There has been recent hype about the iPhone 8 and in particular, word that the starting price of the latest device would increase to about $1,000. In my opinion, I doubt this will happen and even if it does, I can explain why what most consumers are paying now, isn’t really that different from the “alleged” price hike.
The current iPhone 7 retails for $649 for the baseline 16 GB version. However, the price can jump upwards of $900 when you buy the Plus version and crank up the storage. The key is that phone carriers are good at hiding the true retail price we are paying. While most carriers have made way with subsidized prices which were typically $199 for most flagship devices, the data plans often times made up for the difference. Today, people pay monthly installments of a device over the course of two years in return for a slightly cheaper data plan. In the end, customers still end up paying the full price.
Take the iPhone 7 16 GB version. It retails for $649. When you divide it by 24 months, you’ll pay $34.21/month plus the data plan. That means that by the end of the two years, you still paid the full amount.
Likewise, if the iPhone 8 does indeed become more expensive, most consumers would probably not notice too much of an increase on their bills because the payments are broken up into 24 months. When $1,000 is split into 24 months, it would be about $41.66/month and suddenly that doesn’t seem that bad.
Consumers should also note that the iPhone is one of the few devices that don’t depreciate in value as quickly as its Android counterparts. For whatever the reason may be, the iPhone has an excellent resale value. That being said, as long as consumers sell their iPhone before the next iteration is announced, they can expect to get a reasonable amount back when timed well.
All products and services are eventually doomed to increase in price. Whether that may be due to inflation or an increase in materials, it would be naive to expect prices to always remain the same. Netflix is a prime example, when the company used to offer it’s cheapest plan at $7.99 until it increased it to $9.99. Although, it was only a $2.00 increase, consumers were annoyed, yet they still stuck with the company and in return Netflix enjoyed an increase in subscribers due to popular original content and demand. That being said, the iPhone’s potential price increase should not be something to be scared about.
Image Source: Macrumors