Apple’s premium OLED iPhone 8 is expected to carry a pretty premium price. But, according to Barclays analysts, Apple could offset that price tag by bundling the device with included Apple Music and iCloud subscriptions.
The iPhone 8 (a.k.a. iPhone Edition or iPhone X) is expected to start at $1,000, according to the latest rumors. That’s a risky launch price, and Apple has an interest in keeping the premium flagship from feeling overpriced. As market analyst Wamsi Mohan puts it, “anything significantly over $1,000 as the price for the lowest SKU of the iPhone 8 could be potentially detrimental to demand.”
But Apple could use a variety of tactics to win over potential customers. One theory, put forth by Barclays analyst Mark Moskowitz and his team, is to bundle a free year-long subscription to Apple Music as well as offer a year of 200-gigabyte iCloud storage to every consumer who purchases the iPhone 8, Business Insiderreported.
One year of Apple Music costs about $120 at the standard $10 a month rate. Similarly, a 200GB iCloud storage runs about $2.99 a month, adding up to about $36 a year. A bundle containing both could equate to about $156 — bringing the overall perceived “price” of the phone down to $844 at its most basic configuration. The Barclays team, who based their prediction on a survey of wireless customers, says that the deal would feel “more palatable” to potential buyers.
Of course, while the tactic could turn out to be a smart move on Apple’s part, it is just a prediction. Barclays has a decent history of calling Apple’s moves, but this particular prediction hasn’t been corroborated by Cupertino itself, or any other sources — yet.
As for why the iPhone 8 will cost so much, it’s expected to carry a number of revolutionary features that may be owing to its higher price tag. Similarly, Samsung’s monopoly on the OLED display market could be driving up the retail price for the premium device. According to estimates by renowned Apple analyst Ming-Chi Kuo of KGI Securities, the total unit cost per OLED display stack could be around $120 to $130 — a significant markup over the $45 to $55 unit cost of traditional LCD panels.
The iPhone 8 is largely expected to sport an edge-to-edge OLED display with minimum bezels and no Home button. In place of the iconic button, the premium flagship is rumored to rely on advanced facial recognition technology for authentication and gesture-based controls. As far as other upgrades, the device is likely to sport advanced augmented reality capabilities, a vertically oriented dual-lens camera module and inductive wireless charging.
In a separate report today published by DigiTimes, the iPhone 8’s starting prices have been pegged at $999, $1,099 and $1,199 for the 64GB, 256GB and 512GB storage options, respectively. As far as availability, other recent rumors suggest that the device might be plagued by supply shortages, and may even launch late.