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Apple’s iPhone ‘surprise’ may lie in pricing


SAN FRANCISCO — Apple Inc. may not have any surprise products up its sleeve for its much-anticipated event this week, but the company is expected to unveil key details that investors deem vital to its outlook.

Apple is widely expected to unveil two new iPhone models at an event set for today at its headquarters in Cupertino, Calif. The event is also expected to feature a launch date for the iOS 7 mobile operating system, as well as expansion of the roster of wireless carriers that sell the iPhone — including the addition of China Mobile to that list.

But the bigger question remains how much the company plans to charge for a new, lower-cost version of the smartphone that has been widely dubbed the iPhone 5C. The company needs to prove the iPhone can break into new, more price-sensitive markets while maintaining its strong position at the high end of the smartphone value chain, which offers lucrative profit margins but limited sales growth.

Analysts who cover Apple say this will be a key data point in helping to turn sentiment on the stock, which has surged more than 25 percent since late June but remains well below its peak above $700 when the company launched the iPhone 5 about a year ago.

Tuesday’s event is also expected to include a launch date for iOS 7 — a redesigned version of the iPhone’s mobile operating system that is expected to become available with the new iPhones.

Apple is also hosting another event in Beijing later in the day that is expected to add China Mobile to the lineup of wireless carriers selling the iPhone.

The iPhone 5C is also expected to become Apple’s main tool to grow its share in China and to break into emerging economies.

“In general, the unsubsidized price is a big deal in these markets,” Munster said, adding: “You’re going to see Apple get more aggressive on margins in exchange for market share.”


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