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

Why SOME phone prices will go higher

[geschbacher79]

To me, the most interesting development in phones has been the incredibly value in the sub-$300 price, as evidenced by Motorola's various phones, Huawei, Honor, OnePlus, etc.

At the top end, perhaps prices will continue to climb but that certainly doesn't imply all prices will increase. The top tier phones will be luxury items for a certain segment of the market, but the overall trend in terms of phones being shipped has been the amount of value being delivered in the and mid and low price tiers, and that should be heart-warming for consumers. That $1000 phone might be better or the best, but it won't be $700 better than the Moto G6 or similar phone.

Re:Why SOME phone prices will go higher

[atrex]

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.

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.

Re: Why SOME phone prices will go higher

[houghi]

You talk about sub 300usd phones as ifthey are cheap. Few years ago that was expensive. Very expensive. The thing the 1000usd phone does is making 300usd look like a bargain.
It isn'r.

Re:Why SOME phone prices will go higher

[Streetlight]

The problem with keeping an Apple phone or some another brands is that OS software updates seem to result in performance degradation, i.e., the hardware can't keep up with new "features" or increased complexity in OS updates. Phones from Google only guarantee OS updates for two years and security patches for three years. The phone makers see a cash cow as users need to update on a two or three year schedule. Those who can afford these schedules will pay the price. Those who can't will make use of much lower priced replacements.

Re: Why SOME phone prices will go higher

[Kristoph]

You can buy an iPhone and replace it every year, selling your current version for $150-200 less then itâ(TM)s purchase price.

I spend more time with my phone then with any other electronic device I own so $150-200 a year seems like money well spent.

Re:Why SOME phone prices will go higher

[TomGreenhaw]

You are absolutely right, and they do the opposite. They engineer the phones to be fragile. Apple refuses to touch a phone with a third party installed battery and refuses to supply repair parts rendering many phones unrepairable.

Its a great business model if consumers will go along.

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:However

[DontBeAMoran]

Apple supports their phones and tablets for a lot more than 24 months.

As an example, iOS 12 will support the following:
iPhones
iPhone X
iPhone 8 Plus
iPhone 8
iPhone 7 Plus
iPhone 7
iPhone 6S
iPhone 6S Plus
iPhone 6
iPhone 6 Plus
iPhone SE
iPhone 5S (First released on 2013-09-20)

iPads
12.9-inch iPad Pro
10.5-inch iPad Pro
9.7-inch iPad Pro
iPad (fifth-gen)
iPad Air 2
iPad Air
iPad Mini 4
iPad Mini 3
iPad Mini 2 (First released on 2013-11-12)

Opposite take from actual user

[SuperKendall]

Apple can go ape themselves with faceid. It's a step back from touchid

Thank you for giving me the opportunity to educate others.

I find what you say to absolutely to be not the case, having had the iPhoneX since launch. How long have you owned or used a FaceID device? My guess is never.

In fact I was planning on buying a newer iPad, but held off my purchase until iPads include FaceID also, I like it so much more.

I find it VASTLY better than touchID. I like how it authenticates without thought, for many uses the device works just like the old days when people did not have passcodes, and of course FaceID is also much more secure than TouchID (by 20x or more).

Apple made the brilliant move ...

[Qbertino]

... of transitioning from a pure technology brand to a lifestyle and fashion brand with the advent of the iMac. They've been going further down that road ever since.

Today they are so far ahead that they can even drag their heels with us opinion leaders delivering meh hardware with last year's specs and still cap at 1 billion due to iPhones sold everywhere all the time.

That brand power of Apple these days is something it's would kill for.

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[account_deleted]

Comment removed based on user account deletion

You know how you get a cheap phone?

[kaatochacha]

Walk into your phone center and tell them "I'm looking for the cheapest phone you've got".
I had to do this back in the Midwest in a town that my family was visiting for funeral preparation. Only Verizon worked there, and none of us had Verizon.
The lady at the counter pulls out an new in box Samsung they just got in, "on discount, I don't know why" . $30 out the door, pay as you go.
Functions perfectly acceptable.
At that price point, I don't care if I drop it in a toilet.

Re:Peculiar choices

[Aqualung812]

I guess we now live in a world where quite a few people are willing to pay top dollar for second rate quality. Let's face it, even the best Bluetooth link doesn't provide the best sound. And it doesn't matter how you massage it, the sensor in a cell phone isn't going to match even a relatively cheap camera.

I can't think of a single thing a microwave oven cooks better than a real oven, skillet, or grill.

So why does nearly every home have a microwave oven? It is fast, and "good enough".

As a photographer, I was taught that the BEST camera is the one you have with you. I have a DSLR, but I don't carry it with me everywhere. My phone camera works far better for that.

When I'm listening to music on an airplane or a volleyball tournament, I'm not looking for reference audio. I'm looking for something that sounds better than the noise I'm hearing without headphones on. Not having to get my headphone cable snagged on something is a very nice plus, and my headphones have 40 hours of use on a charge.

  You're missing the point completely. It isn't about a single measure of quality.

Re:Who is buying these things?

[ranton]

Most people I know have decided that all the selling points of flagship devices aren't really that big of a deal and are buying cheap phones that can browse, take some crappy pictures, and do messaging.

My wife and I buy the nicest phone available every other year almost entirely for the camera. We like not having to carry a separate camera for photos of our kids, and it's worth an extra $50 per month for us both to have the best camera phone money can buy today, instead of what the top of the line was 2-3 years ago. There are plenty of other nice things about having the best phones available but the camera is the main selling point.