Rumors of Apple turning MobileMe into a cloud service aren’t exactly new. In fact, we’ve been hearing about them ever since Apple acquired Lala sometime last year. Now, the WSJ is reporting that Apple is ready to turn on their cloud service and with it introduce a stripped down iPhone that contains less memory and a smaller form factor.
While we have a hard time believing that Apple would reduce the footprint of the iPhone, a slimmer version is most certainly within reason seeing as the iPod Touch already reflects that sought after sveltness. The person who saw the new iPhone says that it’s “significantly lighter than the iPhone 4 and had an edge-to-edge screen that could be manipulated by touch, as well as a virtual keyboard and voice-based navigation.” Touch! Voice navigation! No way! Kidding, that already exists.
Now, in terms of reducing the memory capacity of the iPhone. Sure, it would result in a cheaper device, but we hardly think it would cut the wholesale cost of the device in half as WSJ has theorized. Memory tends to have the largest margins when it comes to this kind of hardware, so it stands to reason that Apple would lose more money on the iPhone if they did this, though it would allow carriers to offer the device next to nothing and thus catapulting the iPhone into millions of more users hands. So perhaps a number of other components would have to be scaled back, such as the processor’s power and screen quality to reasonably achieve this.
But, if Apple does reduce the memory capacity of the iPhone, then it’s logical that they’d have to launch a cloud service, otherwise users won’t have enough space to store their music, photos and videos. Nonetheless, though, there would have to be enough space for gaming and other apps, so a decent memory capacity can’t be negated all together.
Also, it’s unlikely that Apple would offer their cloud service for free, seeing as their profits would be cut from selling a cheaper iPhone with less margin friendly memory, right? So they could institute a monthly service charge, which seems like a good way of making up lost margins, and guarantees another source of revenue for the already cash flush company. But this all begs the question of an all you can eat subscription model to the iTunes store. Perhaps different tiers depending on your level of access. $10 a month for music, $15 a month for music and tv shows and so forth. But, we digress.
The “source” says that the new iPhone and cloud service will hit as soon as June of this year. However, we’re not buying any of it. Apple will continue to sell the iPhone 4, release the iPhone 5 this summer and probably offer an advanced MobileMe service for the same price of $10 a month.