Apple held back launch of iPhone XR to prevent cannibalization of pricier models?

Apple held back launch of iPhone XR to prevent cannibalization of pricier models?
Last year, Apple released the iPhone 8 and iPhone 8 Plus in September and had to wait until November to launch the pricier iPhone X. The company faced issues receiving the latter device's OLED panels that were being used on an iPhone for the first time. This year, the release schedule is reversed with the two OLED models, the iPhone XS and the iPhone XS Max launching today, and the LCD sporting iPhone XR scheduled for release on October 26th.

Talk about a delay for the 6.1-inch iPhone started back in June when the device (then dubbed the "iPhone 9") had problems with the leakage of light around the notch area of the display. It would be easy to point to that problem as the reason for the staggered release dates, but according to a report in the Wall Street Journal, Apple delayed the iPhone XR for a completely different reason. The Journal cites sources familiar with Apple's production plan who claim that the delay has to do with pricing. Essentially, with the lower priced iPhone XR expected to outsell the other two 2018 models, the manufacturer was worried that the lower priced unit would cannibalize sales of the more expensive iPhone XS and iPhone XS Max. As a result, Apple staggered the release dates to give its higher priced phones nearly five weeks without competition from within.

Apple's stock seems to respond now to the average selling price (ASP) of iPhone units. Loup Ventures' Gene Munster says that the ASP for fiscal 2018 was $745. With the unweighted average price of all iPhones expected to be available in fiscal 2019 coming in at $765, according to Munster, the odds favor a higher iPhone ASP for Apple's new fiscal year that starts in October. By forcing early adopters to choose the iPhone XS ($999 for 64GB, $1,149 for 256GB, $1,349 for 512GB) or iPhone XS Max ($1,099 for 64GB, $1,249 for 256GB, $1,449 for 512GB), Apple is raising the ASP before the lower priced iPhone XR becomes available (64GB for $749, 128GB for $799, 256GB for $899). On Wall Street, the consensus is that Apple will hike the iPhone ASP by 6% during fiscal 2019.


Besides the ASP, Apple is said to be prioritizing the OLED models because they are more profitable. The iPhone XS and XS Max cost $355 and $371 to build, according to Susquehanna International Group analyst Mehdi Hosseini, who says that Apple spends $331 to build each iPhone XR. Apple has reportedly ordered 38 million iPhone XR units, 32 million iPhone XS Max handsets, and 13 million iPhone XS devices.

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32 Comments

1. Pcworld1976

Posts: 117; Member since: Sep 18, 2018

Surely yes

13. Atechguy0

Posts: 918; Member since: Aug 03, 2018

PhoneArena if it only cost $24 more to make the iPhone XS over the iPhone XR? So that means all that crap that you guys posted earlier (4 days ago) in regards to the cost of the OLED panels is a lie then. It was stated that it costs around $75. Last year it was mentioned that it costs $100 for the iPhone X OLED panel, or roughly 1/3 the cost of the iPhone X. You guys must be getting your information out of your butts. Look the XR display panel is a really cheap LCD, especially since it has a really low resolution display with a really low pixel density 326 dpi. Plus there is no 3D touch. The water resistance is lower on the XR. It's LTE modem is cheaper and slower. It has less ram. Only one camera, instead of two. Aluminum frame instead of stainless steel. The glass covering the iPhone XR is a lower grade than the XS. There is cheaper Android smartphones that you can purchase for less than the $331 cost that offer better specs and more features than Apple's iPhone XR. There is no way on this planet that it cost $331 to make an iPhone XR. Definitely not believable.

20. worldpeace

Posts: 3127; Member since: Apr 15, 2016

Phone parts are really cheap in OEM level, and it still can get lower when you buy it in bulk (or millions of units, like Apple did) iPhone X OLED cost $65.5 (https://www.millionairescore.com/actual-manufactu​ring-cost-apple-iphone-x/) I think XR is more comparable to iPhone 8 plus, which cost $290ish to make, and it's LCD cost ~$50, sure it have FHD res, but XR screen is bigger, both also have bigger battery than X and XS, I think both cost really similar. (But XR only have single main camera) I guess XR only cost around $300

30. Atechguy0

Posts: 918; Member since: Aug 03, 2018

BS it cost $50 for the XR LCD display. The iPhone 8 plus display if we use your LCD cost of ~$50. You forgot that it also has 3D touch as well for that $50. Even though it was less than $50. Because if the OLED displays were $65 to $70 like you said, then the better and more robust OLED displays that everyone already knows are superior to any LCD display that Apple has. The LCD displays are half or less than half. The OLEDs have HDR support and no HDR support for Apple's LCD displays. Besides others can do a websearch to see that you are full of it worldpeace. Apple's XR LCD display is a low resolution display with a low pixel density of only 326 dpi, and no 3D touch. It's a cheap LCD display, and it has no HDR support like the OLED displays, which also have 3D touch. Come on worldpeace you are trying to convince the world that the XR display is a good expensive display, but in reality it is not. It's a cheap LCD display. Get over it. Anyone who buys the XR is getting raked over the coals. Because it's not worth the asking price that Apple is asking. Btw the XR display is more comparable to the iPhone 8 display than the iPhone 8 plus display in terms of resolution.

