The new iPhone 16e drew criticism because it costs 40% more than the handset it replaced, the budget-priced iPhone SE 3. Critics assume Apple cynically took away something lots of buyers wanted: a cheap iPhone. But actually, Apple couldn’t sell many of the low-cost model, according to industry analysts.
The newest offering, with significantly improved specs over the now-defunct iPhone SE 3, seems to be Apple’s attempt to make a low-end handset that more consumers will be interested in, even if the cost went up.
If you’re considering whether to buy Apple iPhone, you might want to see how the iPhone 16e compares to its predecessor.
iPhone SE 3: Not a success
It’s easy to assume that Apple’s cheapest models are the best selling, while only a few big-spenders go for the pricier variants. But that’s not the way it works at all. True, data from Counterpoint Research shows that the “basic” iPhone 15 model was the best selling handset in the world during Q3 of last year (the most recent quarter for which we have data), but the premiere iPhone 15 Pro Max was a close second. Sales of the budget-priced iPhone SE 3 were so low they didn’t even make the chart.
On Wednesday, Consumer Intelligence Research Partners revealed that the last SE model made up only 5% of Apple’s sales in 2024. It peaked in 2022 at 7%, the year the handset came out.
To put that in perspective, the iPhone 13 mini made up a mere 3% of Apple’s sales, which surely led to Cupertino dropping the tiny form factor.
In short, Apple didn’t cancel the SE line to force buyers to pay more for an iOS device. Instead, it got dropped because so few people were interested, even at $430.
An iPhone 17e, 18e, 19e?
The SE series was made up of moderately updated versions of older models. But the iPhone 16e follows a different strategy: it is based on one of Apple’s latest products, but with many noncritical features removed. And analysts at CIRP point out it could be the first of many.
“It appears that ‘e’ phones may be part of the program going forward,” said Michael Levin and Josh Lowitz. “Following the core iPhone 17 model launches in September, we expect Apple to announce an iPhone 17e around this time next year.”
Assuming the new variant gets an annual update, CIRP predicts “sustained market acceptance” for the latest addition to the Apple family.
A global trend toward premium smartphones
If anyone remains skeptical that people prefer pricier to cheaper iPhones, Counterpoint recently released research showing that the average selling price for iOS devices grew 25% over the last four years.
And it’s not only iPhone buyers. One quarter of smartphones bought globally in 2024 cost over $600. That’s up from 15% in 2015.
The cheap, bare-bones iPhone SE didn’t fit with the buying trend toward more premium products. But with its $599 price and better specs, the new 16e iPhone does fit. Apple’s simply trying to give customers what they want.
