Apple to give iPhone 3GS a new lease of life

Apple has made a deal with a 'major global distributor' for cheaper iPhone 3GS aiming at prepaid phone market - analyst

Despite being three years old, Apple believes that the iPhone 3GS still has some life left in it, according to reports.

In a research note, Jefferies & Company analyst, Peter Misek, claimed that Apple has signed an agreement with a "major global distributor" to make the iPhone 3GS cheaper, targeting the prepaid phone market, reports Forbes.

Misek said the iPhone 3GS's wholesale price will be reduced from its current cost of $US375 to between $US200 and $US250.

Misek also believes that Apple will produce between 28 million and 30 million iPhones in the June quarter, saying that the Wall Street's estimates of 26-28 million units of the iPhone doesn't account for production of the iPhone taking place in the new Brazil Hon Hai plant.

Computerworld blogger, Jonny Evans, said that Misek's prediction about Apple's contract-free and prepaid phone plans makes sense, quoting Apple CEO Tim Cook, who said at a Goldman Sachs event in February: "In most of the developed markets, the carrier owns most of the distribution themselves, but in the emerging markets, the retailer has a significant proportion of the distribution. And so, the whole go-to market has to be changed significantly as you go in there."

The iPhone 3GS will be three generations behind when the iPhone 5 arrives, which looks to be on target for an October launch.

Read more about the iPhone 5 here.

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Ashleigh Allsopp

Macworld U.K.
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