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Last summer, a goon did some bad reporting and ended up creating a stir about misinterpreted data.  I think it is safer to look at the market and say, “how would/should Apple react?” It is time to roll the iPhone Nano concept back into the light of day.  Here is why I think it makes sense now:

Reason One

We know that the average cell phone sells for $200.  Apple’s current offering is double that and the 3G version (let’s call it iPhone Pro) is expected to be more.  Moving the 3G Pro upmarket to say $499 opens up room for a lower end version.  And we all know the volume is higher the lower you go.

Reason Two

When Jobs the 3G iPhone Pro version at any price, he’ll need to assure the audience that their won’t be a price drop like there was with the first incarnation.  One way to do that is to also introduce a lower priced model, giving us the power to see Apple won’t price 2 phones the same.

If this holidays early sales telltales are anywhere close to reliable, Apple is proving the touch is holding its own as a stand alone product, despite being the same price as the iPhone (at 16GB).  This says cannibalizing isn’t as big a worry as they once may have thought.  Following this logic an iPhone Jr. or iPhone Nano coming in at $250 or $299 might make some sense.

Reason Three

Apple could get lots of mileage out of a phone with a logical and user friendly OS.  No one has been able to duplicate the fun experience (Voyager? C’mon) of flicking around the screen.  This lead won’t last forever and Apple should exploit its uniqueness and fad flavor while it still has it.  Strike while the iPhone is hot.

A down-market iPhone would need to be smaller (for a less than premium experience) and perhaps some feature stripping. Good bye WiFi? Apple can go for 3G out of the gate with the cheaper model and reduce the need to claim it still runs fast. It would need text and IMing in my opinion to not get ridiculed.

Reason Four

Oh, and an AT&T sales rep let slip an iPhone Nano is coming and it is much smaller.  Put your trust in the market and what a public company has to do; not rumors.  Like this one.

Read [Wired]