iPhone 5: How bigger screens could lead to best in class profit margins for Apple
iPhone 6 is already the topic of rumors and speculation. Over the weekend Bloomberg reported on the possibility of Apple moving to larger display sizes next year. Rene Ritchie has been writing about just that here on iMore for a while now as well. Now, some of us may remember Apple bashing large screens in the past. Part of that was technology. Competitors were using OLED and PenTile subpixels to get to larger sizes, and Apple argued color saturation on those displays wasn’t good enough. Tim Cook has always been clear on the idea that they don’t want to sacrifice on quality to deliver size, whether this quality sacrifice come from color reproduction, power consumption, durability, or something else. Another part of that was one-handed ease of use, which Apple in the past equated to hardware narrowness, but which everything from BlackBerry 10 to iOS 7's gesture navigation have shown can also be handled by software. If there is one thing that’s certain (other than death and taxes), it's that technology keeps improving. Whatever compromises Apple felt users would face with a larger iPhone screen will eventually be bypassed. And when that happens, it is only logical to assume larger iPhones will follow.
And heck ... if the screens for 2014 will be good enough, why not marry them with some additional improvements such as pressure sensitivity or curved glass too? And if Apple can do all of this while pushing the screen close to the edges of the device then it might just bring us the best possible mix of screen size vs. device size, while maintaining that sense of industry-leading industrial design. It's what they just did with the iPad Air, after all.
Personally, I’d love to see pressure sensitive screens from Apple. It would add a whole new variable for user input. I’d love to use a “harder press” rather than a (slower) long-press, for example. I’m sure Apple’s software gurus can come up with a million ideas better than mine.
Those factors, if Apple can deliver them, are what lead to best in class profit margins, driven by high average selling prices (ASPs). Doing this is what makes Apple so darn profitable.
The iPhone is the only Apple device (with a screen) that doesn’t have size options. So it seems obvious that Apple will add size choice to the mix. They need enough options to satisfy a global market with varying desires. Some people will want to buy a huge screen since it’s their only device. Others will go for something that easily fits in the pocket because they switch to an iPad when they feel like sitting down for a while.
But it also seems obvious that Apple isn’t going to move to bigger screens without doing something else. Apple doesn't work in a “me too” fashion. To paraphrase Steve Jobs, they figure out the experience they want to deliver, than assemble the technology they need to do it.
Next year, that experience could very well result in a bigger iPhone.
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