Although Apple’s iPhone 5c is supposed to benefit the company, many believe that the discount phone will do more harm than good.

In the weeks prior the release, rumours that the “C” stood for “cheap” spread like wildfire. Apple, however, announced that the cheapest version of the iPhone 5c will cost $599.00. Consequently, the iPhone 5c could end up in limbo. It is not cheap enough to compete with lower end phones and does not have the same product quality as higher end phones.

Furthermore, introduction of the iPhone 5c could shift Apple away from its luxury brand status. In the past, Apple took pride in the luxury products that they offered and charged a premium for them. The introduction of a discount iPhone could tarnish the reputation that Apple spent so many years building up. Selling a discount product will take away from the exclusiveness and prestige of a luxury brand, which is a reason why Lamborghini and Maserati don’t have lower end cars.

In short, despite concerns, I believe that Apple will sell millions of the discount iPhones. While this may be beneficial in the short-run, Apple may not be so lucky in the long-run.

References:

http://www.prdaily.com/Main/Articles/Does_Apples_cheaper_iPhone_hurt_its_brand_15201.aspx

http://www.reuters.com/article/2013/09/10/us-apple-iphone-idUSBRE98908I20130910

http://www.androidcentral.com/apple-s-iphone-5c-announcement-won-t-change-anything