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The iPhone 5C Is A Luxury Phone After All

Many of those listening to rumors leading up to Tuesday’s media event in Cupertino believed “low-cost” iPhone meant “low price” iPhone, which just simply isn’t true with the iPhone 5C.

Yes, the rumors about the 5C were right in every single regard, including those rumors most people didn’t want to believe — namely, that the budget iPhone would not be so “budget-friendly” after all. In July, a Korean website first reported Apple’s intentions to remove the iPhone 5 from its iPhone lineup entirely, which meant the iPhone 4S (the last remaining iPhone in the classic 3.5-inch screen design) would likely remain at its $0 on-contract price, while the iPhone 5C filled the $99 void between the 4S and the newest high-end phone, the $199 iPhone 5S.

Sure, $99 on-contract for a new iPhone isn’t a bad deal in the U.S., but as my colleague Sophie Song points out, the same iPhone sells for the equivalent of $735 in China, which is pretty nutrageous considering how so many analysts believed the purpose of this budget iPhone was to bridge the gap between luxury consumers and the mainstream, especially in countries where iPhones aren’t so easily subsidized by carriers.

This would initially make the 5C seem like a great-plan-turned-PR-disaster for Apple, especially in the relatively fragile Tim Cook era, but the iPhone 5C strategy is actually quite brilliant. Here’s why:

1. If the iPhone 5 still existed, it would cost the same as the current iPhone 5C; if anything, the 5C performs either equally well or better than its predecessor. The FaceTime camera has been beefed up a bit, its surface has become more scratch-proof and more comfortable to hold (so I’m told), and owning an iPhone 5C in one of five bright colors definitely makes it feel more fun and personal. The color strategy has worked for Apple in the past (see: iMac, iPod), and the iPhone is Apple’s most popular product. You do the math.

2. The  5C is more forward-thinking than the 5S. Apple knows — probably better than anyone — how quickly technology can become old. Even with the iPhone 5C and 5S officially out the door, the clock is ticking on the next iPhone. And if there’s a new iPhone, you can always count on last year’s iPhone getting a price drop. If we’re lucky, we could see this year’s 5C model — a perfectly good phone in its own right, considering its many similarities and improvements to the bestselling iPhone 5 — sell for $0 on-contract by this time next year. And in the technology world, “next year” isn’t very far away. In a year, the five colors of the iPhone 5C could still be the best smartphone deal on the market (looking at you, Moto X).

3. The iPhone 5C stays close to Apple tradition. If you were expecting a truly cheap iPhone this year, well then you don’t know Apple, jack. Apple will continually take pride in itself as a luxury brand, and nothing less. There is nothing “cheap” about this iPhone — the plastic has an extremely high-quality feel and finish, and there’s no point in calling its starting price a bargain. Therefore, owning this particular phone will still be considered relatively exclusive and special in many countries. And if the iPhone wasn’t distinctive before, its five new colors certainly ensure that from now on.

So, as it turns out, the rumored “budget iPhone” turns out to be a luxury item after all. I like the green one.

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