More iPhone price cuts could be on the horizon, with one investment firm predicting the recent cuts in Japan and China could be just the start.
Apple’s smartphones often hold their value for a while, with substantial discounts often occuring only after a few months. However, in this case a $100 discount in Japan surfaced barely a month after the iPhone XR launch, which was followed by a 20 percent discount on the iPhone XR and the iPhone 8 and 8 Plus in China announced this month.
Investment outfit Wedbush, predicting further price-cuts, has suggested that it’s not all down to the 2018 model iPhone models poor sales, but instead Apple trying to maintain a solid grip on the smartphone industry there in response to quality phones at cheaper prices from Xiaomi and Huawei surfacing.
Related: iPhone XS vs XR
Reported in 9to5Mac, Wedbush claim:
“[China is critical for Apple going forward and that’s] why we expect more significant price cuts on XR over the coming months. While some investors will fret around price cuts and what it means for top-line growth in the next few quarters and losing perception as a luxury smartphone, taking a step back it’s all about the installed base for Apple.”
“In our opinion Apple is facing a “code red” situation in China and the right pricing strategy around XR and future versions will be key to putting a ring fence around the core installed base in the region. With lower priced competition from all directions with Huawei and Xiaomi front and center, Apple needs to make sure that over the next few quarters they do not lose any current iPhone customers and thus speaks to the more significant price reductions on the way.”
Controversially, they also report that Apple might seek to rebrand itself as a services company rather than a hardware outfit. This could fit with Apple’s status as a lifestyle brand. Wedbush suggest that Apple will look to line up content acquisitions for a future streaming library, highlighting Lionsgate and Sony Pictures as potential acquisition targets.
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