Economixer

There Won’t be Two iPhones

There has been a lot of talk on “the blogs” that Apple will release two phones at their next event. The idea is that they will release a “mid tier” iPhone 4 GS alongside an iPhone 5. This will never happen because Apple is a competent tech company. It is a question of industrial organization.

Apple figured out long ago that diversifying the product lineup to cater to every edge case, every income bracket, and every preference is a waste of productive capacity and confusing to consumers. It complicates up production and fulfillment. Remember, Apple does not employ the fashionable and supposedly advanced policy of “just in time” production. Rather, they plan and allocate resources years in advance, leaving other firms overpaying for touchscreens and other critical components on the spot market.

Most importantly, the iPhone 4 is still bar-none the best phone on the market. Research in Motion is in its death throes, and Microsoft is releasing phones that lack total landscape/portrait orientation in 2011.

Android has a lot of market share, for now, but the fragmented nature of their phone lineup does not bode well. Apple doesn’t NEED a mid tier phone between iPhone 4 and 5.