It’s unlikely Apple will target the mid-range or affordable phone market anytime soon, despite strong interest in cheaper iPhones, according to industry experts.
Gartner research vice president Annette Zimmermann told Trusted Reviews that Apple’s focus on profit suggests it will continue to only offer modest discounts on its handsets, despite recent evidence suggesting lower prices could grow its overall market share on Wednesday.
“Yes, we could assume that because general microeconomic forces imply an increase in sales when the price is lowered. And given that Apple confirmed that [the] iPhone 11 (where the price was lowered slightly compared to iPhone XR) was the best selling model during the entire holiday quarter [the data] supports that assumption,” she said.
Zimmermann added that, if current industry rumblings are to believed, we could at best expect modest price drops on Apple’s 2020 iPhones.
“If we believe the rumours then Apple will launch 4 new models with 3 screen sizes this fall, two high-end and two slightly lower priced models. One of the lower end devices is said to have a smaller screen than the current iPhone 11 Pro,” she said.
“This could suggest that this device may have a slightly lower price or the same as the iPhone 11 generation. But it really depends on the specs included. A decrease in price would help with sales but hurt profitability. Apple is more interested in profits rather than market share.”
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Gartner revealed the iPhone 11’s lower than expected price let Apple overcome an overall drop in phone sales in Q4 2020 in its latest Global Smartphone Sales Report on Tuesday. The report revealed that Apple and Xiaomi were the only two phone makers to see growth during the end of last year, which saw an overall 0.4% dip in sales.
The report suggested the iPhone 11’s competitive pricing – by Apple standards – led to a 7.8% spurt in iOS phone sales during Q4 2020. This made Apple the second biggest phone seller during the period, sitting just below Samsung with a 17.1% stake of the market. Prior to that Apple had suffered three consecutive quarters of declining phone sales.
“A slight lowering of the prices of the iPhone 11 series, compared with the iPhone XR, and other price reductions for previous-generation iPhone models, increased demand. It also helped Apple regain the number two position,” explained Zimmermann.
Apple’s next generation iPhone 12 family of phones are expected to arrive at some point in September, though there are concerns they may be delayed, due to supply chain issues resulting from the coronavirus.