The iPhone 8's biggest change will not be a 'must have' feature, analysts say
The iPhone 8, as some analysts call it, will use a new kind of screen technology called OLED that could be a top selling point for the phone. OLED screens can display more accurate colors, including darker blacks, and can theoretically use less battery.
But some analysts believe the OLED screen may not be a big enough difference to convince many consumers to upgrade.
Barclays analysts on Thursday said they "struggle to see the incremental benefits" that come with the upgrade to OLED screens from LED screens, which current iPhones use.
Barclays analyst Mark Moskowitz and team write:
"In terms of the year ahead, OLED displays continue to be top-of-mind for investors when contemplating form factor improvements that could drive a growth revival, particularly with the iPhone. With OLED, we struggle to see the incremental benefits visually that would inspire a customer to replace an adequately-performing device. While battery life could improve with OLED, our conversations with industry participants suggest that most consumers will not notice any major "must have" experience changes because of new OLED displays versus LCD. We think that this dynamic, if sustained, could limit the upside potential related to new OLED-based devices that likely sell for a premium, which could keep average selling prices from moving much higher."
Of course, Apple rarely uses pure technology to market its products and it's a master of creating demand through incremental improvements. But these analysts are suggesting the increase in screen quality alone will not be enough to get average iPhone users - who are increasingly holding onto older phones - to upgrade.could cost $1,200, a sharp increase from previous years.
Apple is also expected to introduce other features with the redesigned iPhone in addition to the new screen, such as wireless charging and new camera features.
In addition to the redesigned, OLED iPhone, Apple is believed to be planning to launch two other phones that are more affordable alongside the redesigned iPhone.
These two devices could look more similar to the iPhone 7 and 7 Plus, and they would probably remain close to them in price - closer to $700 than $1,000. According to KGI Securities, these phones will have LCD screens, which are abundant.
But the screen is still the centerpiece of a phone and perhaps its most important component. Apple moving to OLED screens for the iPhone - which is made in extreme volumes of 10s of millions per quarter - has reportedly created a shortage of the screens, which competing brands like Samsung include in their high-end phones too.
Last year, a top Foxconn executive called Apple's transition to OLED panels as a "crisis." Foxconn is assembling the OLED iPhone.
"We don't know whether Apple's OLED iPhones will be a hit, but if Apple doesn't walk down this path and transform itself, there will be no innovation. It is a crisis but it is also an opportunity," Sharp President Tai Jeng-Wu said.
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