Introducing the budget iPhone this year is a crucial Apple move, likely creating an overall positive impact on the tech giant's global presence, notably in the emerging markets, a new report said.

At the same time, Android device manufacturer will be compelled to implement significant price cutbacks, and the result would be a flood of low-priced handsets.

With a tag price that is realistically affordable for the masses, Apple is looking for a possible market explosion over the long-term with the global entry of a cheaper iPhone model, writes Asymco analyst Horace Dediu.

Mr Dediu notes that all iPhone models lag behind their Android counterpart in the international markets where the Google platform presently counts some 800 million activated handsets.

By mid-year, the numbers will shoot up to one billion, more or less, highlighting the immense popularity enjoyed by Android smartphones, the analysts said. He added that Android is in wider use because handsets are available from entry-level to high-end models, which is not the case with iPhone.

Apple sells its smartphone in a fixed model - coming with prices that are unreachable for many buyers around the world. In the end, these consumers turn to the next best thing - Android phones.

However, the reported entry of a budget iPhone edition by Q3 2013 will disturb this pattern and change the tide of the global smartphone competition in favour of Apple, Mr Dediu said.

He pointed to the U.S. iPhone marketing model as an example. American buyers, the analysts explained, enjoy the Apple smartphone without paying too much.

"At a minimum price of $0 (with a contract) many consumers are finding the iPhone attractive relative to a $0 (with a contract) Android phone," the Asymco analyst wrote.

If the same 'price parity' is introduced by Apple to markets like China, India and other key countries "one wonders what would happen."

The likelihood is the iPhone maker will gain more inroads in these emerging markets.

And confronted with cheap Apple experience, Android device makers have no choice but to match or even attempt to beat the budget iPhone's attractive price point.

The result is a worldwide gadget environment where consumers are the end-winner - relishing the affordable iPhone and even more dirt-cheap Android smartphones.