What you need to know
- 5G in the iPhone 12 will not significantly increase its cost.
- That's according to the latest from analyst Ming-Chi Kuo.
- Apple is going to offset the cost by saving money on other components.
A new report from Ming-Chi Kuo says that the adoption of 5G in the iPhone 12 will not "significantly" increase the cost of the device, despite the more expensive components required.
In a research note seen by iMore, Kuo reports that several Apple suppliers are being squeezed by Cupertino, as it exerts more bargaining pressure on suppliers to save on the cost of other parts.
Kuo notes that the cost of 5G in the iPhone 12 is around $75-85 for sub-6 5G (the slower version) and around $125-135 for mmWave (the faster version). Kuo says that in order to maintain sales momentum, Apple will not significantly increase the price of the iPhone 12, despite this increase in cost.
Instead, Apple plans to use cheaper components in other parts of the iPhone to reduce cost, but only on the premise that it doesn't hamper the user experience. As a result, Apple suppliers are finding themselves under increased bargaining pressure this quarter.
Notable savings include a new battery panel which is 40-50% cheaper than the iPhone 11. Looking further ahead, Kuo says the 2021 iPhone will use a totally new battery panel, which is 30-40% cheaper than the one featuring this year.
As early as April, Jon Prosser leaked what he says are the upcoming prices for the iPhone 12. Apple is expected to launch four new models of iPhone in three different sizes, all featuring 5G:
Kuo's latest report seems to confirm that even though the new iPhone 12 will be more expensive to make because of 5G, Apple will be able to save enough money on other parts that we shouldn't see too much of a price increase if any when the phone is released.