The event will mark the 10th anniversary of the iPhone, a product that revolutionized entire industries and transformed a venerable but niche Silicon Valley firm into the largest and most profitable company on the planet. Apple has ruled the roost in the smartphone industry so definitively for the past few years that some of the drama has drained out of its phone unveilings.
But this year, the company seems determined to try something new. Not just an upgraded iPhone (though there will certainly be one of those) but an additional deluxe iPhone of some kind at what we anticipate will be a strikingly higher price point. It’s a bold move that could open new frontiers of growth for a company that’s so big already it’s becomehard for it to find new big opportunities.
What to expect at the iPhone event
At the September iPhone event, one expects, of course, new iPhones.
Specifically, leaked builds of the next version of Apple’s iPhone operating system strongly suggest that, true to form, we will see the current iPhone 7 and iPhone 7 Plus succeeded by brand new models named iPhone 8 and iPhone 8 Plus. These phones will look the same as the existing models but will be upgraded with improved internals — faster versions of Apple’s custom-designed A-series chips and improved cameras that won’t necessarily wow owners of existing top-of-the-line iPhones but should tempt iPhone 6 and 6s owners to upgrade.
Unless something goes catastrophically wrong for Apple, the regular-size version of this phone will swiftly become the best-selling smartphone on the planet and very possibly the best-selling smartphone of all time. It will drive billions of dollars of economic activity around the world, both through the upstream supply chain of parts used to manufacture the phone and through the downstream app economy that depends on regular updates to the power of the now-ubiquitous strain of pocket computers that Apple pioneered 10 years ago.
And it’s a remarkable testament to Apple’s success on both the level of vision and execution that this phone, like the iPhone 7 and the iPhone 6s before it, will be boring.
The real news — or so everyone thinks — will be something else entirely.
Apple will roll out a new high-end phone
Rumors from the Asian parts supply chain have become ubiquitous that alongside the two upgrade models, Apple will try to do something new and unexpected this year — make a third, high-end phone.
This product, likely called the iPhone X, will have a different case shape and build materials than the existing phone.
Expectations call, in particular, for an edge-to-edge screen with no bezel and no physical home button. This will allow the iPhone X to have a larger screen (people like big screens) without being physically larger overall (people also like small, easy-to-hold phones). The screen will likely feature a high-quality OLED display. Questions have been flying for months about how, if at all, the new phone will replace existing TouchID functionality without a physical home button. One recent report holds that there will be no TouchID at all, while other speculation has featured TouchID on the back of the phone or some way to embed it beneath the surface of the screen.
The rumor mill is also calling for the use of some kind of special high-end materials, perhaps including the ceramic and sapphire used in the highest-end versions of the Apple Watch.
And it will likely be expensive — maybe $1,000 or even $1,500 or more. In many ways, that’s the point.
Why Apple wants to make a luxury phone
To make money, of course. The $700 entry price Apple has used for past phones (and will stick with for the iPhone 8) is a proven winner that has already made Apple more money than any company in the history of the world has made. Apple is really good at making phones that sell in high volume at that price and is able to extract very hefty profit margins for its trouble. So why mess with a winner?
The essential issue is that Apple is torn between two imperatives.
The iPhone’s thing is that it’s the best phone. But the iPhone’s other thing is that it’s the best-selling phone. That means that whatever went into the iPhone 7 and the iPhone 6s had to be things Apple was capable of obtaining or manufacturing in enormous volumes. That necessarily means leaving some technically feasible things on the cutting room floor — including things like no-bezel OLED displays that competitors not blessed with Apple’s sales volumes are already doing.
Hence the appeal of a phone that is deliberately priced too high for most people to buy. The iPhone has never been a cheap product, but at least since the iPhone 4 it’s always been a good valueproduct that appeals to the mass market. The iPhone X won’t be like that. It’s a niche luxury product that will be produced in limited volumes — with about 10,000 made per day, according to recent reports.
New watches and Apple TVs could be coming
Both the Apple Watch and the Apple TV are small fish in the Apple ocean, but Apple has a strong leadership position in the smartwatch industry that it probably doesn’t want to lose, and the Apple TV is strategically significant to many of Apple’s ambitions around home automation.
Updates to these products don’t come on a particularly regular basis, so there’s no sure thing here.
However, both products have a fairly obvious technical direction to evolve in for the near term. The first Apple Watch was essentially useless unless it was in Bluetooth range of an iPhone. Thesecond go-round of the Watchincorporated its own GPS chip so runners could use it phoneless and still track their workout. From day one, it’s been clear that including an LTE chip in some future watch to liberate it from the phone link would be highly desirable. Actually doing it is simply a question of when the engineering technology will be available to add cellular data without desperately compromising battery life.
The Apple TV, meanwhile, has fallen behind competing digital boxes when it comes to being able to display 4K video. Apple is expected to release a new 4K-capable version of the product, likely named Apple TV 4K.
The launch of a new set of phones is also a perfect time to demonstrate the capabilities of the next version of Apple’s mobile operating system, iOS 11, which has been available to developers in beta mode for some time now but which will come to consumers soon. One big chunk of the new iOS software is aimed at theiPad market, where new features may not transform Apple’s signature tablets into a full laptop replacement but do make it an increasingly robust computing platform. Things like the redesigned dock, advanced multitasking, and new drag-and-drop features are the standouts here and may get featured at the September event.
Features shared with the phone — such as the bigger, consolidated Control Center, the new, grid-like app switcher, and the new file storage app called, simply, Files — will almost certainly come up.
More spectacularly, iOS 11 will also see the debut of AR Kit, Apple’s suite of developer tools for creating augmented reality apps. AR means, basically, digital tools that can interact with the “real” world — Pokémon Go is probably the best-known example — and the promise of AR Kit is that it will allow the creation of much more sophisticated 3D overlays without requiring extensive computer imaging expertise.
If it lives up to that promise, AR Kit could give birth to a whole new generation of advanced apps that drive demand for the more powerful smartphones and tablets of tomorrow — ultimately boosting sales and advancing Apple’s bottom line.
How to watch the iPhone X event
Starting time: San Francisco: 10 am / New York: 1 pm / London: 6 pm / Berlin: 7 pm / Moscow: 8 pm / Beijing: 1 pm (September 13) / Tokyo: 2 am (September 13) / Sydney 3 am (September 13)