One of the loudest rumors about the redesigned iPhone expected to launch this fall is that it could cost $1,000 or more.
But that price point doesn’t seem realistic, writes UBS analyst Steven Milunovich in a note distributed to clients on Tuesday.
Instead, he expects the redesigned iPhone, with a next-generation OLED screen, to start at $850 or $900.
He also expects Apple to launch two other models more similar to the iPhone 7 and iPhone 7 Plus at $650 and $750, close to their current price.
“Apple’s prices are consistent with a strategy we’ll call ‘mainstream luxury,'” he writes. “Entry-level products are positioned in the middle of the market and ‘Pro/Plus’ products sit at the high end. It’s a strategy that enables the Apple brand to be within the reach of a mass market yet be viewed as the premium option.”
Milunovich illustrates this point by comparing Apple laptop, phone, and tablet prices to other big electronics brands:
“Apple rarely ventures far above competitors at the high end. It is for this reason we do not expect to see a $1,000 iPhone,” Milunovich writes.