This week, Apple executives are expected to show off the iPhone 14 at the company’s headquarters in California. The device probably hasn’t changed much, though. There are rumors that the notch where the selfie camera is could be smaller, and Apple will probably talk about how fast games run or about new technology that keeps the screen on all the time. But the 5G wireless feature that was introduced two years ago will be the one that the company will bet on most to bring in customers. So what will depend on iPhone 14 Success?
Yes, 5G is old news for some people. For some people, 5G is just a bigger number than 4G. But more and more data shows that 5G wireless is becoming almost as important in today’s iPhones as battery life and storage space, which are the two things people care most about when they buy a phone. The current wireless standard, which has been around for a few years and is offered by all of the major US carriers, is the second most common reason why people switch mobile providers, after “better value for the money.”
This is a big change from how 5G was seen when it first came out and in its early years when there was a lot of hype but not much coverage. But the carriers have put billions of dollars into the infrastructure and airwaves to support it, which has led to better service in many places.
Tim Cook, the CEO of Apple, is one of the biggest fans of 5G. Since the iPhone 12 introduced the technology in 2020, he has talked about it almost every time he has talked about iPhones in public. Even though inflation was going up and a recession might be coming, he said in July when talking about the future of his company’s phones.”I think there’s cause to be hopeful,”
Every year, it seems like the iPhone’s popularity is put to the test, and this year will be no different. By almost any measure, the iPhone is the single most important product the company makes. Last year, Apple made more than half of its money from iPhone sales, which brought in more than $191.97 billion. A lot of the technology used in the iPhone has spread to the rest of Apple’s business. Products like the Apple Watch, AirPods headphones and iPad tablet have become multibillion-dollar businesses in their own right.
It has also helped raise Apple’s value to more than $2.5 trillion, up from Wall Street’s estimate of $60.7 billion when the device was first announced 15 years ago. Apple is now the most valuable company in the world, followed by Saudi Aramco, Microsoft, Alphabet (Google), Amazon, and Tesla, which makes electric cars.
The big picture.
This year, though, the success of the iPhone won’t just be measured by how much money Apple makes from selling it. It will also be a good indicator of the economy as a whole because it will show how much people are willing to spend when confidence in the economy is at its lowest point in decades. Businesses of all sizes have cut back on hiring or started letting people go, just like Snap, a smaller social networking site that competes with Facebook, did last week.
Even though 5G isn’t a big deal in the tech industry, it may be the key to Apple’s success in the bad economy we all seem to be in. Wedbush Securities says that about 240 million of the 1 billion iPhones in use around the world haven’t been updated in the last three and a half years and can’t connect to 5G networks because of this.
People with older iPhones will probably upgrade at some point, especially if wireless carriers offer free movie and TV services as an incentive to upgrade. Wedbush analysts told investors earlier this summer, “The stickiness of the iPhone upgrade cycle is still being underestimated.” “This is still Apple’s biggest advantage over other tech companies.”
Think of a 5G dream
A strange thing about the 5G upgrade cycle may be that people are buying in, meaning they don’t want to buy new phones that don’t have 5G, but 73% of respondents to Deloitte’s surveys said they wanted a “better understanding” of what 5G offers and 30% said they’re disappointed by “a perceived lack of innovative apps and services that leverage 5G.”
When carriers started promoting 5G a few years ago, they talked about how it was the next generation of wireless technology that could lead to a future full of sci-fi devices. The promise of 5G is everywhere, from self-driving cars to remote medical care to smart cities.
So far, 5G has mostly lived up to its promises of faster speeds and more reliable connections.
Carriers, on the other hand, have helped convince people that 5G is important by turning off older 3G services. This has forced some people to upgrade and has indirectly warned 4G users that they will be next.
Now that the economy is getting worse, people have to think more carefully about buying devices that they might not upgrade for a few years.
“If you’re going to buy a smartphone, you’re going to buy the best one you can for a certain price,” says Maribel Lopez, the head of Lopez Research and a longtime observer of the industry. Some people have to make tough choices when the cost of food rises by 30% and the cost of gasoline rises by 100%.
She said that no one would buy a 4G phone today unless they needed a cheap phone.
Shiny Apple
Even though all of these things are happening, it doesn’t mean that Apple’s iPhone is sure to be a hit, even though the world economy is getting worse.
To make the release of the iPhone 14 more appealing, Apple’s teams are working hard on the iOS 16 software update. This update will include new “widgets” that add information to the lock screen, the ability to undo a sent email in Mail, and better security.
They may also be working on new features like the always-on display, which would let iPhones show limited information on the screen even when it’s usually off, and emergency satellite texting, which could come in handy if you get stuck on a desert highway or in the middle of the ocean.
Some people might think that all of those features are just there to add something new to the box this year. But Carolina Milanesi, an analyst at Creative Strategies, said that Apple needs to be careful about adding features that matter to “early adopters” and “premium buyers,” who are “critical to the brand perception.”
She said, “You can’t make that high-end user feel left out or forgotten.” And for everyone else, she thinks that carriers will offer subsidies and other freebies to show people that the real big changes will be in the phone’s value.
