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Fourth generation iPhone to have a lower total cost of ownership?

Updated Dec 19th, 2018 6:33PM EST

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In a note to investors, Morgan Stanley analyst Katy Huberty predicts that Apple will introduce a new iPhone model which will set a new standard for affordability. Huberty maintains that cost is the largest barrier to greater iPhone adoption and believes Apple will address this shortcoming during its next iPhone announcement expected at WWDC in June. Whether Apple can undercut the low $99 price point for the 8GB iPhone 3G remains to be seen, but Huberty’s prediction takes into account the total cost of ownership, not just the initial handset cost. Apple could potentially trim the overall cost of its handset by negotiating low monthly data rates with carriers as it did with iPad, reducing the length of the contract, eliminating any upfront costs like activation fees, or even offering the iPhone as a standalone device with the option of a prepaid plan as has been done recently with the SIM-only tariffs in the UK. The latter, of course, would only happen if hell freezes over if Apple and AT&T are willing to loosen their grip on the iPhone in the US. Then again, we’ve taught better than to take what analysts say as fact.