Apple iPhone price drop likely -

Jobs' Mob is so convinced that its expensive netbook without a keypad will cannibalise its glorious iPhone that it is preparing to drop the price of the mobile phone.

According to analysts Morgan Stanley Apple will drop the price of the iPhone when the Ipad appears in the shops in late March.

Analyst Katy Huberty said that Apple faces competition from a number of companies, including Google and Microsoft. It has also been policing its App Store more fervently, cutting Apps with controversial content.

She expects Apple to launch a new generation of smartphones in June “that offer both a lower total cost of ownership and new functionality, potentially including gesture-based technology.”

What she seems to be suggesting is that the iPad will eat into the iPhone's application market. Those who want to buy the iPhone because of the applications will buy the bigger screen iPad instead. Meanwhile with the likes of Google, Microsoft and Rim competing more aggressively in the mobile area, Apple's iPhone cash cow could be under stress.

Of course this all depends on the premise that the iPad will actually sell and that people will be stupid enough to pay for an ebook reader which does not have epaper, a portable game's machine that does not have decent graphics, a web device that does not have a keyboard for twice the price of a netbook that does the same thing.