Why would Apple raise iPhone prices when all the money is in the mainstream?
This morning an analyst posted something speculative about the possibility of a price increase on the iPhone 6 when it is released later this year. The analyst in question has horrible history when it comes to making Apple predictions, so we're going to ignore the source. What we aren't going to ignore is the idea. Could Apple use the iPhone 6 as leverage to raise iPhone prices?
Here’s what I think: Apple does whatever it wants to do. If they wanted to raise the price by $100 they’d just do it and they would not ask for permission. Furthermore, Apple’s track record over a long period of time has been to add more functionality while holding prices flat or even reducing them. That's proven to be an incredibly successful, incredibly profitable strategy so far.
It may be true that the iPhone 6 will be the only smartphone in 2014 to be truly headline-worthy. It may be true that there isn’t a lot of differentiation among the other players in the market. But I don’t think any of that supports the idea of Apple breaking from a long tradition of providing people with more value for the same money (or sometimes less).
Last year Apple went so far as to introduce two new iPhones — the iPhone 5s at the same, consistent price point, and the iPhone 5c at a lower, mid-tier price point that had, until then, been occupied by a discounted version of the previous year's product.
Could Apple do the reverse — introduce a higher, even more premium-tier price point for a newer, perhaps even bigger and more powerful iPhone Pro product? That would depend on what their market research tells them. However, most much-larger screened devices are currently selling in markets that prefer cheaper, not more expensive products.
What do you folks think? Would you spend another $100 for an even more expensive iPhone?