Why Apple’s releasing an ‘iPhone 5se’ instead of a 4-inch iPhone 7

“Holdouts awaiting a modern 4-inch iPhone have a lot to look forward to with the expected iPhone 5se next month,” Zac Hall writes for 9to5Mac. “A mix of iPhone 6 and iPhone 6s technology in a one-hand friendly, iPhone 5-sized case.”

“While 4-inch iPhone fans will likely be plenty happy with the iPhone 5se next month and the mid-cycle release is an interesting new strategy, a 4-inch iPhone 7 released in the fall alongside the expected 4.7-inch and 5.5-inch upgrades with comparable specs would simplify the buying decision for me,” Hall writes. “Here’s why I don’t think that will happen anytime soon.”

“It’s all about average selling price, and Apple has found itself cornered,” Hall writes. “For years now, iPhones have sold with similar pricing structures. Without factoring in contract subsidies and financing plans, $649 gets you the base model flagship iPhone, spend $100 more to increase your storage or another $100 to increase it further… A truly new 4-inch version of the iPhone 7 would need to cost less than $649, like be priced at $549, and have the side effect of lowing the entry level price for a brand new flagship iPhone. Maybe Apple could pull it off as a private company, but Wall Street would surely have a fit if Apple intentionally lowered the iPhone’s average selling price.”

Read more in the full article here.

MacDailyNews Take: The amount of meh engendered here by the idea of this “iPhone 5se” is limitless. Hey, Tim, if this is really what it’s going to be, why not just call it the “iPhone Performa” and be done with it?

SEE ALSO:
iPhone 5se may come in Silver, Space Gray, and Bright Pink – February 5, 2016
Apple aims to unveil iPhone 5se, iPad Air 3 and Apple Watch updates at March 15 event – February 2, 2016
Why Apple’s ‘iPhone 5se’ would be a desperate move – January 28, 2016
Apple likely to debut iPad Air 3, iPhone 5se, iOS 9.3, watchOS 2.2 with new Maps app, new Apple Watch bands at March event – January 27, 2016
Why Apple’s rumored 4-inch iPhone 5se may well be worth seriously considering – January 25, 2016
‘iPhone 5se’ likely to have faster A9/M9 chips and always-on Siri – January 25, 2016
Apple ‘iPhone 5se’ compared to an iPhone 5 in leaked image – January 25, 2016

23 Comments

    1. Condescension aside, Apple does need a product for emerging markets/post-communist societies. $549 is still high, but it’s a start, maybe they can get this model’s price down to $499 or less in a year when the next one is released. The base 6s costs $800 in Eastern Europe, it’s as if Apple doesn’t want customers here.

      You don’t need to make crap, but for most people the choice is obvious between a $200-400 Samsung or Huawei and the aforementioned 6s when they are making $1000/month or less. Even the old 5s costs $440, that’s not competitive.

      At this point I think Apple can give Wall Street the double middle finger as far as ASP. Get the iPhones in the hands of tens of millions more people, get them hooked into the ecosystem and reap the rewards for years to come.

      1. Not going to happen. Devaluing the brand would be without precedent for them. Apple became the most valuable company in the world, with highest profits not by making products for every person, but by making the best, most highly coveted, and most expensive product in their market segment. The value of Apple as a brand was built on the perceived value of the hardware it sells. Half of the PC market sells for well below $500. There are no new Macs that can be bought for that little money (except for the Mini). Same for the iPhone.

        I don’t expect (nor do I want, as a shareholder) to see a latest-model iPhone starting below $500.

    2. Fine, then sell last year’s technology there.

      Give first world nation users what they have been asking for for years — current models in multiple sizes. Anything less is just another slap in the face. Is Apple even listening???

    3. For the love of Jobs! This is not about the effing price! It is about the functionality factor. I will be happy to pay $650 or +$100 premium for the smaller device (because obviously it is more challenging to cram the same level of functionality into a smaller phone). There is no reason why 4″ phone cannot start at $650. Anal-ysts are throwing a fit here about the price points and emerging markets but it is just BS as usual.

