…rumors that Apple will sell a USD 399 iPhone at the beginning of next year…
Now there are rumors that Apple will sell an ultra cheap iPhone at the beginning of next year. This model will be available for USD 399. Since the iPhone SE in 2016, there has not been such a cheap iPhone. The new iPhone will also be cheaper than the current iPhone 8, which Apple is currently selling for USD 449.
I think Apple has something completely different in mind here. Apple is simply changing its strategy. Instead of a price skimming strategy, it now uses a form of penetration strategy. In principle, this strategy initially keeps the price as low as possible in order to gain a high market share quickly. Apple’s strategy will be similar. However, the group does not aim to necessarily gain higher market shares in the mobile phone sector (which is of course welcome anyway). Apple simply wants to keep its customers in the Apple ecosystem. Because in the discussion about iPhones sold, investors must always consider the following. Apple is no longer a phone manufacturer. As far as Apple is struggling with problems regarding smartphone sales, there is of course the fact that the cycles are now longer until a new iPhone is bought. In this phase there is a great opportunity to bind the hardware customers to the software services. This makes it more likely that customers will buy a new iPhone later. And that’s why Apple is investing aggressively in the service business.
Apple can counter the feared loss of the status symbol through the design because the cheap mobile phone should have the same processor as the iPhone 11, but look like the iPhone 8. I am absolutely convinced that Apple is able to set itself apart from other manufacturers and set new standards through design alone.
…Some investors think that’s too high. But the problem is that they look at Apple from a different perspective than I do. They see Apple more as a value company. This is, of course, supported by the fact that Apple is now developing into a steady payer of dividends. However, I disagree with this assessment at all. Apple should be valued much higher as a growth company, which is why I continue to see great potential in this share.