Will Apple Have to Lower iPhone Prices Soon?


When Deutsche Telekom's T-Mobile agreed to carry the iPhone, it did so in a unique and particularly troubling way: without offering a subsidy.

To be fair, Apple shares have taken a beating recently for any number of reasons. Analyst downgrades. Reports of tepid iPhone 5 demand in China. The company's failure to pay a special dividend. By comparison, the T-Mobile deal shouldn't mean much.

Yet investors seem to fear that AT&T , Sprint Nextel , and Verizon will follow T-Mobile in abandoning subsidies, leading to steep cuts in iPhone prices, lower margins, and (gulp) declining profits.

Are price cuts in the works? What about lower profits? Fool contributor Tim Beyers answers these questions and more in the following video.

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The article Will Apple Have to Lower iPhone Prices Soon? originally appeared on Fool.com.

Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team and the Motley Fool Supernova Odyssey I mission. He owned shares of Apple at the time of publication. Check out Tim's Web home and portfolio holdings, or connect with him on Google+, Tumblr, or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.The Motley Fool owns shares of Apple. Motley Fool newsletter services have recommended buying shares of and creating a bull call spread position in Apple. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.The Motley Fool has a disclosure policy.

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Originally published