It’s getting harder and harder to make your smartphone stand out from the competition, even if you own one of the best phones on the market. Everything from screen refresh rates to camera specs has evolved to be nearly identical from phone to phone, and if one device offers a particularly clever software feature, it won’t be long before competing phones are adapting a version of their own.
That’s the challenge Apple faces as the iPhone 16’s likely September release date approaches. Indeed, based on iPhone 16 rumors, the biggest potential changes — larger screen sizes for the iPhone 16 Pro models, new chipsets, and capture buttons for everything — are the kind of improvements you’d expect to see, but not the kind that would make your heart race.
But there is one thing Apple could do with the iPhone 16 this fall that would absolutely set its new phones apart from many other high-end models released this year: It could keep the prices of the new iPhones in line with what Apple charges for current models.
2024: The year of rising phone prices
OnePlus 12 and Samsung Galaxy S24 Ultra seen from the back
The OnePlus 12 (left) and Galaxy S24 Ultra (right) both cost more than their predecessors. (Photo credit: Tom’s Guide)
Releasing a major flagship in 2024 seemingly comes down to asking how much to charge for it — the answer in many cases seems to be “more expensive than what we did for the last series of phones.” Samsung started this trend in January, when the Galaxy S24 Ultra added an extra $100 to the S23 Ultra’s starting price, bringing the new phone’s price to $1,299.
Shortly after, the OnePlus 12 arrived in the US, with the phone costing $799, a $100 price increase over its predecessor. Here, at least, a current promotion lets you bring the phone’s price down to $699, provided you have a current device to trade in.
Even foldable phones, which are already among the most expensive devices you can buy, aren’t immune to price increases. Samsung introduced the Galaxy Z Flip 6 and Galaxy Z Fold 6 this month with corresponding $100 price increases over their predecessors. That means the latter phone now starts at a staggering $1,899.
We don’t know if any price hikes are planned for Google’s hardware event in August, where we expect to see the Pixel 9 phones debut. But there’s at least one rumor pointing to potentially higher prices, at least for some of the four different phones Google could be showing off. That would follow $100 increases for the Pixel 8 and Pixel 8 Pro over their predecessors.
Apple isn’t without precedent in this discussion, either. While it has maintained the prices of three of the four iPhone 15 models it released nearly a year ago, the iPhone 15 Pro Max’s $1,199 starting price is $100 more than the iPhone 14 Pro Max.
What will Apple do with iPhone 16 pricing?
Four alleged iPhone 16 mannequins, with their sizes written above them.
(Photo credit: Sonny Dickson / X)
These price increases are not due to arbitrary reasons. The cost of parts used to assemble phones is also rising, and in some cases, phone makers have decided to pass these costs on to consumers, likely to maintain profit margins on their new devices.
It’s unclear whether these same cost pressures will be felt at Apple when it comes to pricing the iPhone 16. Granted, we haven’t heard any talk of a potential iPhone 16 price increase to date, but that’s the kind of detail that tends to leak right before a new phone launches. As July turns to August, we’re at the point where iPhone 16 pricing rumors could soon be taking shape.
Of the four rumored iPhone 16 models, the iPhone 16 Pro and iPhone 16 Pro Max seem the most likely to see price increases, given the improvements that are reportedly coming to those devices. We’re expecting phones with larger displays, and the iPhone 16 Pro is expected to benefit from the improved telephoto camera that Apple brought to the iPhone 15 Pro Max — the only iPhone from last year that faced a price increase.
However, Apple has many reasons to maintain the price of the iPhone 16 Pro. The negative impact of the iPhone 15 Pro Max price increase was somewhat mitigated by Samsung’s decision to increase the price of the Galaxy S24 Ultra a few months later. As a result, there is still a $200 price gap between the high-end devices offered by Apple and Samsung. This is important from a psychological point of view.
But the $1,000 threshold is even more important psychologically. If you stay below that threshold, even by a dollar, people will have an easier time hitting the buy button than they would for a $1,099 device. One can imagine that this will weigh in Apple’s thinking when it considers the $999 niche in its current lineup.
There’s also a good argument for keeping the iPhone 16 and iPhone 16 Pro at the same $799 and $899 price points as their predecessors, respectively. A big part of this year’s iPhone upgrade cycle is the new Apple Intelligence features coming to Apple’s phones this year, as Apple leverages AI to power new writing and image-generating capabilities.
Apple Intelligence requires a phone with an A17 Pro chipset or better, which means the iPhone 15 Pro models are the only existing iPhones that can support these features. If Apple Intelligence’s features prove compelling enough, one can imagine people will be motivated to upgrade to a new iPhone. And that’s a lot easier to do when the starting price of an iPhone 16 model remains $799.
Defeating the Apple Tax
Apple has a reputation, not without reason, for charging higher prices than its competitors, something known as the Apple tax. So imagine the reaction when CEO Tim Cook takes the stage at Apple’s iPhone 16 launch event and declares that the company isn’t raising the price of its latest devices by a cent. It’s the kind of marketing stunt that extra money simply can’t buy.
More information on Tom’s Guide
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