Apple Cuts iPhone Price by $200

Apple said Wednesday it is scrapping the 4GB iPhone in favor of a single 8GB model, while dropping the price substantially. The surprise announcement came after news of new iPod models, including the iPod Touch. The iPhone will now cost $399 USD.

At that price, the iPhone will only cost $100 more than the 8GB iPod Touch and the same as the 16GB iPod Touch. Although Apple could see a sales boost from those who felt the iPhone was too expensive at $499 and $599, the price cut may have the unfortunate effect of upsetting current customers, who paid $200 more just two months ago or less.

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