Actually, the math favors a fun size 4-inch iPhone in ways you won’t believe. And not just because many people prefer a smaller phone. Apple CEO Tim Cook himself said more than half of all Apple’s iPhone customers still use a 4-inch iPhone, and with about 700-million iPhone customers in the wild, that’s a healthy number. But there’s more.
Numbers Don’t Lie
After reflecting on all the reasons why a 4-inch iPhone could debut soon, and they’re valid; made more so by upgraded internals, faster CPU, a better camera, et al. But the real reason Apple will push a new and updated 4-inch iPhone onto the market is revenue and profit protection.
Wait a minute. How can a lower priced and smaller iPhone protect the revenue generated from a set of larger iPhones; iPhone 6, iPhone 6 Plus, iPhone 6s and 6s Plus? It’s that old pricing migration model which Apple uses so well on every product, simply updated for the iPhone.
Right now, the entry-level iPhone is the iPhone 5s, which, in the 16GB version starts at $450. The 32GB version is about $50 more. That’s entry level, folks. The larger 4.7-inch iPhone 6 model, again with only 16GB of storage, is $100 more at $549, while the even newer iPhone 6s model is yet another $100 more at starting at $649.
See the migration points?
Folks who dine on Apple rumors for a living insist the new 4-inch iPhone will be called the 5se and not the 6-anything, but it doesn’t matter. That phone exists for two reasons, and will get updated, upgraded, and refreshed with faster CPU, improved camera, modern case, and a few other goodies for just those reasons.
Apple has a few hundred million iPhone customers who want a smaller iPhone and would prefer to be treated fairly and have the newer CPU, a better camera, and the like, and they’re willing to pay for it– but not get three model years of age for the price. The other reason is the aforementioned revenue and profit protection the entry-level iPhone provides for the more expensive models; each easily differentiated from one another because of price and screen size.
Frankly, Apple should call the 4-inch iPhone the 6se but that would sound too familiar and similar to the iPhone 6s line, so iPhone 5se it is. Next year, when the iPhone 6 and 6 Plus are discontinued and the iPhone 7 makes a debut, the iPhone 6s and 6s Plus, will become the second tier, and maybe then we’ll see an upgraded entry-level iPhone with the iPhone 6se monicker.
The hard numbers are telling. The iPhone 5s starts at $450, but is a few years old. iPhone 6 line is newer, but priced less than they were last year. The big money comes from the new iPhone 6s line, but Apple’s product line leaves a few hundred million customers who prefer a smaller, less expensive iPhone with older technology. That’s not good for the customer base, so, ipso facto and Voila! iPhone 5se with new camera, new CPU, and new case.
See? Everybody gets what they want. Except maybe Samsung which still cannot sell Galaxy S6 for as much as last year’s iPhone.