Apple iPhone 5 Price and 4G LTE Factor: Would Consumers Pay?

We seem to have been writing about the Apple iPhone 5 since the launch of the iPhone 4 last year and one of the aspects we’ve looked at is the price of the next iPhone. Back in January we asked readers how much they would pay for the iPhone 5 and more recently in June we then asked if the pricing could even come down despite improved specs being widely anticipated. Now we are wondering about iPhone 5 price with regards to the 4G LTE factor and whether that would increase the cost to consumers.

There has been widespread speculation about the iPhone 5, which is now thought to be due for release in the fall and recently we showed a useful iPhone 5 infographic detailing many of the rumored specs and features and noting the odds of them actually happening for the next iPhone. One of the inclusions on the infographic was 4G LTE support and this was given a 50% chance of making it to the iPhone 5. Of course nobody really knows for sure whether it will appear and when asked about the importance of 4G LTE for the iPhone 5 consumers were pretty mixed with their response, although more people wanted to see its inclusion than not.

More recently we also spoke about LTE and other features thought to be required to beat the current influx of impressive Android handsets and just two weeks ago OSM’s Maddy Rowe told how the hacking group LulzSec claimed that the next iPhone and also iPad will be LTE-enabled. An article over on Digital Trends by Jeffrey Van Camp has now caught our eye as it talks about the expense of bringing 4G LTE to the iPhone 5 and whether the upcoming smartphone will indeed have it. Van Camp notes that the HTC Thunderbolt may be the most expensive phone on the current market as far as cost of build goes, thanks to its 4G LTE chipset. This added around $50 to the price of the smartphone to consumers.

The question is, if Apple provides us with a 4G LTE iPhone 5 will it bear the brunt of the extra cost itself or pass that cost onto consumers? Senior analyst for IHM, Wayne Lam, while acknowledging that Apple has not confirmed 4G LTE support for the iPhone 5 said, “If it does, two things are clear. First, the iPhone’s minuscule printed circuit board (PCB) will have to grow in size in order to support the first-generation LTE baseband processor as well as all the supporting chipset. Second, the next iPhone’s BOM value certainly will increase substantially compared to the iPhone 4 if LTE is implemented in the same manner as in the HTC ThunderBolt.” Previously in April, Apple COO Peter Oppenheimer declared that the company wasn’t ready for LTE handsets yet but of course Apple is known for its secrecy and could have been throwing us off the scent. Alternatively the company may have realized how important LTE is now and reversed its decision.

It seems a big ask to suggest that if LTE capability comes to the iPhone 5, that Apple carries the cost itself but at the same time there’s been a lot of talk about Apple wanting to keep its prices competitive so it might not want to add too much to the price for consumers. We’ve also heard rumors of a cheaper iPhone, the iPhone 4S (possibly a 16GB storage version), so is there a chance that the iPhone 5 may then be a 4G LTE version with a higher price level? That way Apple would be attempting to keep everybody happy by providing a lower-priced option while also giving the expected specs to a higher-priced model, although of course there will always be some purchasers who want higher specs at the same price.

We’d like to hear your thoughts on this quandary. Would you be prepared to pay more for a 4G LTE iPhone 5 or would you prefer pricing to stay around the same and go without 4G LTE? Let us know with your comments.

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