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Technology Rumor of the Day: Apple

"Sequels that copy the original look of the first-generation model too slavishly, tend to have short life spans in the phone business," says Global Crown Research analyst Tero Kuittinen. As the Razr showed, "this cookie cutter strategy ended up backfiring spectacularly," he added.

Granted, unlike the Razr, Apple's iPhone is more than hardware. Users rave about it as a great media player and a decent mobile Web device. And the enormously popular iPhone App store, which lets users download software to run features like Facebook and weather widgets, gives Apple a competitive edge.

But is that enough to keep the halo glowing?

Apple does have one option if it needs to reinvigorate iPhone's sales: Cut the price to $99.

Sounds good, but don't hold your breath. Apple doesn't lower prices on new, improved models. Last year, for the rollout of the 3G iPhone, the price was cut from $400 to $200 when Apple agreed to have telco partner AT&T cover a bigger portion of the cost to buyers. In exchange, AT&T locked iPhone customers into higher-rate two-year contracts.

Apple is far too cunning, or proud, to repeat Motorola's pricing disaster. Toward the end, Razrs were given away two or three at a time as bait for new contracts.

The takeaway: Winning streaks are glorious, but they never last.
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