For years, Apple stuck to its 4" iPhone form factor as it watched Samsung and other companies release 5.5", 5.7" and even 6" phones. The large devices proved so popular that, eventually, Apple joined the race with its own 5"+ phone. Consumers -- using both hands, of course -- embraced the iPhone 6 series, making it Apple's most successful launch ever. Apple sold a record $74.5 million iPhones during the holiday season two years ago, raking in $74.6 billion in revenue and a record-breaking $18 billion in net profit. Those numbers shouldn't be surprising when the 2014 Apple iPhone models ranged between $900-$949 per unit.
But as Tim Cook mentioned at the company's last earnings call, the days of a roof-free iPhone business are over. Smartphone sales are slowing down in maturing markets while many in emerging markets simply can't afford much more than the basic Android device. If you were expecting Apple's new smartphone to compete with that, you would be as disappointed as some were the last time the company released a less expensive model.
But that doesn't mean there isn't opportunity to capture new consumers coming into new iPhone SE As the company mentioned, the $399 smartphone is designed to appeal both to Apple loyalists holding on to their older, smaller iPhones as well as newcomers looking for something a bit less expensive.
Apple newest iPhone comes in a compact aluminum design with a four-inch display. Unlike the plastic iPhone 5c, the casing has a a matte finish with chamfered edges that evoke the high-end iPhone 5 series. However, on the inside, it uses the same 64-bit A9 chip that is offered in the iPhone 6s and the iPhone 6s Plus. The A9 chip offers extremely fast performance, fast wireless service, the iSight camera with a 12-megapixel ability that features Live Photos, 4K video, and, of course, Touch ID complete with Apple Pay. And even better, complaints about the older phones' battery life have been addressed.
Apple has recaptured the allure of its smaller smartphone in an environment-friendly package that packs in nearly all of its latest platform technologies. That's important because Apple wants users and developers focused on the latest versions of its operating system and capabilities. For loyal iPhone users, that will represent a welcome upgrade. For switchers, it allows them to get the best of the platform as it stands today.