According to analysts, Apple will not be significantly raising the price for its 2020 iPhones. Each new entry in the Cupertino-based company’s smartphone yearly lineup has been more expensive than the last. But the new report claims that it would not be the case for the upcoming 5G iPhones.
Generally speaking, smartphones that are equipped with 5G modems are more expensive than mainstream 4G variants. The best example of this being Redmi K30 that arrives in a 5G and, a more affordable, 4G variant. However, according to an analyst from TF International Securities, the cost of new iPhones will rise by just 30 to 100 US Dollars (roughly 211 to 703 CNY).
The reason for this is that the iPhone released in spring will share the cost of Apple’s September 2020 launch. The American tech giant is expected to release 5 smartphones in 2020, one of which will be released in spring before its four main lineups. Notably, support for 5G is one of the key upgrades of the new iPhones for the second half of the year.
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Regardless of the more expensive 5G components being offered, Apple will not be increasing pricing significantly. The company aims to achieve this by not paying NRE (non-recurring engineering) for one-time metal frame/ case manufacturers in 2020 which saves development costs for the company. In simpler terms, it can help the company manage revenue and expenditure during off-seasons and peak seasons.
Previously, Apple had to compensate its suppliers for their losses suffered due to differences between off-season and peak season shipments. Now, by launching another device in the spring it can balance the revenue between both seasons and not have to pay the fees that it provided its suppliers such as Foxconn. This will allow Apple to not significantly hike the prices of 2020 iPhones with 5G connectivity.
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(Via)
