Analysts Gokul Hariharan and Mark Moskowitz believe that the low cost iPhone will in fact be a mid ranged iPhone and will not compete with the real cheap smartphones. The analysts point to Apple's previous introductions of the iPod nano and iPad mini as cheaper versions of their parent products that were still significantly more expensive than low-end competitors due to Apple's refusal to sacrifice quality for the sake of price.
The cheaper iPhone is expected to be prices at about $400 compared to the iPhone 5 at $650. This would mean the cheaper iPhone will cost about R5000.
At the moment this market segment is ruled by Samsung with 35% market share. Apple will be eager to gain a piece of this pie.