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Apple’s Newest iPhone, Set to Be Unveiled Tuesday, Could Cost $1,000

If the iPhone X costs $1000, that works out to $42 a month over two years. Even Apple understands the appeal of lower-cost devices with its iPhone SE for $399. “Apple has cultivated a class of buyers who pay more and expect to pay more for a type of brand prestige,” Steve Wozniak, Apple’s cofounder, told CNNMoney. Apple and the rest of the smartphone industry have done an impressive job removing the sticker shock by moving to a monthly payment model. But is anyone going to pay such a high price for an iPhone? People spend more than 4 hours a day on their phones, according to comScore. “Your greatest return on investment for any piece of technology is your phone,” Munster said. If you buy the 256 GB iPhone 7 Plus, that’ll cost you $969. Related: Will $1,000 iPhone = $1 trillion value for Apple? So some folks are already willing to pay $1,000 for their iPhones. The next iPhone is rumored to cost about $1,000. That means $17 a month more than what many are already paying. “Without an aspirational product, it assumes there’s no value in a phone beyond its utility,” Dediu said. Apple has offered a less-expensive and a mid-range iPhone, but it hasn’t yet come out with a bells-and-whistles, aspirational iPhone for its biggest fans. Fast forward to today: The average selling price of an iPhone is $605 — and no one blinks an eye. You bet. The average iPhone sold last quarter cost just $25 a month over two years. (Credit: Sean Gallup/Getty Images)
The iPhone X (or whatever the new iPhone will be called) is expected to come with all the bells and whistles: an edge-to-edge screen, face recognition and a 3D camera. “I’m sure that I’ll want at least one of the new iPhone, but maybe not five of them, like in the past,” Wozniak said. Although some may want the latest and greatest, Apple fans weren’t always willing to shell out so much for a new iPhone. A decade ago, consumers feigned shock and horror when the company said the first iPhone would cost $599. That makes them far more valuable than any other gadget — including laptops, which easily sell for over $1,000. Apple eventually cut the price by $200 and offered credits to customers who already bought one. Xiaomi, OnePlus and Motorola have raced to offer competively-priced devices that maintain surprisingly high quality. Apple employees prepare Apple iPhone 7 phones on the first day of sales of the new phone at the Berlin Apple store on September 16, 2016 in Berlin, Germany. 37.090240
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Apple Expected to Announce Major iPhone Redesign on Tuesday Apple analyst Gene Munster, now with Loup Ventures, believes between 30% and 40% of Apple’s customers would be willing to pay the $1,000 or more to buy the new iPhone. “Even techies want to show off that they have the very latest iPhone.”
The iPhone X may be the first iPhone in three years to look substantially different from the iPhone 6. Consumer goods makers typically offer low-end, mid-range and high-end products, and customers typically find themselves buying in the middle. It is expected to be announced at an Apple event on Tuesday. “But some people want to buy expensive things to feel good about themselves, because they want to give expensive gifts or feel powerful or influential.”
How does Apple’s biggest fan feel about the $1,000 price? But Horace Dediu, an Apple analyst with Asymco, believes offering a super high-end iPhone is the right move for Apple, because it follows a classic retail strategy. You’ll probably be able to get an iPhone 6S for as little as $449, starting Tuesday. “People have become more comfortable spending lots of money on their phones.”
Related: Apple’s big iPhone reveal is coming
The counterargument is that there are really great phones on the market now for less than $400.