    1. As the article explained rather clearly; the cheapest new iPhone was always $650. Seven years ago, that was iPhone 3GS; four years ago, it was iPhone 5; last fall, it was 6S. Next year, it will presumably be iPhone 7.

      When Apple introduced iPhone 5, it increased the screen size for the cheapest latest-release device. Two years later, with iPhone 6, it increased it again. No current model was ever offered with the smaller size than the previous year. That means that if Apple were to offer a smaller-size iPhone 7, then it would be effectively reducing the screen size for the latest model (or increasing the price for the same screen size as last year). Neither of these two would sit well with the users. And dropping the price below $650 for the current model is never going to happen.

      Unfortunately, for all those who are looking for a smaller-screen device, you are very unlikely to ever get a current-model device (i.e. with current specs and features). Reduced-size iPhone cannot cost $650, so Apple will have to sell it for $550. There is no way they will sell current specs and features for $100 less than they did for the past eight years.

    1. MDN has stopped claiming that quite some time ago. Even they (he?) realised that there are legitimate, real people, with real and legitimate reasons to want a smaller iPhone.

      And they likely will never again get a latest-model specs and features in a smaller package. Too bad…

  1. Apple’s ability to maintain current price levels is dependent on added functionality. There comes a time when the added features are insufficient to provide a compelling reason to upgrade, or to buy iPhone instead of Android.

    We’re not there yet: Apple continues to innovate and people continue to upgrade or move from android to iPhone. Yet, already, many iPhone users ignore a large part of the functionality of their device. ApplePay, for instance, is really not that useful: I still carry a wallet and will have to do so for the foreseeable future. Paying at the supermarket is possible with my iPhone, but easier with my chip credit card so my iPhone stays in my pocket. I’m not sure I want 3D Touch – I hate it on my Mac trackpad because it activates when I don’t want it – and I don’t find any of the extra features useful. I haven’t figured out how to turn it off yet.

    Objectively, we are getting closer to Android/iPhone parity. Android is “good enough” for a lot of people. If that number grows significantly the iPhone premium pricing model will lose its lustre.

    1. I’ve been using Applepay for months now. I can’t picture a scenario in which using a credit card is more convenient, or even nearly as convenient, as paying with the phone. To begin with, the card requires two hands (opening the wallet, pulling the card out). Second, usually, most people have their wallet in a secure place (inside pocket, purse, etc. ). Phone is usually much more accessible. And lastly, the wait for the pun lasts seemingly forever (which is, in all fairness, some 10 seconds), and when paying by phone, the system apparently gets the authorization within two seconds. I know the difference in convenience isn’t huge and not enough to motivate some people to use Applepay, but it certainly exists and is decidedly in favor of Applepay.

  2. Apple can’t have high and low end models of all sizes. That would be too many different models. It makes sense to make the smaller screens also the lower-end models. It’s similar with cars. Compact cars generally get lower-end everything else.

    Sucks for people who want a high-end, small-screen phone, but you cain’t always get what you want. It’s life.

  3. MDN spot on this makes me shiver at the thought of the return of the confused bad old days. On this one I totally agree SJ would never have allowed this. Apple should dictate the market not try to get the best of both worlds by confusion and obscuration in the market place with obscure naming conventions. That’s Dells job.

    1. YES, yes, YES, yes YES!

      And by the way, this goes for offering iPad 2, 3, retina, mini 1, mini 2, I DONT KNOW WHICH IS FOR SALE RIGHT NOW….DIDNT THIS GET PASSED ON IN STEVE JOBS APPLE UNIVERSITY?!

  4. Seems to me that with the newer more efficient and smaller internal components (cpu, video, backlight, wifi, bluetooth, etc) they could increase the battery life by hours if they use the 5S housing. Perhaps something like 20 hours talk time, 18 hour internet, standby of 45 days.

    All in a phone that you can operate with one hand that even fits into your pocket. We all don’t need 7.5, 9.3, or even 15 inch iPhones. A four inch phone is perfect.

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