Apple Hides an Incremental Price Reduction in a Storage Increase

Apple announced many things at their annual later summer event at the circa 1915 Bill Graham Civic Auditorium in San Francisco today, including the iPhone 7, iPhone 7 Plus, the Apple Watch Series 2, and AirPods wireless earphones.

One of the least glamorous, but most important, changes was a doubling of storage for the latest iPhone, moving from the previous 16 GB/64 GB/128 GB to 32 GB/128 GB/256 GB. Later in the day, it became obvious that Apple had also moved to a minimum of 32 GB for both the iPad Air 2 and the iPad mini 4.

Some observations, in no particular order:

1) Along with many others, I have long believed that any iOS device being used for a full life cycle as a primary device should have at least 32 GB of storage. With these changes, Apple has lowered the minimum barrier to entry for a sufficiently configured iOS device by $100 for the iPhone 6S, 6S Plus, 7, and 7 Plus. In addition, the iPad Air 2 and the iPad mini 4 are now both $399 for 32 GB.

2) This indicates that Apple is at least aware of what has been at least somewhat of a "race to the bottom" going on in most other parts of the smartphone and "pure" tablet market. It also blunts at least somewhat the eternal calls by many for the ability to add storage via removable microSD card—something often available in Android-based devices.

3) Drops in the prices of the higher-end iPad Pros also make Apple’s offerings more price competitive when compared to lower-end configurations of Microsoft's Surface Pro 4. However, both products can still easily be configured to be as expensive as a capable traditional notebook—the iPad Pro tops out at $1,129 and that's before a keyboard or an Apple Pencil is added.

4) Finally, I believe the higher amount of standard storage in first-tier offerings is at least somewhat of admission that Apple doesn't believe that everything in a mobile user’s needs can be solved with their iCloud storage in the cloud—at least not in late 2016.

John Mulhern III, Posted 9/7/2016