31. strategic_developer

Posts: 1627; Member since: Jul 17, 2018

The XR is a 6.1" version of the 3.7" display on the iPhone 4. Same resolution and same pixel density.

2. Nomanbaloch

Posts: 1; Member since: Sep 21, 2018

Apple company needs money money and money, no customer care and nothing . We all know that apple is ripping us up but still we support apple.

10. Chris_ABN

Posts: 191; Member since: May 16, 2018

No YOU support Apple.

21. worldpeace

Posts: 3127; Member since: Apr 15, 2016

Wrong, they have customer care, its called "Apple Care" and you'll need to pay for it.

3. Derekjeter

Posts: 1466; Member since: Oct 27, 2011

I feel like any iPhone you get, you’re settling. There’s still many small things I wish my iPhone 7 Plus had. The Note 8 I’m using has one of the simplest features and Apple still can’t implement on this iPhone. When I get a call and I’m typing an email or watching a video, I don’t want the whole screen to be taken over by the call. I want that small window that will allow me to either answer or decline without stoping what I’m doing. How hard is that. It’s the small things that matter.

5. Venom

Posts: 3401; Member since: Dec 14, 2017

I agree. That's why I can't get back into ios. It's the simple things that are commonly used on Android that Apple lacks on the iPhone. Plus I hate the design of the iPhone X with the lack of TouchID.

24. Leo_MC

Posts: 7203; Member since: Dec 02, 2011

On a big device, unless the fp scanner is in the display, it's better to have face id.

18. gamehead unregistered

Apple just doesn't get it

25. Leo_MC

Posts: 7203; Member since: Dec 02, 2011

iOS could be better, but it's still ages before Android where it matters. I'm using them both (right now my daily driver is a Android vanilla device), and I see both the good stuff in Google's os but, man, there are so many bad stuff.

4. Jrod99

Posts: 713; Member since: Jan 15, 2016

Was there really any doubt this was the reason all along? 10 years of LCD and now some kind of issue? I like Apple products but they are about the profit margins.

12. Phullofphil

Posts: 1762; Member since: Feb 10, 2009

What company is not about the profits. You would be delusional if you could trust any company to have your best interest in mind. They make stuff you are going to by for as much as they can get from you.

26. Leo_MC

Posts: 7203; Member since: Dec 02, 2011

Yet Apple's profit margins are smaller than the ones in some android oems. Think about that next time you are talking about the prices this companies ask.

6. warrenellis93

Posts: 542; Member since: Jul 21, 2011

Apple is retated

7. cmdacos

Posts: 4099; Member since: Nov 01, 2016

#irony

19. gamehead unregistered

Lmfao

8. Humanoid

Posts: 1226; Member since: Dec 11, 2017

Apple is not dumb. They know Xr will be at least 60% of sales considering just 2018 devices. Also the fact they sell a lot during first 2 weeks. Now ppl have no choice but getting Xs or Max for now.

27. Leo_MC

Posts: 7203; Member since: Dec 02, 2011

Yes, they do: the choice to not buy a new phone until October. It's not like they can't use a 7 or a 5s for another month.

29. cocoy

Posts: 455; Member since: Oct 30, 2015

Yeah, I hate it as a customer but I have to admit that they have a good management decision. No wonder they've became a trillion dollar company.

9. redmd

Posts: 1926; Member since: Oct 26, 2011

Like everyone knows that.

11. Chris_ABN

Posts: 191; Member since: May 16, 2018

371$ to make a iPhone SMax! But you charge a pocket raping 1499!? I've never owned a Apple product and I never will. You can keep that trash.

14. CreeDiddy

Posts: 2146; Member since: Nov 04, 2011

So far XS Max is off the chain! Vibrant display, smooth animations, but most importantly the camera has to go down as the best. Puts the 7 Plus to shame. Front facer and portrait mode is incredible! Its getting closer to DLSR quality. I'm not kidding. My 7 Plus camera was average at best. I will be interested to review it in low light conditions. I see why Phil Schiller talked about the camera the entire time. It is a much better experience.

22. kanagadeepan

Posts: 1246; Member since: Jan 24, 2012

Yes... Yes... All those marketing words spoken on the stage must be really really true... /S

15. sunnyfpy

Posts: 277; Member since: May 12, 2013

Pricing rip off

16. cncrim

Posts: 1586; Member since: Aug 15, 2011

Sure Apple trying brain wash people, however she’s never force anyone buy Apple products. Majority people like to show off that’s why.

17. jibraihimi

Posts: 801; Member since: Nov 29, 2011

Wow PA, you figured this out......kudos to you guys, for understanding it so early.....

23. almostdone

Posts: 439; Member since: Sep 25, 2012

All trash. The Xr can't even play 1080p content in 2018. Doesn't even have at least a full HD screen. Apple herd are brain washed.

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