Who’s balking at the iPhone X price tag?

The Wall Street Journal claims Apple sticker shock, the trade press piles on.

From Apple to Stick With Cheaper Screens as Consumers Balk at iPhone X Price Tag in Friday’s Wall Street Journal:

Apple Inc. is developing production plans for its next iPhones that stress cheaper liquid-crystal displays, in a sign of consumers’ sensitivity to the price of smartphones.

Apple expects LCD models to make up the majority of iPhone sales in its lineup to be released this fall, a greater proportion than analysts had anticipated, and plans to use the displays next year as well, said people involved in the Apple supply chain…

During a call with analysts last month, the company said the iPhone X was the best-selling of its eight smartphone models during the three months ended in March. But most iPhones it sells are still LCD models, analysts say.

My take: Provocative headline. I have several reactions.

  1. If iPhone X is the best-selling iPhone, where’s the evidence of sticker shock?
  2. LCD models outnumbered OLED models 7 to 1 this year. They will outnumber them again next year. So the news here is what exactly?
  3. RE: “A greater proportion than analysts had anticipated.” Did we learn nothing last quarter about the ability of Apple analysts to make sense of the rumors that swirl around Apple’s supply chain?
  4. The bias against Apple in the Wall Street Journal comment stream is deep.
  5. With the possible exception of MacDailyNews (“As expected”), the tech trade press gaggle is a bunch of sheep. I counted 18 me-too headlines this morning, including several that went well beyond me too, such as…

7 Comments

  1. Fred Stein said:
    Philip, I agree with all five points.

    Interesting and ironic: In the WSJ article there’s a forecast chart from Display Supply Chain Consultants indicating that OLED shipments are poised for higher growth rates in 2018 to 2020. But these are just forecasts and they are not Apple specific.

    Apple also pushed it’s price range down to $349. They will keep the low-end price intact and hence keep LCD for a while. If ASP goes lower, it is fine as long as the installed base keeps growing. Guesses about OLED/LCD model mix don’t matter.

    4
    June 16, 2018
  2. Turley Muller said:
    I wasn’t aware that everyone was expecting ALL 3 to be OLED. Rumors i read claimed there would still be LCD. I ludicrous to think Apple would release all new models near $1K and offer nothing new at the usual 600-700 range. There might had been hope that all 2018 would be OLED, but costs haven’t come down as expected. And memory prices and other components are up. Dollar is stronger. Shipping costs rising. Dollar has strengthened. And.. and.. we just started a trade war. With margin pressures, why box yourself in relying on a single technology from a sole supplier? Making a big assumption that the iPhone X sold poorly according to whom’s expectations I don’t know – because they balked at the price. Several people that got the 8 instead of X told me they were unsure about the whole Face ID and no home button thing, they been more than happy with the legacy models. And my 70 year old parents.- having to learn new gestures scare them to death. X is not for everyone, but it strangely appeals to some evidenced by being the top seller. Apple is leaving money on the table if they don’t offer a higher priced model for that segment willing to pay more.

    3
    June 16, 2018
  3. Gregg Thurman said:
    We shouldn’t be surprised that so “journalism” is crap. It’s how “journalists” are educated. “Dog bites man is not news”, whereas “Man bites dog IS news”. The first rule of journalism, if Man bites Dog story isn’t apparent, is to find/makeup the Man bites Dog slant.

    The second rule of today’s journalism is that the writer doesn’t (and too often isn’t) have to be an expert in what is being written about.

    Finally a total lack in logical thinking is paramount.

    The WSJ writer in this case has no logical thinking skills, is desperately seeking a man bites Dog angle and obviously hasn’t a clue about what he is writing. In other words he is on a rapid advancement track

    My position has been consistent since I first hypothesized that Apple will introduce 3 new iPhones this September, only instead of 2 OLED models and one LCD model, I expect Apple to introduce one OLED (an iPhone X Plus) and 2 LCD iPhone 9 models.

    I expect the base iPhone X Plus will be offered at $999, with the bast iPhone X (same iPhone X introduced last September) being price reduced to $899 (standard practice for second year models).

    IF, and I want to emphasize IF, Apple introduces an edge to edge iPhone 9 it’s base price will be increased from $699 to $799.

    Even without the price increase of the LCD iPhone 9, iPhone ASP will increase as the $899 price (missing last September) is filled. ASP will continue to rise (without Apple raising prices anymore) as LCD models are pushed down and out of the product lineup by newer OLED models fill the current product lineup.

    But, being true to the new “journalist” creed, my ‘out’ is that all the above could be wrong.

    2
    June 16, 2018
  4. Atul Barry said:
    Fake news, folks, fake news!

    0
    June 17, 2018

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