Apple said to introduce cheaper 5G iPhones to attract budget customers

The entry level phone, according to Front Page Tech host Jon Prosser, will cost $649, at least $50 less than the cheapest phone in the previous series

People wearing face masks following the coronavirus disease (COVID-19) outbreak are seen at an Apple store as the new iPhone SE goes on sale, in Hangzhou, Zhejiang province, China April 24, 2020. China Daily via REUTERS  ATTENTION EDITORS - THIS IMAGE WAS PROVIDED BY A THIRD PARTY. CHINA OUT.
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Apple will not increase the price of its iPhone 12 series, which comes in four variations, despite adding 5G connectivity, according to Jon Prosser of YouTube channel Front Page Tech.

The phones will be the first 5G-enabled handsets from the iPhone manufacturer.

The entry-level phone in the 12 series – the 13.7-centimetre iPhone 12 – will be $649 (Dh2,383), at least $50 cheaper than the entry-level handset in Apple’s 11 series that was launched in September, according to Front Page Tech.

The flagship device of the new series, the iPhone 12 Pro Max, with a 17cm screen, will be $1,099 while the iPhone 12 and iPhone 12 Pro, both with 15.5cm screens, will be $749 and $999, respectively, Front Page Tech said.

“Things start getting interesting with the lower-end models that will be priced at $649 and $749,” said Mr Prosser who has run Front Page Tech since 2013.

The channel has more than 162,500 subscribers and Mr Prosser is widely viewed in the technology industry as a reliable source of information on forthcoming products.

Apple did not respond to The National's request for comments.

Last month, Apple launched its cheapest iPhone SE at $399. Cheaper offerings may help the iPhone maker compete with mid-range smartphones from rivals Samsung and Huawei and to meet its goal of 200 million shipments this year.

“It [the 12 series] is a long but balanced line-up of iPhones from Apple ... expect a delay in launch by a month or two, so expect new iPhones in October or November,” he said.

Known for launching new phones every September, Apple now faces a delay because of supply chain disruptions caused by the coronavirus outbreak, Bank of America analysts said.

The company is reportedly keeping the price of its 5G-enabled iPhones significantly low to attract budget-conscious customers.

Fifth-generation components will raise production costs by up to $100 but Apple will offset the price by “cutting on supply chain expenses”, Ming-Chi Kuo, an analyst at Hong Kong’s TF International Securities, wrote in a research note to clients.

Samsung, on the other hand, increased the prices of its latest 5G-enabled Galaxy S20 range, with prices starting at $999.

A 5G network promises internet speeds of up to 1.2 gigabits per second, with the speeds expected to gradually reach 10 gigabits per second – more than 100 times faster than what 4G offers.

It has a latency of less than one millisecond, compared with 20 milliseconds for a 4G network.

Many smartphone manufacturers such as Samsung, Huawei, LG and OnePlus already sell 5G-enabled phones.

The decision to offer cheaper 5G iPhones has come at a time Apple is going through one of the toughest phases in its recent history.

Net profit fell 2.7 per cent to $11.25 billion while iPhone sales dropped 7 per cent year on year in the second quarter to March 28 – a sign the company needs to rethink its strategy around its flagship device.

The company reported quarterly revenue growth of 1 per cent but did not provide a forecast for the first time in more than a decade. That sparked concern that its performance will suffer later this year.