Apple’s Cheaper iPhone Is Key To Elusive Chinese Market: Piecyk

Tuesday’s highly anticipated Apple (AAPL) event has been the subject of media speculation since invitations told members of the press that the tech company would “brighten everyone’s day.”

The cryptic message lead many to believe that Apple will be unveiling a new line of colorful iPhones.
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Some speculate that the new phones will not just be colorful; they’ll also be cheap. “The low-end phone is key because it opens up a new market,” says Walter Piecyk, wireless analyst at BTIG. “70% of the world’s population uses prepaid service, they get no subsidy and they can’t afford a $600 phone.”

The cheaper phone could appeal to untapped companies in emerging markets like China Mobile. Adding fuel to the speculative fire, Apple is also inviting Chinese journalists to an event in Beijing on Wednesday. Various reports say that top executives from Apple and China Mobile began meeting in July.
Also on the table for today’s event, the high-end iPhone 5S. The phone is said to have fingerprint security capabilities and a brighter and faster operating system.
An Apple TV upgrade might be in the works, but don’t expect any big reveal on that front, says Piecyk.
“The phone business is always going to be the most important thing for Apple going forward. Whether it’s a TV or a watch, these are just add-on products to the central product for Apple which is the phone.”
Apple’s announcement will come hot of the heels of Samsung’s new Galaxy Gear smartwatch.

Both the Samsung Smartwatch and Google Glass have led some to question whether Apple is falling behind when it comes to innovation.

Apple stock is down by nearly 25% year over year.