Apple to Launch New iPhone to Compete With New Palm Pre

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The new Palm Pre is set to hit the streets, via the Sprint network, tomorrow.  Sprint is hoping this will be their new flagship smartphone.  AT&T and Verizon are hot on Sprint’s heels, waiting for the relatively short exclusivity contract with Palm to end so they can get in on the Pre action too.

Although Verizon Wireless’ CEO made claims last week that it would be putting the Pre on its network in about six months, the CEO of Sprint, Dan Hesse, says that’s inaccurate.  While he wouldn’t give a tim period, he says the exclusivity contract Sprint has with Palm is longer than six months.  You can see video of his press conference at CNet News.

Apple, meanwhile, has seen the potential threat and is planning to introduce a cheaper, lower-powered version of the iPhone.  That might happen as early as Monday and is rumored to be the new iPhone Movie, which would likely go into production this summer.  The new phone could be as much as $100 cheaper than Apple’s current low end phone .

AT&T still retains their exclusive deal with Apple as the iPhone’s only carrier.  Financial Times reporter Joseph Menn thinks the new iPhone will debut at Monday’s developer conference with a keynote by Apple’s marketing chief Phil Schiller.

Meanwhile, the Italian iPhone blog ispazio has published leaked photos of the new iPhone (seen left).

Both Apple and Palm are probably going to see each other more and more as rivals.  Currently, the iPhone holds about 11% of the world’s smart phone market and Palm barely registers, having lost their primacy long ago.

Sprint, for their part, is offering an extremely low-cost value plan for the Pre, including the $100/month “Simply Everything” plan.  No word on how much connectivity is included with that, but it’s a plan aimed specifically at smart phones like the new Pre.

This could get interesting.


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