Why iPhone and Android Phone Prices Will Get Even Higher (cnet.com)

Critics scoffed Apple when the company priced the iPhone X at $1,000. But the way the market has responded to it, there is a good chance that the upcoming flagship smartphones from Apple and those of its rivals -- Samsung, Google, and HTC -- will be pricier. From a column: The critics were wrong. Apple CEO Tim Cook said in July that the iPhone X had outsold every other Apple device in each week since it went on sale Nov. 3, 2017. With strong iPhone X sales, Apple proved that mainstream buyers are willing to pay almost as much, if not more, for their cell phones as they would for a powerful laptop. And with rumors of an even pricier 2018 iPhone X Plus-style phone coming down the pike this September, Apple's moves to usher in the era of the $1,000 phone may just be getting underway. Apple isn't alone in boosting mobile phone prices ever higher. Creeping prices on high-end handsets from Samsung, Huawei and even "value" darling OnePlus signal that price hikes are here to stay. In just two years, the cost of Samsung's Galaxy phone for US buyers has spiked 15.1 percent from the Galaxy S7 in 2016 to this year's Galaxy S9, while the Huawei P series has climbed 33 percent since 2016 -- and that doesn't even account for the existence of a "Pro" model. [...] The trend of increasingly costly handsets in the top tier underscores the cell phone's importance as an everything-device for communication, work, photography and entertainment. And as processing power, camera technology, battery life and internet data speeds improve generation after generation, the value people attach to a phone is sure to swell.

Comments

People aren't seeing the actual price

[Nidi62]

Very few people are shelling out $1000 straight up for the phone. They all have $20-40 tacked on to their monthly plan payments to pay for the phone. This will also inflate the number of new phone purchases because, once their old phone is almost paid off in 2 years, there's a brand new phone that they can "buy" without paying any more than they already are. Take away payment plans and you won't just see the price of phones drop, you'll see the number of new phones purchased drop as well.

Re:People aren't seeing the actual price

[swillden]

Very few people are shelling out $1000 straight up for the phone.

True, but I don't think that's the core reason people are willing to pay so much.

I think the core reason is that what people are willing to pay is driven by the value they perceive, and that in turn is closely related to how much they use a thing, and what for. To an increasing percentage of the population, their phone is their sole computing device, and society is increasingly organized around connectivity and computation. To put it another way, look at what people use their phones for, and how many times per day they use them.

I'm something of a luddite (as are many slashdotters, I think), in that I prefer to do most of my online interaction on a physical keyboard, either my laptop or my big, multi-screen desktop with its funky ergonomic keyboard. But most people don't. So nearly all of their non-local (and sometimes local) interpersonal communications for work and play, news, entertainment, banking, information retrieval, etc., etc., etc,. is done on that one device. When you spend so much time using one object, it makes sense to spend whatever you can afford to get the best one you can.

I used to sit on $40 office chairs in my home office. Then one day I thought about the sheer quantity of time I spend with my butt planted in that chair and realized that I would get more value out of money spent on a better chair than many other things I could spend my money on. So I "blew" $600 on an Aeron-style (not actually Herman Miller, but similar, and with a high build quality) ergonomic chair and it has been money very well spent because it eliminated a lot of minor annoyances. Little stuff, like how the mesh seat and back allows airflow so I don't get sweaty, and how it has enough flexibility of positioning that I can always get comfortable. I not only don't regret the choice, when this one wears out (which it shows no sign of doing), $600 will be my price floor for a replacement and I'll be looking for what is available at higher price points.

I get my phones for free so I don't really have to make this decision. But if I did, I suspect I'd have no trouble dropping $1K on a phone that I replace every other year. I'm sure I use it 100 times per day, 365 days per year. A tenth of a penny per use? Makes sense to me.

Re:Why SOME phone prices will go higher

[Oswald McWeany]

A thousand dollar phone better last six or seven years (even if you have to drop it off at a service center every couple years to have the battery replaced).

Meanwhile, you're right on that money that phones from the likes of OnePlus continue to pump out features and performance at a price tag fully half that of the major flagships.

The kind of person willing to spend $1000 for a top-tier phone is not the kind of person who would be willing to keep the same phone for 7 years. Especially since, two years after it is released there will be $250 phones that are more powerful.

Re:Why SOME phone prices will go higher

[Anubis IV]

Exactly this.

I can't help but feel as if this news is missing the obvious explosion of growth in the value proposition being offered by the low-to-mid portion of the Android market. Whereas in years prior a phone that cost 1/4 that of a flagship phone might provide most people with an equivalent value (i.e. it's about 1/4 as capable as the flagship phone), these days you can get a phone that costs 1/4, yet provides most people with 90% of the value of the flagship. If you're an Android user, there's really no reason to go for the flagship phone unless you're set on getting that last 10%, but for most people, that's well past the point of diminishing returns.

I'm an iPhone user and am almost certainly going to upgrade from my 2013 iPhone to whatever new flagship they launch later this year, but even I wouldn't advocate my choice as a general practice. In years past, it used to be easy advice to tell people to get max(favorite_brand) (with favorite_brand being swapped around depending on if someone was in the Android or Apple ecosystem), since the lesser models all made significant compromises. These days, however, most people are best served by double-checking on what that last 10% actually gets them and whether it's worth the additional cost.