There's a rumor going around this week that Apple is once again working on a cheap iPhone.
The Japanese language Apple fanblog Macotakara sparked the rumor yesterday when they reported that Apple will release a new iPhone in 2014 with a 4.5" screen. This new and larger model will replace the current iPhone (which has 4" screen) and cost far less. Macotakara is quoting the price as $330, and quite a few blogs are repeating that figure without question.
I don't believe it.
This kind of rumor has trotted out several times in the past few years, and I can recall some taking it serious back in 2011, but so far none of the rumors have turned out to be true. And the reason they turned out to be false is that whoever invented them never really thought the idea through before inflicting it upon the world.
According to the rumor, Apple is going to release as their hot new 2014 iPhone a cheaper looking, lower quality iPhone that costs nearly as much to make as the real thing but retails for half the price and is far less profitable.
Why would they do that, exactly?
If someone could explain why Apple would break with their past business model of releasing premium products and reaping premium profits, I would deeply appreciate it. The idea that Apple would want to generate less profit makes little sense to me.