Later this month, Apple is expected to launch three smartphones. The pick of the three is their 10th anniversary of the iPhone smartphones, the iPhone 8. This smartphone is expected to be a revelation, and apart from being a significant advancement in technology, it’s rumored to have seen Apple revamp the look of their iPhone series.
iPhone 8 is the most anticipated device of the year, and this anticipation on keeps on growing as the release date gets nearer. However, there’s one problem with this new apple product. It’s price!
For a long time, rumor has had it that this new iPhone will be going for about $1000. If that is anything to go by, then it means that iPhone 8 will be more expensive than the current smartphone at the cost of about $130 more.
The price has been attributed to the manufacturing process of the phone itself and the technology used. This new flagship smartphone for apple is rumored to have a bezel-less screen, a dual-lens, 3D capable back camera system, no home button and having a bigger memory than the previous version of the iPhone series. It is all this technology combined that is expected to drive the prices of iPhone 8 insanely high.
Samsung’s OLED Displays
However, the major player in this big price difference has been said to be the new OLED displays produced by Samsung. On Wednesday, Ming-Chi Kuo, a top analyst at KGI Securities, issued a note to investors.
He pointed out that Samsung holds the bargaining position over Apple at the moment. This is because Samsung is the sole supplier of OLED panels for iPhone 8. Ming-Chi Kuo notes that he suspects that Apple is being charged about $120-$130 for each OLED display. This is quite a high price considering that the LCD screens Apple has been using cost about $45 to $55 per 5.5-inch iPhone 7 Plus.
This means that the display for iPhone 8 sees a price increase of $80 in itself. Summing with the added expenses for the dual sensor camera, 3D sensing technology, increased chip power and higher memory among others, the price for this new Apple product is seemingly out of the tech-giant’s control.
This $1000 price tag is therefore not attributed to Apple wanting to take its profit margins to a whole new level. However, it will also not see Apple drop its margins on their most valued asset. On the contrary, according to the analyst, they have resorted to other methods of reducing cost production.
He noted that Apple needs to keep other alternatives in mind. This, however, doesn’t mean getting rid of Samsung, the only company that can deliver the required standards at the moment.
Apple is planning to introduce other players in the industry, and that will automatically drive Samsung’s prices down due to a less bargaining power. Two of these other players are said to be LG Display and Japan Display.
However, Samsung seemingly can’t be done away with. The Korean tech giants hold 97.7% of global OLED production, a statistic which was recorded in April of 2016. With the current situation, it will be interesting to see how Apple deals with this high material cost in the future.