The price of the 10th anniversary iPhone has been widely rumored to hit four figures at retail due to high-end features like the OLED display and 3D sensors. However, one analyst believes Apple’s iPhone 8 will cost slightly higher than the iPhone 7s and Samsung Galaxy S8 Plus but less than $1000.
Steven Milunovich of UBS estimates that this year’s iPhone will only have a $70- to $90-increase in construction over its predecessor, the iPhone 7 Plus (presumably the 32GB variant). That should come in at a sticker price between $850 and $900 for consumers. He believes that a $1000 price tag would hamper purchase volumes, noting that despite the mostly fallacious notion of an Apple Tax, the tech giant sells its devices “quite competitively” in markets it enters.
“We think an $870 price would be accretive to EPS but dilutive to gross margin, a dynamic Apple has said it would accept,” UBS stated in its note, per CNBC. Accordingly, a 256GB model will be available between $950 and $1,000. For comparison, the 256GB iPhone 7 Plus retails for $970 while Samsung’s flagships Galaxy S8 and S8 Plus is sold for $720 and $840, respectively.
‘Display Size Disadvantage’
Aside from the fact that the Cupertino-based company rarely offers its products significantly higher than its closest rival, the iPhone 2017 is also expected to sport a much smaller display, contrary to rumors that it’ll come with the same screen size as the Galaxy S8.
“Apple’s top model will be at a display size disadvantage to Samsung’s Galaxy S8 Plus. We still think Apple will choose to price its top model relative to Samsung’s top model but remain cautious on how much higher Apple could ultimately go on price given a smaller display,” Milunovich wrote. The OLED iPhone will likely have a 5.2-inch display, compared to the 5.8-inch screen of Samsung Galaxy S8 and 6.2-inch of the S8 Plus.
On the other hand, Apple will likely pack the handset with a variety of things that will set it apart from the Korean company’s flagship, including a 3D camera and a fingerprint sensor embedded into the display. This should help the iPhone maker explain away a marginal price difference, without getting the device to retail at $1,000.
Other features for the next iPhone include wireless charging, USB-C, and AR support. But, but those are yet to be confirmed.
Meanwhile, UBS also believes a decrease in price for the iPhone 7s and iPhone 7s Plus by around $100 per model. This is said to give a wider range of prices without any significant jumps from the newly refreshed iPhone SE to the iPhone 8. Milunovich claims this would give the tech giant a better toe-hold in China which has poor demand for the former model.
Apple iPhone 2017 Production
As a result of this pricing, the analyst predicts that 45 percent of the 2018 shipments will be the new iPhone. This parallels market analyst TrendForce’s earlier forecast that iPhone 8 numbers this year will amount to more than 40 percent of the total sales figures.
Unfortunately, the company remains tight-lipped about iPhone 7’s successor to date. However, rumors are rife that it’ll commence mass production with Taiwan Semiconductor Manufacturing Company this month.
While Apple seems way ahead of its schedule, there are still talks that it will release the iPhone 8 in limited quantities this September. The official release of the phone is said to come much later in the year. Apart from iPhone 8, another analyst claims there are two more iPhones coming this year. According to Ming-Chi Kuo of KGI Securities, these will be the update of the current iteration, the iPhone 7S and 7S Plus.
What are your expectations for the next iPhone? Would you prefer a smaller screen size and cheaper cost or a bigger display but higher price? Sound off your thoughts in the comment section below!