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Apple's Going Cheap, Says Report

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Two months ago, Deutsche Bank analyst Chris Whitmore made the bold prediction that Apple, in addition to a brand-spankin' new iPhone 5, will target the international pre-paid cell market with a cheaper, mid-range iPhone.

"With Nokia and RIMM struggling, the time is right for Apple to aggressively penetrate the mid-range smartphone market," Whitmore said.  "It's time for a mid-range iPhone."

Well, according to a new report by Reuters, a mid-range iPhone might be on its way.

Speaking with two sources familiar with the matter, Reuters says an unnamed Korean manufacturer has already begun making the components for a cheaper, 8GB iPhone 4. The discounted model is supposedly launching alongside the iPhone 5.

Echoing Whitmore, Yuanta Securities analyst Bonnie Chang said that a cheaper iPhone could be a huge boon to emerging markets.

"Apple may want to push into the emerging market segment where customers want to switch to low- to mid-end smartphones from high-end feature phones, which usually cost $150-200," Chang told Reuters. Adding, "But I think for an 8GB iPhone 4 the price is hard to go below $200, so Apple will still need a completely new phone with low specifications for the emerging markets."

As for the iPhone 5, Reuters' insiders claim that Apple is still shooting for late-September launch -- despite earlier reports that the new model has been pushed to October. According to one source, "The new iPhone, which some call the iPhone 4S because of its largely identical appearance to the existing iPhone 4, will have a bigger touch screen, better antenna and an 8-megapixel camera."

But, as always, Apple has no problem with keeping us guessing.

(See also: BlackBerry Ad Accidentally Features, Promotes Android and Why Apple Fans Lash Out)

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POSITION:  No positions in stocks mentioned.