For those that ever wondered what the market is like for a lower cost iPhone, take a look at how well the iPhone 3GS is still doing in the market and you will have your answer, as reports from the US indicates that the iPhone 3GS is still the second top selling smartphone, just behind the iPhone 4.
When the iPhone 4 was launched over a year ago it replaced all but one model of the iPhone 3GS, and that was the 8GB model, that have since filled the role as the lower cost alternative in the market. Based on the reported continued success of the iPhone 3GS from The NPD group in the US, keeping that model at a lower cost in the market might have been another stroke of genius from Apple, as they are fighting off an onslaught of more affordable Android based handsets in the market.
I don’t currently have available UK sales figures for the iPhone 3GS, but when comparing the deals available for the iPhone 3GS 8GB compared with the iPhone 4 16GB for example, it shows that there are significant amounts to be saved over the contract period. Whilst you can get the iPhone 3GS 8GB for Free on an 18 month contract with Vodafone costing you about £36 a month, you can get the iPhone 4 16GB for free on an 18 month contract with Vodafone at £41 a month, which over the contract period is about £90 more. It is likely that as we get closer to a possible iPhone 5 launch these prices will come down even further. Depending on the PAYG deals available and the cost of an unlocked device, this might be a better option if you are still in the market for an iPhone 3GS.
Rumors are that Apple has started production of an iPhone 4 8GB that will replace the iPhone 3GS, and be the new low-cost alternative to the next generation iPhone 5 expected out in October. It is however not likely that an iPhone 4 8GB will be at a low enough cost to compete in the prepaid driven emerging market, such as China, where it is likely that a handset will have to be even cheaper outright.