Apple has brought its artificial intelligence capabilities to its most affordable iPhone model, introducing an AI-powered iPhone 16e with a starting price of $599. The device features Apple Intelligence, which provides features like notification summaries and writing recommendations in English.
The new phone lacks a home button or Touch ID, instead relying on facial recognition system Face ID. This marks the first update to Apple’s lowest-priced smartphone line since 2022, replacing the iPhone SE.
Apple is introducing the new iPhone at a critical juncture for its business. Sales have been down by 2% from their peak in 2022, with the company citing limited availability of Apple Intelligence as a reason for decline. However, research suggests that A.I. hasn’t been a major factor in driving sales.
Instead, Apple is likely introducing the new iPhone to raise prices across its range and collect more revenue on each sale. The $599 price point is 40% higher than the last iPhone SE, which cost $429, resulting in an additional $170 per phone sold.
The availability of Apple Intelligence, however, is crucial for expanding sales overseas, particularly in China and India. In these markets, rivals like Huawei have gained ground on Apple’s market share. The new iPhone 16e introduces a custom-designed modem chip, the C1, which provides 5G connectivity and replaces Qualcomm’s modems.
While the new iPhone may not be as highly anticipated as previous releases, its introduction is seen as a strategic move for Apple to boost sales and expand its presence in key markets.
Source: https://www.nytimes.com/2025/02/19/business/apple-iphone-16e-ai.html