Apple 'plans cheaper iPhone'

Apple could launch a cheaper version of the iPhone later this year, according to reports.

 A cheaper iPhone has been rumoured for years but, according to reports, Apple could launch the device later this year.

The cheaper handset could be similar to the current model but with a cheaper, less expensive body, the Wall Street Journal reports.

Citing "people briefed on the matter", the Journal says that Apple is considering an iPhone with a polycarbonate plastic case, which would be cheaper to make than the glass iPhone 4 and 4S or the aluminium iPhone 5.

The paper says Apple might still decide not to launch the device but that a cheaper iPhone is needed to help the company compete with cheap smartphones running Google's Android operating system.

Last week, research firm Strategy Analytics suggested that the growth in Android sales, and particularly Samsung devices, could force Apple to release a smaller "iPhone mini".

"Samsung plays in more segments and this should enable it to capture more volume than Apple (assuming Apple does not launch an 'iPhone Mini' this year)," Neil Mawston, executive director of Strategy Analytics, said.

Apple's strategy so far has been to concentrate on profitability rather than market share. Though Apple has released just one new smartphone model each year since the first iPhone in 2007, it does tend to keep older versions of its phone on the market.

The iPhone 4 and 4S are both still available, for example, giving would-be owners a cheaper way to get an iPhone.

While Apple continues to see increased profits, it has missed Wall Street estimates in three of the last five quarters. It is due to announce its Q1 results in two weeks' time.

Though Android-powered mobile phones have increased in popularity in recent years, Samsung remains the only manufacturer that is seeing profits increasing, thanks in part to an advertising spend at least 10 times greater than Apple's.

HTC, the Taiwanese manufacturer which makes Android and Windows Phone handsets, recently announced that it had missed forecasts for the fourth quarter of 2012 and that profits were down 91 per cent, year on year.