010. Speculation revolves around
a smartwatch - along the same lines as Samsung's recently
introduced Galaxy Gear - or some sort of TV product.
But analysts said neither is likely to generate numbers
anywhere in the neighborhood of the iPhone, which supplies half
of Apple's revenue and is its highest-margin product.
"Apple needs to demonstrate in the coming months that it has
other product lines which can start to make up for slowing
growth and falling margins in (the) iPhone and iPad," said Jan
Dawson, chief telecoms analyst for Ovum Research.
"That's a tall order."
More immediately, Apple will get a boost if it succeeds in
enlisting China Mobile Ltd in its iPhone network. For
the first time, the company will host media in Beijing just nine
hours after its Cupertino, California launch, spurring
speculation it will announce a distribution agreement with the
The world's largest wireless carrier serves more than 740
million users and is perceived as more amenable to carrying the
popular smartphone now that profit and subscriber growth are
decelerating. Net income grew just 2 percent in the April to
And smaller rivals China Unicom and China Telecom
- both of which already sell Apple's gadget - are
making headway against the market leader.
Separately, Japan's largest carrier, NTT DoCoMo, is expected
to begin selling it as soon as this fall, other sources said.
One key question is whether Apple will sell its cheaper
iPhone 5C also in more mature markets like Europe or the United
States - heightening the risk that it will begin cannibalizing
sales of the flagship 5S.
Globally, the market for cheaper smartphones priced around
$300 - the iPhone 5 now starts at $649 without a contract -
could grow to 900 million units by 2015, Bernstein Research
analyst Toni Sacconaghi estimated. Assuming Apple manages to
capture just 10 percent of that market, the 5C could bring in
revenue of $30 billion annually.
"The only real potential to surprise investors (on Tuesday)
seems to be in the scope and velocity of a new China strategy,
and any new features within iOS 7 and fingerprint scanner
technology," said Barclays analyst Ben Reitzes.
"Since it missed the trend toward larger screened phones and
seems poised for only incremental iPad improvements, we believe
that Apple needs to prove it can innovate in software and