Apple started an experiment with low-cost models

Image source: Visual China

There was no offline press conference, and Apple put the new model on the shelves in the easiest way.

According to the configuration and pricing, the latest iPhone is not intended to meet the innovation expectations of the market, but more to test the waters of self-developed chips and use a lower threshold to make Apple Intelligence available to more people. This also makes its sales in China more dependent on the actual performance of AI features.

In the early morning of February 20, Beijing time, the iPhone 16e was unveiled on Apple's official website, and the accompanying promotion was a 13-minute introduction video featuring Tim Cook and Apple's vice president of iPhone product marketing, Kayan Delans.

In the video, Cook defines the iPhone 16e as "the last member of the iPhone 16 family" and the one with the lowest price. Apple did not follow the iPhone SE to name this cost-effective model, but for the first time used a number plus E as a suffix.

It's worth noting that, according to Counterpoint Research, when Apple first launched the iPhone SE in 2016, its sales accounted for 10% of total iPhone revenue, and this figure has slipped to around 1% in 2024. Therefore, changing the naming scheme may be seen as Apple's way of boosting sales of mid-range models.

According to the official website, the latest model of the iPhone 16e in terms of battery life, CPU and GPU performance is the iPhone SE 3rd generation released 3 years ago.

The new model is powered by the same A18 processor as the iPhone 16, but the GPU cores have been reduced from 5 to 4, which will affect performance, and comes standard with 8GB of RAM to meet the minimum requirements needed to run Apple Intelligence. Regarding this new feature, which has attracted much attention, Apple's official website in China specifically states that "the launch time is subject to regulatory approval." ”

The iPhone 16e opens up Apple Intelligence in China as a mid-range model, and this feature is reportedly expected to be launched in the Chinese market in the first half of this year. Compared with the cooperation with OpenAI in overseas markets, Apple is still in communication with Baidu on the development of AI functions while confirming its cooperation with Alibaba in the Chinese market, which shows that there are still many possibilities in the future.

In early February, Apple announced that it would host a developer event in Shanghai on March 25 titled "Harnessing the Power of Apple Intelligence." A wider audience will help build Apple's AI ecosystem.

Although it lacks highlights in terms of configuration, the launch of the iPhone 16e is also symbolic: Apple discontinued all models with a home button and fully switched to facial recognition; The iPhone 16e is equipped with an OLED screen, which replaces the LCD screen of the previous SE series. More importantly, Apple used its self-developed 5G baseband chip C1 for the first time to further get rid of its dependence on external suppliers represented by Qualcomm.

As a non-flagship model, the iPhone 16e carries low market expectations, whether it is to promote the large-scale implementation of Apple Intelligence, or to use it as the debut of Apple's self-developed 5G baseband chip C1, it is a less risky choice.

Apple has relied on Qualcomm chips for a long time in the past, and the launch of C1 marks to a certain extent that the technology company is moving away from its dependence on external supply chains and gradually realizing the independent and controllable chip ecosystem. However, whether the use of new core components can support the excellent performance of the equipment still needs to be observed in practical applications.

According to Apple, the C1 is "the most energy-efficient modem ever made for the iPhone, with fast and stable 5G cellular connectivity."

A Qualcomm spokesperson told Fortune in response to Apple's current and future business plans with Qualcomm: "The best commercial smartphones available today are equipped with Qualcomm's leading 5G Advanced modem and radio frequency system, which uses AI to optimize the fastest and highest capacity networks in each country. We will soon be showcasing the future of connectivity at Mobile World Congress in Barcelona. ”

In terms of price, the iPhone 16e marks the devolution of Apple Intelligence features to mid-range models. The iPhone 16e is priced from 4499 yuan (storage starts at 128GB). This price is subsidized by the state, and it can finally be bought for 3999 yuan, referring to the previous model sales, there is still room for discounts in the future.

Apple uses new phones to compete in China's mid-range market, dominated by vivo and Xiaomi, at low prices. With the iPhone 14 and iPhone SE off the shelves, the iPhone 16e with Apple Intelligence became the cheapest iPhone model on sale with the official price tag.

Pre-orders for the new model will be available for pre-order at 9 p.m. on February 21 in the Chinese market and will be released on February 28, with a special label saying "limited to six iPhone 16e per customer". This seems to reveal Apple's confidence in the sales of this model.

According to the IDC report, in 2024, China's smartphone market will stop the downward trend of the previous two years, with annual shipments of 286 million units, a year-on-year increase of 5.6%.

Among the mobile phone manufacturers, Apple will rank third with a market share of 15.6% in 2024, ranking behind vivo and Huawei, with a year-on-year decline of 5.4%. As Huawei's self-developed 5G chips alleviate supply problems, Huawei's shipments in 2024 will increase by 50.1% year-on-year, taking away the iPhone market with similar market positioning. The importance of winning back the Chinese market for Apple can be seen from Cook's frequent visits to China in 2024.

Ming-Chi Kuo, a well-known analyst, said, "The launch of the iPhone 16e will not only help reduce the impact of the off-season on shipments, but also promote the penetration rate of Apple Intelligence." He expects the iPhone 16e to ship about 12 million units in the first half of this year and 10 million units in the second half of the year, which will perform slightly better than the previous SE model. (Fortune Chinese Network)

At Fortune Plus, netizens have made many in-depth and thoughtful comments on this article. Let's take a look. You are also welcome to join us and talk about your ideas. Other hot topics today:

Check out the great insights from Musk's artificial intelligence company xAI to release Grok 3

Check out "Gree Electric Appliance Stores in Many Places Become "Dong Mingzhu's Healthy Home", Is It Happy or Sad? Wonderful point of view