The 5.4" iPhone 12 2020 price may pleasantly surprise

All members of the fall crop will be with OLED displays and 5nm Apple A14 processors, and will have 5G modem versions. The most interesting one, however, is the 5.4" iPhone 12. This would be a brand new form factor for Apple, sitting right smack between the 4.7" iPhone SE, and the 6.1" iPhone 12 models, but will offer powerful hardware in a package not that much larger than the SE.

There could be a big market for that newcomer but, above all, it will fill a market niche that Apple thinks needed to be filled. Will that turn out so? Well, as always, the answer to this question will largely hinge on the price.

Tucked in a Korean display industry interview are some revealing musing about the expected iPhone 12 price tag and how Apple plans to achieve it. Speaking with Mr. Lee Chung-hoon of UBI Research, Korean tech publication The Elec managed to obtain some much needed clarity over the distribution of the new OLED panels that will land in all Apple iPhones in the fall.

What Mr Lee's OLED research shop is predicting is a slump in iPhone sales due to the coronavirus situation, from about 200 million units per year, to 160 million in 2020. Considering that their will be four new iPhones with OLED screens this year, he expects half of the sales to be of handsets with this type of display, up from a quarter last year.

That makes 80 million OLED panels that will be shipped for Apple to put in iPhones mainly by Samsung, then by LG, and, if they manage to pull off the required quality and capacity, by China's BOE which so far is mainly working with local brands like Huawei or Xiaomi.

Last year, Samsung supplied Apple with about 48 million OLED screens, and its shipments are expected to increase with 10 to 15 million units in 2020. LG will pick up the slack with 12 to 15 million, predominantly for the cheaper iPhones and repairs, while if BOE makes it to the iPhone 12 supply chain, they may provide up to 8 million OLED panels.

One way to expand iPhone sales to previous levels, claims Mr Lee, is to introduce more OLED iPhones in the middle-priced category of about $750, and that's exactly what the 5.4" iPhone 12 is expected to achieve.

The way to lower its price would be with lowering part prices, and the display is one of the main component costs. Since panel makers rarely lower their prices, especially in the oligopoly of the OLED market, then another solution would be to discard the need for additional touch layers, according to Mr Lee. Samsung makes such integrated touch-in-panel screens, and dubs the technology Y-Octa, but, first, that makes Apple too dependent again, and, second its touch sensitivity requirements call for an extra layer to the OLED panel. 

In the case of the iPhone 11 Pro that extra layer adds 20% to the already expensive OLED display, whereas if the touch is integrated, it costs a fraction of the that price over the longer term of production, tips the UBI industry researcher. 

Thus, by utilizing this more cost-efficient display, and shrinking the screen size, Apple may have managed to fit into a $700-$750 starting price for the 5.4" iPhone 12, which apparently is harder to achieve with the 6" and above OLED panel phones with touch add-ons. 

This year, however, touch will apparently be integrated in all OLED iPhone 12 models, and their pricing may be as follows:

Take these with a grain of salt, based on one OLED industry researcher analysis of the display panel supply costs for Apple, as the team from Cupertino may always decide to add a 5G premium to the iPhone 12 family prices this year.