Don't bank on the iPhone SE 2 being a smash hit

Apple is expected to launch the update to the iPhone SE, possibly as early as today. But don't get too excited, because cheap iPhones are a hard sell.
Written by Adrian Kingsley-Hughes, Senior Contributing Editor

Love it or hate it, it's hard to escape the fact that the iPhone has been a massive hit over the past decade. But that broad generalization hand-waves over some subtleties -- and that is that cheap iPhones are a hard sell for Apple.

Let's begin with Apple's first foray into cheap(er) iPhones -- the iPhone 5C. Unveiled alongside the more expensive iPhone 5S in September 2013, it was a good phone (the biggest difference between the two was that the 5C lacked the fingerprint reader), however, over the first three days of sale, Apple shifted three iPhone 5S handsets for every iPhone 5C it sold.

Initially launched with 16GB and 32GB capacities, after a few months Apple released an 8GB version. The 16GB and 32GB versions were discontinued September 2014, with the 8GB version abandoned by Apple a year later.

Apple was in no rush to release a revamped iPhone 5C.

Then in March of 2016 Apple released the iPhone SE. You might say that this replaced the iPhone 5C, but in fact it replaced the iPhone 5S. Storage capacity was initially 16GB and 64GB, but a year later these were replaced models with 32GB and 128GB of capacity.

The iPhone SE was discontinued September 2018, and Apple was in no rush to release a revamped version.

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Cheap iPhones are hard to sell.

The truth is, while there's been excitement in the tech media for a cheap iPhones, customers aren't all that thrilled by them. When Apple released unit sales data for iPhones it was possible to work out the average selling price, and this pretty much always suggested that consumers were drawn to the more expensive handsets.

An interesting question to ponder is why.

While I think that there's some truth to the idea that the iPhone is a premium brand, and releasing a cheap version of something premium causes too much dissonance, I think the real reason is simply that cheap iPhones really aren't that cheap. A non-contract iPhone 5C started at $549 for the 16GB version, while a 16GB iPhone SE was $399.

These prices aren't cheap by any definition. Cheap by Apple standards, but not by the rest of the smartphone market.

Another factor is that the cheaper end of the smartphone market is super crowded, and manufacturers are clamoring over each other to offer the most tempting deal. $400 buys you a lot of smartphone, more so if you look outside of the iPhone ecosystem.

What has changed since the release of the iPhone 5C and SE is that the price of the top of the range iPhone has broken the $1,000 barrier, and now a $399 iPhone SE 2 might seem more tempting.

But is "more tempting" enough? If cheap iPhones really were what people wanted, why have they not been a cornerstone to Apple's empire?

Will you be buying a cheap iPhone? Why or why not?

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