Apple’s iPhones may have hit peak price tag, and may be set to trend down.
A new research note from reliable Apple analyst Ming-Chi Kuo suggests that the 2022 iPhones—the ones that come after the iPhone 12 successor that will show up later this year—may cost significantly less than their predecessors.
Kuo says the top-of-the-line 2022 model, which will have a 6.7-inch screen and may be called the iPhone 14 Pro Max, will be $200 less than the current top-of-the-line model, the iPhone 12 Pro Max, which starts at $1,099 with 128 GB of storage.
Apple has affixed that starting price to its top-of-the-line phone for the past three years. The 2018 iPhone XS Max started at $1,099, as did 2019’s iPhone 11 Pro Max and 2020’s iPhone 12 Pro Max. Whether this year’s iPhone 13 Pro Max (or whatever Apple names it) begins a trend down toward Kuo’s sub-$900 price prediction for the 2022 top model will be interesting to see.
Kuo also says Apple will continue to offer a pair of lower-priced iPhones in 2022, one a 6.1-inch model and the other a 6.7-inch model. The analyst doesn’t predict the price of the low-cost models, but the prices of the lower-end phones tend to move with those of the high-end phones, so those models could hit new lows, too.
A downward trend in iPhone prices shouldn’t be too surprising. It could be a way for Apple to navigate a global smartphone market that’s saturated and growing more slowly than it was a decade ago. iPhone sales peaked at 230 million units in 2015 and declined steadily until the company said it would stop reporting unit sales in late 2018.
Most important, it may be a way for the company to further accelerate the growth of the part of its business that has been picking up the slack from slowing iPhone sales: services. Making iPhones more affordable means increasing the already large pool of iPhone owners. More than a billion iOS devices exist out in the wild—each one set up to act as a little vending machine for Apple services, such as Music, Apple TV, iCloud, and Apple Arcade.
The services business is rapidly becoming Apple’s center of gravity. The company reported that its services business had grown 26% from the March quarter in 2020 to the March quarter in 2021. In fact, the services business has seen double-digit growth every quarter since 2015.
Kuo’s report has some other interesting nuggets. He believes that the 2022 phones will add some significant improvements:
- An optical Touch ID button below the screen so that people can have two options for unlocking the phone. Some reports have said that Apple has been working on the idea of bringing the fingerprint reader back to the iPhone for a long time, but it’s possible that the pandemic (in which Face ID couldn’t recognize masked users) may have soured Apple on relying solely on facial-recognition tech to unlock the phone.
- A much higher-resolution wide-angle camera at 48 megapixels (versus the current 12MP camera on the iPhone 12), but only for the top-of-the-line Pro models.
- Kuo said in an earlier investor brief that he believes the top-of-the-line 2022 iPhone will be the first ever capable of 8K video recording.
- A small “pinhole” on the front screen to accommodate the front-facing camera (replacing “the notch” at the top of current iPhones).
As for the 2021 iPhones that will be announced later this year, most Apple prognosticators believe the upgrades will be confined to component improvements. The phones will get bigger batteries, possibly an “always on” 120Hz display, and possibly a new back surface texture that’s easier to grip, according to a rumor roundup by 9to5Mac. The phones will likely use the same “flat sides” design used in the iPhone 12.
Kuo seems to confirm that Apple is sticking to its habit of implementing major changes to its phones every other year. 2021 is probably not one of those years. So if you’ve never been fond of “the notch,” and having an alternative way of unlocking your phone is important to you, you might consider holding off on upgrading until 2022.