TECH
11/26/2014 04:13 pm ET Updated Nov 26, 2014

Cheap iPhone Supposedly Getting The Ax From Apple

Phil Schiller, Apple's marketing chief, stood on stage at the company's headquarters in California last year and introduced the iPhone 5C, the "cheap," colorful plastic iPhone. "Everyone's really excited about this," he said.

Actually, they weren't.

Starting at $99 on contract and $549 off contract in the U.S., the 5C was supposed to be Apple's "budget" phone. It was meant to appeal to people in emerging markets like China and India.

But it turned out people all over the world were much more excited about the pricier iPhone 5S, which outsold the 5C in some places by margins as high as 5 to 1 in the days after the launch, and 2 to 1 in the U.S. in the months after.

Now, a new rumor says the 5C may be going the way of the dodo.

MacRumors, citing a report in Taiwan's Industrial and Commercial Times, reports that Apple may discontinue production of the iPhone 5C in the middle of next year.

This is only a rumor. And it's unclear, of course, if Apple will stop selling the phone at that time or at any point before it announces a new phone. Apple did not return a request for comment Wednesday.

If the company does stop selling the 5C halfway through next year, it would be a departure from its typical strategy -- Apple tends to stop selling the entry-level iPhone when a new phone is announced in the fall, not in the middle of the year. But Apple seems like it's already scaling back the 5C -- it didn't update the phone in the fall, and the only version of the 5C available on Apple's website is the 8-gigabyte model. In the U.S., it's free with a two-year contract or $450 without.

None of this is actually bad for Apple. The iPhone 6 and 6 Plus, Apple's flagship phones that came out in September, are breaking sales records. Neil Cybart, an Apple analyst who blogs at Above Avalon, estimates that the company will break another record this quarter and sell a whopping 68 million iPhones, a 33.3 percent increase over the same period last year.

With the iPhone 6 Plus, Apple did the opposite of what it did last year -- it actually raised the price of the iPhone. The 6 Plus starts at $299 on contract ($749 off contract) for a 16-gigabyte model. But many people have opted for the 64-gigabyte version of the phone, paying $399 ($849 off contract).

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