Apple Producing Lower-Cost 8GB iPhone: Report

Technology giant Apple

has begun production of a cheaper 8GB version of its wildly popular iPhone, two people familiar with the matter told Reuters Tuesday. The move would likely be aimed at growing Apple's global market penetration by targeting lower-end users who don't want to pay $200 or more for a smartphone. Notoriously secretive, Apple takes extreme measures to protect its proprietary information and pipeline products. The phone is only speculative at this point, but it wouldn't be a surprise to see the company aim for a broader market segment. According to the Reuters report, "The flash drive for the 8GB iPhone 4 is being manufactured by a Korean company, one of the people said Tuesday, declining to name the company." The sources didn't want to be identified because the information has not been made public. The rumors come in addition to expectations of a new version of the company's standard iPhone. It's expected that the phone will sport a larger screen, better connectivity, and a bigger camera. Apple has been enormously successful in its iPhone sales, beating analyst expectations even in the most recent quarter. It sold more than 20.3 million iPhones in the second period, versus estimates of 17 million to 18 million. Industry watchers expect Apple to announce a new update of several of its products in late September.