Apple’s next iPhone, rumored to be known as the iPhone 8 or iPhone Edition, could be expensive. But it might not be as expensive as originally thought.
In a recent note to investors, UBS analyst Steven Milunovich said that he and his fellow analyst Benjamin Wilson “question the logic” of reports suggesting Apple will offer a $1,200 iPhone this year. Instead, the analysts said Apple could price the entry-level iPhone 8 at $900 and the higher-end option with more internal storage for keeping files at $1,000.
Apple’s (AAPL) next iPhones are expected to be unveiled at the company’s press event on September 12 at 1 p.m. ET/10 a.m. PT. The event, which will be the first hosted at the Steve Jobs Theater at its Apple Park headquarters, is expected to play host to three new iPhones. Two of those handsets—which could be known as the iPhone 7s and iPhone 7s Plus—are rumored to only offer minor upgrades over last year’s iPhone 7 and iPhone 7 Plus. A third model, which could come with the iPhone 8 or iPhone Edition branding, might offer a major upgrade.
According to the latest reports, the iPhone 8 could come with organic light-emitting diode (OLED) screen, which offers sharper visuals than the liquid-crystal displays (LCD) used in all previous iPhones. Additionally, the iPhone could have a revamped design, including a screen that nearly entirely covers its face. It should also offer a glass finish with a stainless steel band around its spine.
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All of those updates, as well as rumors of the iPhone 8 supporting wireless charging, have caused many industry pundits to suggest Apple’s handset could far exceed the $1,000 price mark. Some reports have even pegged Apple’s iPhone 8 pricing at as much as $1,400.
Such a high price tag would make the iPhone 8 substantially more expensive than its chief competitors, like the recently announced Galaxy Note 8 that costs around $950 depending on the carrier. But even with those technological advancements, Apple’s history might be its guide on pricing, the analysts argued.
They noted in their note to investors that “Apple rarely prices too far above competitors,” and provided a host of examples across smartphones, tablets, and the computer market, where that’s illustrated. They also explained how they believe Apple thinks about pricing.
“We don’t think Apple thinks ‘How much can we charge?'” the analysts wrote. “Rather it chooses a price band worth playing in and then develops a product to fill that space.
“If Apple cannot deliver an experience worthy of the brand at a given price band and profitability level,” the analysts continued, “it does not proceed.”
