iPhone 6 orders might cause Android devices to become more expensive
Rumor has it that Apple ordered between 70 million and 80 million iPhone 6 units in preparation for the device’s release, which should be somewhere around September. Some might say that this is a little over the top, but I think that not only will people buy all the units in record time, but Apple will probably have to order some more to satisfy the demand. The handset is the most highly anticipated iPhone ever according to several surveys and will surely sell like hotcakes. That being said, the massive amount of units ordered by Apple could actually have a negative impact on several other companies.
One generally assumes that competition is good for the market and we tend to agree for the most part. However, in this particular case we could see a price increase of up to %10 for competitive smartphones because of the iPhone 6. Usually the exact opposite would be true, but this record number of orders is leaving contract manufacturers such as Foxconn, Pegatron, and Winstron unwilling to produce devices for other companies at the same price. The simple explanation would be that because the iPhone 6 is taking up too many assembly lines, there are fewer left to manufacture handsets for companies such as Nokia, Sony, Motorola, and others, which all depend on them. Thus, the manufacturers are bumping up the costs quite a bit for other clients and are basically taking advantage of the situation.
Naturally, these companies still need the OEMs so they will probably be willing to pay a little more. In turn, they will presumably raise the costs of their devices at retail in an attempt to compensate for the losses. The Chinese publication UDN suggests that we’ll be seeing a price increase of 5% to 10% on iPhone 6 competitors. So the device will actually end up selling much better than anticipated thanks to the fact that Apple ordered so many of them. This is certainly an unprecedented situation and we’re very curios to see how it’s going to play out. Maybe the Original Equipment Manufacturers (OEMs) will not end up charging companies more, but this is highly unlikely I think.
The iPhone 6 is rumored to come in two variants, one packing a 4.7-inch display while the other will feature a 5.5-inch screen. The smaller one will presumably be released in September with the bigger version to arrive sometime later this year or maybe even in early 2015. Stay tuned for more news and updates.
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