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TOKYO – Apple launched its low-cost iPhone SE last month, in a bid to gain market share from its Chinese rivals. Nikkei has analyzed the SE to discover how Apple has managed to develop this low-priced model that hits a lot above its weight.
Apple splurged on a core processor and some communication parts for the SE model, but other components, including its LCD and battery, are almost the same as its iPhone 8. The iPhone SE can be said to be “an equipped family car with a supercar engine, “as the company changes its strategy to focus exclusively on selling high-end models.
Tokyo-based research company Fomalhaut Techno Solutions conducted a teardown analysis of the iPhone SE against rival models and found the SE to be a bargain.
“The iPhone SE has almost the same exterior, dash and screen as the iPhone 8,” said director Minatake Kashio.
The component costs for a 64-gigabyte SE are estimated by Fomalhaut to be $ 217, or 18% lower than the iPhone 8.
How did Apple find those cost savings? The key is on the screen. The iPhone SE has a 4.7-inch LCD panel, which is the same size and resolution as the iPhone 6 released in 2014. That’s a stark contrast to Chinese manufacturers, including Huawei Technologies and Oppo, which have been using organic light. emitting diode panels even on low-cost smartphones.
Additionally, the iPhone SE has a battery capacity of approximately 1,800 milliamps per hour, as it relates to battery life. Comparisons cannot be easily made as battery life varies across other parts and operating systems, but rivals generally mount batteries of at least 3,000 mAh. Apple adopted batteries of the same class in its main iPhone 11 series released last year.
The iPhone SE allows users to view up to 13 hours of video on a single charge, shorter than the iPhone 11’s 17 hours, according to Apple.
The company has also cut camera costs. The iPhone SE does not have composite eye cameras, which are generally found in rival models. These cameras behave like the eyes of bees and other insects and offer almost infinite depth of field, providing high-quality images.
The SE’s image sensors, which affect image quality, are slightly smaller than those of the iPhone 11’s main camera, and are roughly the same size as those of the iPhone 8.
While the iPhone SE has better camera features, including blur when shooting people, the company has done this with image-processing technology instead of camera components.
But there are some areas in which Apple did not compromise. The iPhone SE carries the latest generation A13 processing chips, the same as those used in the iPhone 11 series, unlike rival models that are more likely to adopt cheaper processors in low-cost smartphones.
High-performance processors are the key components that AI and augmented reality achieve, areas that Apple has focused on.
Apple is also focusing on expanding its service businesses, including application distribution. You are trying to increase your customer base by supplying high-performance processors, which allow complex applications to run smoothly, at a low price.
In the wake of these cost-cutting efforts, the selling price of the iPhone SE starts at $ 399, around $ 421 in Japan, a significant drop compared to the $ 699 that both the iPhone 8 and iPhone 11 initially sold.
Faced with competition from Chinese rivals such as Huawei Technologies, the iPhone SE is crucial to Apple’s bid to regain lost ground in the global market. (Photo by Ken Kobayashi)
According to Fomalhaut’s estimates, the cost rate of the iPhone SE is 54%, compared to the cost rates of the iPhone 8 and iPhone 11 of 38% and 48%, respectively.
The low-end models of Chinese smartphone manufacturers are completely different from the iPhone SE. The Huawei P30 lite, which actually has a retail price of around $ 282 in Japan, including tax, is equipped with a three-lens camera on its back.
The Oppo Reno A, whose 64-gigabyte storage capacity model sells for just under $ 376 in Japan, including tax, features a 6.4-inch big-screen display, among other things. The P30 lite and Reno A are inferior to the iconic models of Chinese companies in terms of computing power.
According to US research firm IDC, Apple accounted for 13.9% of global smartphone shipments in volume terms in 2019, 1 percentage point less than in 2018.
Faced with increased competition from Chinese rivals, who have a competitive advantage in low-cost smartphones, and worsening consumer sentiment amid the new coronavirus pandemic, the iPhone SE is crucial to Apple’s gamble for regaining some lost ground in the global smartphone market.
But some Apple vendors expressed concern. “It doesn’t make sense if high-end models lose ground to the less profitable iPhone SE and don’t sell well,” said an executive at a parts maker.
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