Phil Schiller Says Apple Won’t Sacrifice Quality For Market Share With Cheaper iPhone

Apple’s chief of marketing is in China with CEO Tim Cook where they are looking for some strategic partnerships with device manufactures. The Shanghai Evening News has published an interview [Google translation] with Schiller in which he addresses recent rumors of a cheaper iPhone.

TheNextWeb got a better translation of the interview and also got some confirmations about the same from Apple. So, here is what happened.

Interviewer Huang Yinlong spoke to Schiller about Apple’s products in China who said that “every product that Apple creates, we consider using only the best technology available. This includes the production pipeline, the Retina display, the unibody design, to provide the best product to the market.”

“At first, non-smartphones were popular in the Chinese market, now cheap smartphones are more popular and non-smartphones are out,” Schiller added later. “Despite the popularity of cheap smartphones, this will never be the future of Apple’s products. In fact, although Apple’s market share of smartphones is just about 20%, we own the 75% of the profit.”

Obviously, these statements appear to run counter to two rumors, one published in the Wall Street Journal and one in Bloomberg. The Bloomberg report stated that “Apple plans to sell a smaller, cheaper version of the iPhone as soon as this year, said a person familiar with the plans, part of a push to gain customers in developing nations.”

Well, the way Schiller has put it, it definitely does not deny that Apple may not look to work on a lower-cost iPhone but they’ll definitely not compromise on quality and make it cheap. The philosophy should not be a surprise to anyone familiar with Apple, but it does provide reassurance that Apple will fill a very specific niche if it does pursue a lower-cost iPhone, opting to pursue its own course rather than being letting competitors define where it will play in the market.

A lower-cost iPhone will actually help Apple drive sales in those countries where there is no carrier subsidy, like India, so that user’s do not have to pay a huge cost upfront.