How Apple’s $399 iPhone may give it an edge
Apple’s new iPhone SE is the lowest-priced iPhone ever.
That cheaper price tag is no accident.
“This is a symbolic threshold,” says Frank Gillette, an analyst with Forrester Research. “Apple going below $400 is big.”
The SE is predicted to do well in India and China, where having a lower-priced iPhone could give Apple an edge it didn’t have before.
The new device, announced Monday, is basically an iPhone 6S in a smaller, 4-inch body, and is a 38% discount to the current 4.7inch iPhone 6S, which starts at $650.
Jefferson Wang, an analyst with research firm IBB Consulting, says that overseas competi-
tors like Huawei and Lenovo regularly undercut Apple’s prices, even at the $400 level.
The new iPhone gets Apple “back in the game with price-conscious shoppers that don’t mind paying a little more for the Apple brand, even if it means sacrificing on screen size.”
Indeed, folks looking for the best bargain-priced phones here will find plenty models with lower prices and better specs than the new iPhone SE.
For instance:
Motorola’s Moto X Pure Edition ($399) has a 5.7-inch screen, 21-megapixel camera and microSD slot for extra memory.
Google’s Nexus 5X ($349) has a 5.2-inch screen, 12.3-megapixel camera and 64-bit Snapdragon processor.
Huawei GX8 ($299) has a 5.5-inch screen, 13-megapixel camera and 64-bit processor.
Alcatel’s Idol 3 ($249) sports a 5.5-inch screen, 13-megapixel camera and stereo speakers.
The SE starts at $399 with a 4inch screen, 16 GB of memory, a 12-megapixel camera and A9 processing chip.
The previous edition, the iPhone 5S, started at $450, with an A7 processing chip and 8megapixel camera.
Still, despite the specs, the iPhone is still the best-selling phone in the United States and the device many customers hunger for.
“Some people stretch, and justify spending more, because they want the status of having an Apple product and the Apple ex- perience,” Forrester’s Gillette notes.
Apple is virtually alone in offering the smaller, 4-inch phone models to consumers; the competition has been making larger, 5-inch-and-up phones for years.
This was originally a way for competitors to differentiate from the iPhone, says Gillette.
Apple held onto the 4-inch iPhone until 2014 when it intro- duced the iPhone 6. It didn’t abandon the smaller-form factor because many of its users liked having the option of small (the old iPhone 5S), medium (4.7-inch iPhone 6S) and large (5.5-inch iPhone 6S Plus).
If the SE takes off, “you might see competitors returning to small screens,” says Gillette.
But a word of caution to consumers looking to upgrade to a smaller iPhone at the lower price: with just 16 GB of memory, the SE doesn’t have enough memory “to make it worth it,” notes Gillette.
Add a few apps, take a bunch of photos using Apple’s Live Photos (a merging of stills and video that makes the file twice as large) and shoot some video at 4K resolution, which again produces larger video files, and you’ll be out of room in no time.
Add in the extra memory on the SE, for 64 GB, and the price jumps to $499.
That’s getting close to the more expensive, bigger phones. The older iPhone 6, first released in 2015, is $649 with 64 GB, and the newer 64GB iPhone 6S is $749.