When Android’s future depends on Apple’s decision of launching a low-cost iPhone

This is something that is objective and can be proven: iPhones draw more interest than high-end Android phones, especially now that there are tons of iPhone X clones, making Android flagships look dull in comparison to Apple’s creation.

Some rumors claim the Apple’s goal is to launch a “low-cost high-end range,” which is something that may impact the sales of Android flagships and flip the current market. Today we will analyze a possible scenario where Apple launches a relatively affordable iPhone and the consequences this may have on the Android market.

A look back: sales of low-cost iPhones

This is not the first time Apple has launched a low-cost iPhone. In September 2013, Apple launched the iPhone 5C, one of the worst phones in the company’s history. This phone featured the same processor as the iPhone 5, an Apple A6 at 1.3 GHz (whereas the iPhone 5S featured a 64-bit A7 processor, which was a turning point for the company), a plastic finish and 8 GB of internal storage. The price of the phone was $599, which was quite high and almost the same as its big sibling, $699.

Tim Cook himself recognizes the iPhone 5C was a mistake, as sales were not as good as expected. The units sold represented 1/3 of the amount of iPhone 5S sold (10 million vs. 30 million). However, Apple did not give up and released a phone at a lower price than usual, using a well-known method.

Although Apple failed to launch a low-cost alternative with the iPhone 5C, the company learned from its mistakes and three years later it launched the iPhone 5S Special Edition rocking the iPhone 6S’ hardware.

The iPhone SE came out as the iPhone 5S and iPhone 6’s child, and it was a hit. A good method with a new hardware and a €489 price, virtually a gift for a phone that featured the same camera of the 6S and 6S Plus. From that point onward, Apple knew exactly how to differentiate its premium models from the normalones, giving the Plus models a dual-camera setup and a large battery while the “standard” models were smaller, simpler and more affordable. With the arrival of the iPhone X, its siblings stopped being the stars due to the incredible change in terms of the form factor, which changed the phone industry: now everybody wants the iPhone X’s design.

The problem is that not everybody is willing to pay over 1,000 dollars or euros for that form factor. This is something Android manufacturers have taken advantage of to create exact copies of the iPhone X, like the Xiaomi Mi 8 and the Motorola P30, at a lower price. But what would happen if Apple itself sells the same form factor at a lower price? There is so much to tell.

The users’ interest for the iPhone

Although Android has a larger market share due to how affordable phones with said OS are, the iPhone is still seen as a symbol of luxury and excellence. According to IBTimes, the iPhone was even the new substitute for clothing, as the phone you have is more important than the clothes you wear. Studies show that teenagers prefer iPhones over Samsung phones, that there is a large preference for iPhones over Android phones in America, and that iPhones are a symbol of social status. Everybody has their own opinion, but studies prove this, and Apple surely knows how to create a feeling of luxury that no other manufacturer has been able to achieve.

Apple has always known how to create a feeling of luxury and status despite of the price of its phones.

The guys at Topes de Gama talked to other people in other media outlets about why Apple users think the price of the devices is justified. We found out that the difference between price and value is widely talked about. For some of these people, Apple products are not expensive if we take into account the value they provide the user (warranty, ecosystem, apps, device integration, finish…). When we talk about Android phones, these concepts do not usually come to mind. There are tons of high-end Android phones, but the public in general do not associate them with a luxury product or think they provide social status regardless of their price.

Having said this, it is only logical to think that the lower the price of an iPhone is, the more attention it will draw. As for the iPhone X, it is the most expensive phone in Apple’s history. It was the best-selling phone in Europe in the first quarter of 2018. The excellent sales numbers prove that despite the phone’s high price, users are willing to pay for it.

A low-cost iPhone X

We have heard rumors, but it is virtually confirmed Apple will launch a phone similar to the iPhone X for $699 by forgoing the AMOLED panel and the dual-camera setup in order to keep the price low. This phone will be the lowest-end one, standing below the iPhone X’s successor and its Plus variant, both featuring AMOLED panels and dual-camera setups.

$699 for an iPhone with the iPhone X’s design will certainly be a success. We still do not know if these phones will rock the iPhone X’s A11 Bionic chip or if they will feature the A12, but it does not matter! Apple’s A11 chip is still topping benchmarks, besting processors like the Snapdragon 845, the most powerful processor an Android phone can have.

We would spend less money for a high-end iPhone that costs less than 90% of high-end Android phones (the remaining 10% goes for OnePlus and Xiaomi phones). Predicting the scenario is quite easy. There will be a high demand for the low-cost phone, like it happened with the iPhone SE, and the more expensive models will sell well due to their dual-camera setup.

Users who choose Android because they cannot afford an iPhone

We are not talking about you, or maybe we are, but the reality is that thousands of users have an Android phone simply because they cannot afford an iPhone. Before somebody starts saying anybody can sign a contract to pay €30-40 for a couple of years for an iPhone, this is not true. People always forget about the overall price. A typical iPhone sale (with no specific cuts or discounts) can end up being €50-60 per month, which is something not everybody can afford for a phone.

To prove it, if we search for iOS or iPhone on Google Play, we will find dozens of apps, some of them have even been downloaded thousands of times. Said apps are used to give you an iPhone experience on your Android via software. This should tell us something.

Final thoughts

The low-cost iPhone is a threat for Android sales. It is too early to jump into conclusions about products that have not even been launched yet, but is it not hard to analyze the possible scenarios in case this turns out to be true. High-end Android phones need to stand out, not copy the iPhone. Even if it took the lead a while ago, it seems that Apple is innovating in several aspects, setting a trend that has been around for a year already.

As usual, only time will tell if this low-cost iPhone will threaten OEMs in terms of the high-end range.

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