iPhone 4S/5 To Be Announced With Cheaper Version?

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The iPhone is a great smartphone, maybe the greatest smartphone out there, but where it can’t compete with the dozens of Android devices is price. Because Android phones are made by different manufacturers, there are $100, $50 and free Android phones available on every carrier. But, as rumors for the next iPhone, financial investors and analyst on Wall Street say that Apple needs a cheaper iPhone to stay ahead of the Android army.

Apple products are never cheap. In fact, they’re quite expensive. Compare the specs of a MacBook Pro to a Dell with a similar processor, RAM and graphics and you’ll find the Apple product carries a hefty premium. People pay that premium for the Apple style, design and stability of the operating system, and that applies to the iPhone too. But, while investors have traditionally loved Apple for being the “Mercedes-Benz of electronics”, some are telling the company they should produce a cheaper iPhone.

The Wall Street Journal wrote Tuesday that Apple will need to come out with a cheaper, alternative iPhone in order to protect itself from the Android mobs out there. Call it the iPhone Nano or whatever. Apple runs the risk at this point of mirroring what happened in the PC space where they hold 10% of the marketshare and the other 90% is held by Microsoft. Except, in this case, the 90% would be Android and Google.

The ‘Journal’s urging of a cheaper iPhone comes on the rumors that Apple will be offering a prepaid version of the iPhone for just $350, contract-free (the regular iPhone 4 is in excess of $600 without a contract). AT&T is also offering a refurbished iPhone 3GS for just $9 with a new contract, though selling used phones doesn’t exactly help Apple’s bottom line.

Do you think Apple will announce a new smaller iPhone (iPhone Nano)? Do you think they need to? Tell us what you think in the comments section.