iPhone 6c: What Is Apple Thinking?

• Apple Inc. AAPL is planning a special event for March 2016.
• The event will likely include the unveiling of the new Apple Watch, but could also involve the launch of an iPhone 6c model.
• With the limited success of the 5c, analyst, suppliers and shareholders question the strategy of another low-cost iPhone model.

Apple is reportedly planning a special event for March 2016 at which it intends to unveil the second generation Apple Watch. However, another possible reveal at this upcoming event could be the rumored iPhone 6c device.

About the 6c
Though its existence has not been confirmed by the company, the 6c is rumored to have the same 4-inch display size used in the iPhone 5s model. This would be welcome news for iPhone users who preferred the smaller screen to the 4.7-inch iPhone 6s and the 5.5-inch iPhone 6s Plus.

In terms of specs, the 6c is rumored to be an intermediate between the iPhone 5s and the iPhone 6s, containing both earlier-model camera features and the new iPhone A9 chip.

5c disappointment
Some Apple supporters are questioning the decision for Apple to pursue another low-cost model after the iPhone 5c was relatively poorly-received. Apple released the lower-margin iPhone on September 10, 2013, and had three million units of inventory remaining by the end of the year.

Suppliers not convinced
According to a CLSA analyst who recently met with Apple suppliers in Asia, suppliers are among the onlookers that are confused by Apple’s strategy. "What was interesting to me is that EVERY single company I met with in Asia last week was asking ME about the strategy of AAPL releasing a lower priced model," the analyst wrote, noting that, ironically, these were the very same answers CLSA was after.

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In addition to adding to customer and supplier confusion, the 6c would certainly complicate logistics and likely weigh on Apple’s margins as well.

The analyst concluded by reiterating that nobody in Asia could 100 percent confirm a 6c rollout as of now, but March 2016 is rapidly approaching.

Disclosure: the author holds no position in the stocks mentioned.