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Analyst says free iPhone would double Apple’s market share

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In a note to clients — as reported by “Forbes” (http://macte.ch/hPpGo) — RBC Capital analyst Mike Abramsky — says Apple could double its smartphone market share by offering a free iPhone 3GS. (My take: this will never happen.)


“As its entry-level iPhone strategy, Apple is expected to cut iPhone 3GS to $0 (on contract, $399 unsubsidized) in conjunction with iPhone 5 launch,” he says. “This approach is intended to target mid-market smartphone buyers and counter Android’s mid-market expansion.”

Abramsky expects the iPhone 5 to launch at US$199 and $299 on a subsidized basis, with the iPhone 4 dropping to $99. Apple already sells the 3GS for just $49, but Abramsky adds that a free iPhone “provides a compelling offer.”

He writes that a proprietary survey of finds a free version of the phone would double the company’s global market opportunity and re-accelerate iPhone share growth outside of North America. Meanwhile, the analyst writes that he continues to expect Apple to launch a smaller, pre-paid version of the phone in 2012.

— Dennis Sellers

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