Apple has unveiled a more advanced and pricier iteration of its most budget-friendly iPhone, aiming to broaden the appeal of its suite of artificial intelligence (AI) technologies. The company hopes these innovations will rejuvenate demand for its most profitable product line.
The iPhone 16e, introduced Wednesday, marks the fourth generation of a model designed to be significantly more affordable than Apple’s standard and premium iPhone offerings. Previous versions of this budget-friendly line were branded as the iPhone SE, with the last model released in 2022.
Similar to the higher-priced iPhone 16 lineup launched last September, the iPhone 16e features an upgraded computer chip capable of powering a range of AI-driven features. These include tools to automatically summarize text and audio, generate on-the-fly emojis, and enhance the capabilities of Apple’s virtual assistant, Siri. The device also boasts a more powerful battery and an improved camera.
All those upgrades will translate into a higher starting price for an iPhone 16e at $600, a 40% increase from $430 for the last iPhone SE. But iPhone 16e will be more affordable than the cheapest standard iPhone 16 at $800. The new phone will be available in stores Feb. 28, but can be pre-ordered beginning Friday.
“We’re so excited for iPhone 16e to complete the lineup as a powerful, more affordable option to bring the iPhone experience to even more people,” said Kaiann Drance, an Apple vice president responsible for promoting a device lineup that generates more than half of the company’s revenue.
However, Apple faces a delicate balancing act. While the company aims to attract a broader audience with a more affordable iPhone, it must also protect its profits from higher-priced models, according to Dipanjan Chatterjee, an analyst at Forrester Research.
“The problem with a lower-end product in a luxury portfolio is that you want it to be good but not so good as to cannibalize the crown jewels,” Chatterjee said.
The iPhone 16e represents Apple’s latest effort to expand its market reach while maintaining its premium brand image and profitability.
