Apple's Low-Cost iPhone to be an 'iCloud' iPhone

AppleNApps claims that Apple plans to release a new low-cost iPhone in the coming months. Such low-cost model of iPhone will contain significantly reduced onboard storage and instead rely primarily on streaming content from the company's new iCloud service. That is why some experts call that device as the "iCloud iPhone". But such service would put significant strain on wireless carriers charged with moving data down from the cloud every time it is needed.

We have three independent sources contributing to this report who are all connected to Apple in different capacities. The main takeaway is that Apple intends to launch two iPhone models in the fall with a full upgraded iPhone 5 as expected, as well as a cheaper iPhone which will be the iCloud iPhone.

The iPhone 5 will reportedly appear in a thinner form factor carrying the A5 chip. The iCloud iPhone will have almost the same components currently used in the iPhone 4.

One of our contacts is familiar with the design of the iPhone 4, and says that Apple is cutting the cost of making an iPhone 4 without sacrificing any of its qualities. The main cost cutting will come from Apple reducing on board storage, using a smoother yet cheaper aluminum back and siding, and already having a majority of the supplies on hand. The result will be a cloud based iPhone experience that is unique in the market that will be accessible to a large percentage of users because of the price point.