Apple is set to launch its iPhone 7 later this year, and the handset is set to be another major success for the world’s largest consumer electronics company. But for the first time in many years, the position of Apple is not assured heading into an iPhone release, and this begs the question of what the California-based company will charge for its flagship smartphone when it is indeed released.
Apple stock plummets
One can describe Apple as the world’s largest consumer electronics company, as it is no longer possible to describe it as the world’s most valuable corporation; at least not for the time being. Google surpassed the market value of Apple recently, with the iPhone manufacturer having declined significantly in value over recent months.
The share price of Apple has diminished significantly in the wake of mediocre sales figures, and this problem may be far from over for Apple. Indeed, the company has already confirmed that it expects to sell less iPhone units in 2016 than it did in 2015; the first time that the consumer electronics giant has experienced a slump in sales since the iPhone was released back into 2007.
So the iPhone 7 is not being released into an ideal context for the Cupertino-based company, even by its own admission. But Apple does have a tendency to underestimate its own sales potential, and this could mean that the corporation manages to increase iPhone sales once again when the iPhone 7 is ultimately released.
In order to do this, the iPhone 7 is already being linked with some outstanding features, as Apple attempts to distinguish it from the other major smartphone devices on the market. It would seem that Apple needs to significantly upgrade the functions that were included in the iPhone 6S went the iPhone 7 is released, with consumers generally expecting it to be a next generation mobile.
iPhone 7 – Complete redesign
Thus, we can anticipate a complete redesign of the iPhone module when the smartphone is released, while Apple is expected to significantly upgrade many of the specs from the iPhone 6S. In particular, it is thought that the resolution included in the last generation smartphone will be improved for the iPhone 7, with Apple possibly set to release its first ever full HD smartphone and quad HD phablet.
The iPhone 7 has also been linked with a wide variety of camera technology, and some of this certainly sounds significantly more expensive than the existing unit. Initially, it was suggested that the iPhone 7 could include a professional standard DSLR snapper, and although this particular rumor has died down considerably, Apple is nonetheless expected to revolutionize the camera technology in the iPhone 7. A dual-lens unit has been particularly linked with the iPhone 7, and this would seemingly enable the corporation to deliver a unit capable of improved low-light conditions shooting.
So there are arguments for and against Apple stabilizing the price from the iPhone 6S when the iPhone 7 launches. But perhaps the stock issue could particularly motivate the corporation to deliver an affordable iPhone 7 when the device is unveiled in September.
Many analysts believe that Apple shares are extremely cheap at present, with the corporation also boasting in the region of $150 billion in net cash on its books. Yes despite the fact that the company could very well be considered to be undervalued, the fate of Apple shares over the next 18 months will still likely be determined by whether or not the iPhone can be returned to growth in the 2017 fiscal year.
In order to achieve this, it may be that Apple decides to freeze the price of the iPhone 7 from the smartphone that was released last year, with pressure on smartphone manufacturers coming from a diversification in the marketplace. Although Apple remains the dominant smartphone producer by a significant difference, more affordable Android alternatives are ensuring that the consumer electronics behemoth must consider its market position more assiduously.
Although Apple has tried to demonstrate to investors and the city that it is broadening its product range, the fact remains that the iPhone is incredibly important to the economic position of the company. The iPhone is still responsible for around two-thirds of overall Apple sales, and this profoundly underlines the significance of the smartphone to the economic future of the company.
Considering these factors, it is quite likely that Apple will stabilize the price of the iPhone 7, particularly as it increased the pricing of its flagship smartphone last year. This would mean that the bargain basement version of the iPhone 7 would start at $199 on-contract, with the off-contract version being $649. And the iPhone 7 Plus would likely be $100 more expensive for both versions, as in the last iPhone generation.
Production costs could motivate Apple to increase the price of the iPhone 7, but at the time of writing it seems that sales must be the critical motivating factor.