14 DAY TRIAL // The cheapest iPhone launched this year is selling like hotcakes, and while at first glance this is good news for Apple, there’s at least one downside caused by this unexpected demand.
Deutsche Bank analysts claim that given so many customers purchase the cheaper iPhone, the actual average selling price, or ASP, of the iPhone is being pushed down, with estimates pointing to a decline of as much as 6 percent for fiscal year 2020.
iPhone 11, a direct successor to the iPhone XR, is available from $699, down from $749 for the model it replaces.
Cheaper iPhone coming next year
And according to the analysts, sales of the iPhone 11 are likely to grow up to a point where together with iPhone 8 and iPhone 8 Plus they could account for no less than 40 percent of all iPhone sales in the next 12 months. This means cheaper iPhones would become more successful, while the more premium siblings, which include iPhone 11 Pro and iPhone 11 Pro Max, would represent a smaller share of the sales.
As per Bloomberg, Deutsche Bank analyst Jeriel Ong say that growing demand for the cheaper iPhone could eventually lead to more units being sold, which at the end of the day, could compensate for the declining ASP. For now, however, it’s hard to anticipate whether demand for the iPhone 11 could stay at the same level in the long term.
Meanwhile, Apple is believed to be working on another cheap iPhone. A successor to the original iPhone SE, the new iPhone SE 2 could go live in the spring of the next year as a modern interpretation of iPhone 8, featuring an LCD screen, Face ID, and a single camera.
Rumor has it that iPhone SE 2 could remain a very affordable model that could be priced close to $399 for the base model, so high demand for this model could drag down the iPhone ASP even more.