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Report: Cheaper iPhone, Better MobileMe Forthcoming

iPhone related rumors have been swirling (as they do) for the past few days, about the oft-predicted-and-never-delivered “iPhone nano.” In fact, we wrote about it just last week. Today, The New York Times weighed in on the subject making two interesting claims. Firstly, that a forthcoming iPhone will be cheaper, though not smaller. Additionally, and perhaps more tantalizing, is their claim that MobileMe will be refreshed, perhaps becoming a more robust free service.

The argument against a smaller phone is rather logical, and doesn’t really need an anonymous source to back it up. From the Times:

Another person who is in direct contact with Apple also said that the company would not make a smaller iPhone at this time, in part because a smaller device would not necessarily be much cheaper to manufacture and because it would be more difficult to operate.

More important, a phone with a smaller screen would force many developers to rewrite their apps, which Apple wants to avoid, the person said.

New iPhone adopters often struggle with what I like to call “cod thumbs,” where dual-thumb typing is incredibly difficult and feels more like slapping two live fish against the screen than accurately hitting keys. A smaller screen would only exacerbate this issue, likely driving away would-be converts.

Finding a cheaper price point is certainly of interest to Apple. As the report points out, carrier subsidies are not as common outside the U.S., making the already high-end iPhone prohibitively expensive in other countries. If Apple is serious about developing an international market for their iOS devices, they must find a way to lower costs.

The second point, about how a change in screen size would affect the apps for the iOS platform, is an even stronger argument against a smaller iPhone. Apple has relied on its robust app store to drive much of their sales, and development for iOS has in no small part been spurred by its consistency. Developers know exactly what their product will look like and what assets will be available when they develop for iPhone/iPad. This has neatly sidestepped a major issue with the Android marketplace, in that with so many different hardware options, it’s not always clear what apps will run on which phones.

Moving from hardware, Apple’s cloud-storage service MobileMe has existed, in one form or another, for over ten years now and has never been a great success. Currently, the service offers cloud-based storage and syncing of some information, along with the invaluable location and remote kill switch for iPhones. All this for the not-so-low price of $100 a year.

MobileMe has faced additional pressure with the availability of many of its key services for free by other providers. Most of MobileMe’s functionality can be replicated with Google and Flickr for no cost. In particular, the release of free GPS phone tracking and kill switch for Android has greatly limited MobileMe’s value. But that may be soon be changing. Again, from the Times:

The new version of MobileMe is expected to be free and would allow users to synch their files without using a cable.

“The goal is that your photos and other media content will eventually just sync across all your Apple devices without people having to do anything,” the person said. If more iPhone users stored files online, Apple could make cheaper devices with less storage. Flash storage is one of the iPhone’s most expensive components.

The picture that emerges from the New York Times piece is a slimmer, cheaper phone aimed at new adopters and foreign markets relying on cloud-based services. The addition of a MobileMe-synced system could mean limited access to information, depending on how cloud-based the phone is, but greater consistency between computer and phone. It’s not a stretch to see this new iPhone further blurring the line between computer and mobile device.

Syncing media content also immediately brings to mind Apple’s acquisition of LaLa in December 2009, and the shimmering hope that someday iTunes music purchases will be available for streaming. Thus, one’s music could be available no matter what device one is using. That’s not so farfetched an idea with a more robust — and free — MobileMe, especially when Apple’s massive North Carolina datacenter is apparently still inactive.

Interestingly, the New York Times chose to put this story on the front page of their website and their iPhone app as well. Apple tech rumors have generally been the bread and butter of dedicated websites and the Wall Street Journal, while the NYTimes has been far more gun-shy about such speculation. It’s pure guesswork on my part, but seeing this story in a prominent position suggests to me that NYTimes feels confident about their information and their source.

Of course, the only certainty with Apple rumors is that there is no certainty. Only time, and a “just one more thing” will tell.

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