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August 20, 2013 07:14 pm GMT

The iPhone 5C Isn't For The US; It's The iPhone For The Rest Of The World

plastic-iphoneReports suggest that Apple will introduce a cheaper plastic-bodied iPhone 5C on September 10. The 4-inch phone will supposedly replace the iPhone 4 and the iPhone 4S in the product lineup. While the company will certainly gain market share in the lower-end spectrum of the smartphone market in the U.S., it’s just a side effect. The new model is the perfect iPhone for the rest of the world. In many countries, carriers are switching to unsubsidized, SIM-only plans and the iPhone is too expensive for regular people. U.S. carriers are the exception, not the rule. AT&T, Verizon and Sprint won’t bill you less if you bring your own phone. It’s the same for Canada. But in Europe, you can choose between a standard subsidized plan and a much cheaper SIM-only plan. For example, in France, you get unlimited talk, text and data (with a speed reduction after 3GB) for $25 per month (19.90). The only downside is that you have to pay full price for your phone. The same thing is true for the U.K., our own Natasha Lomas currently pays $23 (15) for unlimited talk, text and data. And you can switch carriers whenever you want. T-Mobile is trying to bring the same experience to the U.S., but its prices don’t come close to what European carriers provide. Would you pay $900 upfront for a 16 GB iPhone 5? The European market shift happened a few years ago. Instead of seducing customers with cheap subsidized phones, young and scrappy carriers like Free chose to lure customers away from expensive plans, and it worked. These new plans weren’t just marginally cheaper, they were one-half to one-third the cost. Now, there’s no coming back. Unsubsidized plans will only get more popular every year. In France, they now represent 39 percent of the phone subscriber base — with 74.8 million active SIM cards, it isn’t a small market. Yet, would you pay $900 (679) upfront for a 16 GB iPhone 5? If you do the maths, it is much cheaper than switching back to a subsidized plan. Moreover, most people don’t want to see expensive bills again on their bank statements. The only option now is to swallow the $900 pill or pick another phone. It’s hard to convince yourself that you need the latest iPhone if you only check your emails and Facebook and take some Instagram pictures. Most people don’t

Original Link: http://feedproxy.google.com/~r/Techcrunch/~3/JSEyL9tJQKA/

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