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Apple to look to software to differentiate multiple iPhone models

Execs talk about 'segmentation by software'

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Exclusive Apple is considering launching multiple iPhone models each differentiated by software, rather than hardware capabilities, company executives have hinted.

Yair Reiner, an analyst at Oppenheimer, recently met with several unnamed Apple executives who, he claimed, said: “[The] iPhone is still in its early days and could gain share by: providing more functionality, lowering prices, growing geographically, or segmenting the market with different models.”

Reiner told Register Hardware today that – when he pressed the firm for further details – the staffers said: “Segmentation would focus on software.”

Apple’s executives were understandably tight-lipped about the details of such segmentation, but it's not hard to imagine the creation of a series of iPhones each running the same core iPhone OS but bundled with different apps and utilities.

For example, Apple could market one 'YouTube' iPhone model with applications that provide video capture, editing and sharing features. Other iPhones might only offer basic video capture - or perhaps no video at all.

Selling models differentiated by hardware seems unlikely. Different iPhones with very different physical specs could have far-reaching implications for Apple’s production methods, volumes and costs.

However, the same core hardware to which a series of different software bundles could be attached would allow Apple to combine the cost/volume benefits of producing as few models as possible with the ability to push different configurations at different kinds of customer.

Whether Apple decides to go down this a route remains to be seen, but rumours have been circulating for weeks that it’s at least prepping some form of update in the interim. For example, a leaked iPhone screen shot from China recently hinted at a 32GB model with faster CPU. ®

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