How will iPhone 7 launch affect lineup pricing? Can SE go even cheaper?

Could the iPhone SE get even cheaper with the iPhone 7 launch?

When Apple launches a new iPhone, it usually maintains pricing for the top models as the previous generation models get price reductions and possibly discontinued. It typically bumps the oldest models out of production entirely, keeping four to five models for sale including the new flagships.

With the iPhone 6 and 6 Plus introduction, for example, Apple kept the iPhone 5s and an 8GB iPhone 5c around at reduced prices. With the iPhone 6s and 6s Plus, it discontinued the 5c and kept the 6/Plus, 6s/Plus, and 5s at reduced price points until ultimately replacing the 5s with the new 4-inch iPhone SE in March.

But this year there are some questions about what Apple will do with the iPhone lineup following the iPhone 7 launch this fall. Reports of increased storage options and a new “Pro line” for iPhone 7 could change Apple’s usual approach if true, not to mention the new iPhone SE, now the only 4-inch device in the lineup, was a rare mid-year iPhone release earlier this year. 

Can iPhone SE get even cheaper with iPhone 7 launch? Will Apple keep the iPhone 6 and 6 Plus around or discontinue those models while offering discounted 6s and 6s Plus models only?

Here’s what the current iPhone pricing looks like:

iPhone SE (16GB/64GB)

$399-$499

iPhone 6/Plus (16GB/64GB)

$549-$649

iPhone 6s/Plus (16GB/64GB/128GB)

From $649-$749

At $400-$500, I think the SE certainly fills a gap as far as having a lower priced iPhone for enterprise, education and markets that don’t need to have the latest and greatest with the iPhone 6 line. But what happens when iPhone 7 bumps iPhone 6s and 6 pricing closer to SE’s territory and the gap feature-wise widens with iPhone 7?

Currently the SE is only a slightly lower spec’d device compared to the flagship line. As Zac noted in his SE review, the device is no slouch in comparison to the iPhone 6s/6s Plus and mainly only lacks a few software features like 3D Touch. But with the iPhone 7, there will be a much bigger difference between the lone 4-inch, entry-level iPhone and the flagship line. 

If we follow Apple’s usual pattern, I’d assume the iPhone 7 replaces the 6s and 6s Plus at $649 and $749 starting prices, and those devices get usual discounted pricing to $549-$649. But if it keeps the iPhone 6 and or 6 Plus around at prices even lower than that, they’ll be getting real close to cutting into its SE market unless pricing for that device gets lower as well.

I think that will lead Apple to discontinue the 6/Plus entirely and keep SE pricing the same, or discount both the SE and the 6/Plus lines. Ben previously discussed the potential of a $299 iPhone around the time the SE launched, which is likely where the SE will end up this fall if Apple goes ahead with a price reduction on its starting price. 

32GB base, 256GB option, ‘Pro’ line

A few things to consider: Apple is said to be dropping the 16GB model for iPhone 7 and starting with a base 32GB model. There have also been rumors that the high-end devices in the lineup could come with 256GB storage up from 128GB. And at least a couple alleged leaks have referred to what could be a new “Pro” line for iPhone 7, with one alleged pricing leak claiming to show a Pro line carrying a $150 premium.

We’d hope that a bump up for storage capacity options won’t mean price increases to Apple’s normal iPhone pricing, but a ‘Pro’ line could potentially bring a new tier into Apple’s usual iPhone pricing if the rumors are true. 

A 4-inch iPhone 7 or iPhone SE 2?

Out of all the iPhone 7 rumors so far, not one has given much hope to the idea that Apple might introduce a 4-inch model to the lineup. Apple of course just reintroduced a line of 4-inch iPhones with the iPhone SE in March after making the switch to 4.7-inch and 5.5-inch displays on its flagship lineup for the couple years before it. That was a rare mid-year iPhone introduction too, and it seems possible Apple could keep that device on its own release cycle separate from the iPhone 7 as its lower-priced iPhone.

It could, however, also make some tweaks to pricing and possibly the device itself in time for fall– with new storage options for example– to make the SE fit in more with the rest of the lineup following iPhone 7. But it’s still unclear if Apple plans to ditch 16GB models for just iPhone 7, or possibly the SE and other devices too.