A Smaller, Cheaper iPhone Is Coming

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Setting the tech world on fire, The Wall Street Journal reported Monday that its sources have confirmed that Apple will be making a smaller, cheaper version of the iPhone. The current specs are that the phone, unofficially dubbed an iPhone nano, will be half the size of the iPhone 4 and half the price for carriers and will be sold starting this summer.

Among the phone's purported details: it may sell for less than $200 without a contract, will feature an "edge to edge" display like rival Android phones, and will will maximize the revamped MobileMe to store music and streaming media. Rumors are that Apple is considering giving away MobileMe access for free or charging a $99 fee. The cloud storage has both fans and critics, with fans saying it's worth the hassle of storing everything in the Cloud to slash the price, and critics calling it a mistake to have virtually no local storage.

Beyond the shiny details, however, the smaller, cheaper iPhone could put the smartphone industry on edge. Although hardcore Apple fans have been willing to swallow the iPhone's high prices, it doesn't own the market: cheaper Android phones are leaving Apple in the dust, and an cheaper iPhone can help Apple go beyond its 3.4% market share in the field.

Entering the smaller, cheaper market could also put pressure on the Nokia-Microsoft partnership. Criticism of the alliance has been pretty thick, but the duo was seen by many as offering some advantages. With Apple now breathing down their necks, ZDNet's Sam Diaz says they have little time to shine, because while they could make an excellent product, it won't matter if "Apple does it first. Or better."

This article is from the archive of our partner The Wire.