We’re probably still more than five months away from the iPhone 11 and possibly iPhone 9 release, but people are already trying to figure out how much they’re going to cost. Of course, the iPhone 11 price and iPhone 9 price both depend heavily on what their specs end up looking like, but analysts are using the many rumors that have been circulating to take a stab at pricing.
Here’s what most expect from the iPhone 11 and iPhone 9
Tech watchers are generally assigning a few names to the next iPhone line-up, so for the sake of this article, I’m going to refer to the iPhone X’s successor as the iPhone 11 and the iPhone 8’s successor as the iPhone 9. Analysts generally expect three new iPhone models this year.
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RBC analyst Amit Daryanani listed his expectations for the iPhone 9 and iPhone 11 in a note earlier this week. He’s expecting a 6.1-inch LCD model, which presumably would be the iPhone 9, and two models with OLED displays, which we’ll refer to as the iPhone 11 and iPhone 11 Plus. He expects the iPhone 9 to feature a full-screen display with 3D sensing capabilities, and he believes that, based on his channel checks, these iPhone 9 features should drive sell-through—if the iPhone 9 price is “reasonable.” He believes the iPhone 9 will end up being about half of the units that are sold in the next cycle.
His supplier checks suggest a production target of 80 million to 90 million iPhones this year, which is a decline from the 100 million to 120 million units that were originally estimated for the iPhone 8/X cycle. Based on supplier feedback, he also believes Apple has tightened up iPhone costs, which he expects to partially offset a potential decline in average selling price for the iPhone 11 and iPhone 9.
Estimating the iPhone 11 price and iPhone 9 price
UBS analyst Steven Milunovich set out to estimate the iPhone 11 price and iPhone 9 price in his own note this week. Like Daryanani, he expects the LCD-equipped iPhone 9 to sport a 6.1-inch display with Face ID sensor. He expects the iPhone 11 to have a 5.8-inch OLED display and the iPhone 11 Plus to have a 6.4-inch OLED screen.
He also offered two potential scenarios for the iPhone 9 and iPhone 11 price plans. One puts the iPhone 11 price at $999, the iPhone 11 Plus price at $1,099, and the iPhone 9 price at $750. In this scenario, the average selling price for the iPhone 9 would be flat or up of more than 70% of buyers choose the newest models and 35% of the mix ends up being the iPhone 11 or 11 Plus.
On the other hand, he also said that Apple might try to price its next flagship handsets more aggressively. He said that could mean that the iPhone 11 price will end up being $900, while the iPhone 11 Plus price will be $1,050 and the iPhone 9 price end up at $700.
Many analysts have said they think the price tag on the iPhone X is what kept many consumers from buying it, so it’s possible that Apple will try to price more aggressively for the next cycle, even though the company isn’t exactly known for offering devices at lower prices. We also heard recently that the iPhone 11 may cost $40 less to produce than the iPhone X did, which would give Apple room to cut the price—or keep that benefit for itself, enjoying a higher margin on it without passing the savings on to consumers.
How elasticity in the iPhone 11 price will impact volumes
Milunovich also addressed the issue of price elasticity, which really became an issue with the first $1,000 model, the iPhone X. He expects the percentage of consumers who will pay $700 or more for an iPhone in fiscal 2017 to rise from 40% previously to more than 70% in fiscal 2018, but he ponders what this will mean for iPhone volumes.
He does feel that Apple’s strategy has managed to convince “price-inelastic consumers” to pay more while also providing “suitable alternatives for price-conscious consumers.” Price plays a major role in the unit mix, with higher prices usually meaning lower volumes, but he doesn’t believe iPhone volumes have really been hit by this issue yet.