Weak demand for the 'budget iPhone' may lead to Apple slashing prices in Japan and other markets while an earlier deal with Samsung may force Apple to revive production of the iPhone X, Wall Street Journal reports.
While Apple hoped the iPhone XR (review) will help the company acquire more users in developing markets, it’s reception has reportedly been lukewarm in most markets. In Japan, Apple may even slash the price of the iPhone XR and even revive the production of the older iPhone X even though Apple’s official stores doesn’t sell the device anymore.
A report by Wall Street Journal states that Apple will offer “subsidies to mobile-network operators in Japan to shore up sales” of the iPhone XR. Major wireless carriers in Japan will reportedly slash the price of the iPhone XR next week.
The iPhone XR is the budget iPhone that’s difficult to be called a budget phone at the very least. It features the same Apple A12 Bionic chipset that powers the iPhone XS and the iPhone XS Max, so the performance of the iPhone XR is similar to its more expensive siblings. To keep the costs down, the iPhone XR uses a Retina LCD display that’s not even full HD while the camera on the back has only a single lens. Nevertheless, it can still take excellent portrait photos, but the portraits are restricted only to human faces as Apple uses computational photography to implement the depth of field effect.
Apple did sell a whole lot of iPhone X on the other hand, which was the company’s big surprise as part of the iPhone’s ten-year anniversary. It marked a titanic shift in design with a bezel-less display with gesture navigation and face unlock. The physical home button with TouchID was sacrificed and the iPhone X introduced the hideous notched display to the market. The iPhone X was also the first time Apple used an OLED display which is manufactured by Samsung. Now, it’s the same manufacturing deal that’s making Apple revive the production of the iPhone X.
The Wall Street Journal report states that because of an earlier deal with Samsung under which Apple had to buy a certain amount of OLED panels, it has to revive the production. Even though Apple could have simply shored up the production of the iPhone XS which has the same display size as last time, the iPhone X which is now more affordable is more popular in emerging markets like India. The new iPhones breach the Rs 1-lakh price point in India and goes all the way up to Rs 1.45 lakhs for the iPhone XS Max.
Apple also forecast lesser sales in the Christmas quarter in its quarterly earnings report. The company’s CFO Luca Maestri had said the company would have “uncertainty around supply and demand balance.” and said that the company is facing “some macroeconomic uncertainty, particularly in emerging markets.”
Noted analyst Ming Chi-Kuo reported that Apple has cut down production of the iPhone XR because of weaker deamnd. He said Apple will sell an estimated 70 million units of the phone for the fourth quarter of 2018 till the third quarter 2019.
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