One of the biggest letdowns of this year’s Worldwide Developers Conference was the lack of updates on hardware, particularly about whether or not the company is working on a follow up to the more budget-friendly iPhone SE.
It’s not exactly a surprise; WWDC is about software. But the company’s presentation still laid bare why iPhones at a lower price point seem inevitable at some point. In short, the hardware business is cyclical and volatile, explained Andrew Chang, an analyst at S&P Global who follows Apple. The best way for Apple to keep growing is by focusing more on its software ecosystem.
“It’s a consumer oriented hardware company, and that’s a business prone to cyclicality, people buy a phone one year but not the next,” Chang tells Inverse. “But in the last few years, Apple’s been extremely successful in harvesting their services business. It’s extremely important in terms of strengthening their ecosystem, which will get users to stay in.”
Read More of Our WWDC Coverage Below:
- WWDC 2018: 4 Ways Apple Will Help You Unplug and Fight Smartphone Addiction
- WWDC 2018: Apple iOS 12 Is Here With Amazing New iPhone Updates
- WWDC 2018: 5 Tech Firms Apple Just Tried to Kill With iOS and macOS Mojave
Lots of the most important announcements from WWDC — improvements to Siri which allude to better smart-home products or the early stages of integrating some iOS apps into MacOS Mojave — are all aimed at strengthening that ecosystem.
If you’re just as much a customer of Siri, Apple Music, or Photos, as you are the devices that house them, you’re going to be that much more likely to continue replacing your iPhone with more iPhones, and opting for other Apple hardware even when given the option of more impressive or cheap alternatives.
The relationship between lower priced smartphones and the importance of Apple’s ecosystem was echoed in a recent research note by the Apple analyst Ming-Chi Kuo that was first reported by MacRumors.
In the note, Kuo laid out three reasons alongside a prediction that Apple would adopt a more aggressive pricing strategy: Consumers expect cheaper smartphones now, iPhones are getting cheaper to produce, and it wants to spread the adoption of Face ID, in doing so “benefiting the promotion of the Apple service and ecosystem.”
iPhone SE 2: Rumored Name, Specs, and Features
There are supposed to be roughly three different prototypes of a new iPhone SE phone, according to the Japanese blog Macotakara, though few of the leaks pass the sniff test. The prominent Apple leaker Evan Blass also shared an image on Twitter suggesting that a follow up to the iPhone SE was in the works.
What would the new phone look like, exactly? So far, the more credible of the leaks have suggested that the new smartphone will have a bevel-less design and Face ID, but will also likely be a little thinner and be manufactured using a slightly cheaper LED screen. To get the real skinny, we’ll probably have to wait until the September iPhone announcement.