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Apple Unveils Smaller iPhone SE, Starting At $399 (techcrunch.com)
An anonymous reader writes: Apple has officially unveiled a smaller, cheaper iPhone designed to make a splash in the budget-friendly smartphone market. The new device, called the iPhone SE, looks nearly identical to the iPhone 5S but with a new rose gold color configuration. It's the internal specifications that differ significantly. The new iPhone SE will feature a NFC chip for Apple Pay, A9 processor and M9 motion co-processor, 12-megapixel camera sensor with the ability to capture 4K video, and a Touch ID fingerprint sensor. Unfortunately, it does not feature Apple's new 3D touch functionality. The iPhone SE will come in two models, 16GB and 64GB, priced at $399 and $499 respectively. You can buy the new iPhone starting March 31, and it will make its way to 100 countries by May.
$399 for a current-spec iPhone (without subsidy) is a very aggressive price point. Looks like the low-priced second and third tier Android phones are having an impact on Apple's unit sales.
If they started out at 64 GB then they wouldn't get as many people to pay the $100 upgrade for the next tier. That's how Apple makes their money. Make the base model just unappealing enough that people want to spend the extra $100.
At the volumes they do, we're probably talking about at least a $2 billion yearly revenue loss for them if they made the base model more appealing and fewer people upgrade to the next tier.
They know exactly what they're doing.
Yes, they've always targeted the premium market ... and that's why they're starting to lose.
Mostly because they dominate the hell out of the premium market - probably to the point of saturation. If you've saturated the high end with your product, and want to see more growth, guess where you gotta go?
The pricing they have was only reasonable when they were the only worthwhile smartphone on the market. This is no longer the case.
Depends. I have and use an unlocked LG phone that I bought last year... now the thing is starting to bork-up on the home key, and screen misalignment is starting to become an issue. Sure, I got the $200 I spent back out of it, but meanwhile my wife's ancient iPhone 4 is *still* chugging along just fine, years after it first showed up. My next phone? *shrug* Not sure yet, but damn I'm leaning towards something that would hold up better over time...
Therein lies the whole reason why most folks buy Apple stuff in the first place: It costs more up-front, but you make up the savings over time.
Quo usque tandem abutere, Nimbus, patientia nostra?