Confirm that low cost iPhone is in the works.

Seems like Apple has announced in the US market that it plans to introduce a low-cost version of its iPhone soon. On a separate note, it has also announced that Steve Jobs will be ready to return to the helm after his medical leave.

Looks like the rumours were true. A low cost iPhone is in the works. How would they structure it though will be a mystery. Will it be something like the iPod Shuffle? An iPhone with bare minimum functionality? I have 2 lines of thought for this low cost iPhone.

The first line of thought is pretty straightfoward. Strip out some functionalities of the iPhone and create a low-cost alternative. I can think of the following changes in a low cost iPhone:

• No Wi-fi
• No GPS (means no Google Maps App)
  
• Less than 8GB of internal memory (maybe 4GB or lower)

I was thinking of adding reducing the size of the iPhone but it is not feasible due to the minimum size of the on-screen keyboard. I do not think Apple will want to introduce the stylus to the iPhone, and I do not think they will create a brand new Apple OS for a low cost iPhone. It won't make business sense.


I also have another line of thought for a low cost iPhone. The concept is actually quite simple. Use the previous generation iPhone as the low cost alternative. This would make business sense for Apple because:

1. They can reduce their inventories of their previous generations of iPhones and help their partners clear stock.
   
2. Tap the market where users get the previous generation phones due to the lower cost.
   
3. Naturally create a limited supply of low-cost iPhones.

I guess we'll know next week. Looking at the Steve Jobs news, I will not be surprised if he makes an appearance in the WWDC 2009. He might not be presenting the keynote, but he might "show face".