Apple Inc. halved the price of its entry-level iPhone to $99 and rolled out a
next-generation model, looking to sustain the momentum for its popular smart phone
amid the recession and fresh competition.
Apple also announced several new lower-priced notebook computers at its annual
conference for software developers, which kicked off Monday. Chief Executive Steve
Jobs, who went on medical leave in January, didn’t make an appearance.
Toni Sacconaghi, an analyst at Sanford Bernstein & Co., said Apple’s price cut shows
the company is making an aggressive move to “enhance it’s first-mover advantage” by
getting as many iPhone users as it can now despite the cost. He said the $99 price
could increase iPhone demand by as much as 50%.
Overall, Apple has sold more than 20 million iPhones in the past few years. The
device, which has become one of Apple’s main growth engines, has shaken up smart-phone
rivals such as Palm Inc. and Research In Motion Ltd.
On Saturday, Palm began selling a new smart phone called the Pre. While the device
sold well over the weekend, analysts said sales weren’t as strong as for the iPhone
when it first launched.
