Apple is poised to unveil the fourth generation of its budget-friendly iPhone SE later tonight, and industry analysts are already buzzing about what the tech giant might have in store. Counterpoint Research has offered key insights ahead of the launch, suggesting Apple is looking to inject new life into its entry-level offering to broaden its user base and boost service revenue.
The iPhone SE series has historically served as a crucial gateway into the Apple ecosystem. Its appeal lies in providing a more affordable entry point and a compact form factor, attracting users who prefer smaller devices without demanding top-of-the-line specifications. This has proven particularly successful in markets like Japan and within the prepaid segment in the US. By offering a lower-priced iPhone, Apple effectively expands its reach, driving growth in services like iCloud and Apple Music, and encouraging users to purchase accessories like AirPods and Apple Watches, ultimately maximising Customer Lifetime Value.
However, Counterpoint's Senior Analyst, Varun Mishra, notes a potential challenge. The SE’s contribution to overall iPhone sales has dwindled, accounting for just 1% in 2024. This decline signals a clear need for a significant refresh to reinvigorate the series and maintain its relevance in Apple’s portfolio.
iPhone SE 4: Expected Specifications and Upgrades
Leaks suggest the new model may have a larger display, the elimination of the Home button, and the introduction of Face ID replacing Touch ID, giving it a look similar to recent iPhone models. Reports also indicate that the device will be powered by Apple’s A18 chip, which could support Apple Intelligence, a suite of AI-powered features. There is speculation that it may include Apple’s first in-house cellular modem, potentially reducing its dependency on Qualcomm. The new iPhone SE is rumoured to feature a USB-C port instead of the traditional Lightning port, aligning with Apple’s shift towards universal charging standards, and might also include an Action button, currently found on the iPhone 15 Pro models and later. Some reports suggest that Apple might not use the iPhone SE branding; instead, it could be launched as the iPhone 16E, aligning it with the iPhone 16 series.
Leveraging Market Trends and User Behaviour
These predicted upgrades are strategically aligned with broader market trends and a deep understanding of Apple's user base, as highlighted by Counterpoint's recent smartphone survey spanning key markets like the US, UK, China, and India.
The survey reveals compelling insights into iPhone user behaviour, which directly inform the potential strategy behind the SE 4 refresh. One key finding is the difference in replacement cycles between Pro and non-Pro iPhone users. Pro iPhone users, often driven by "premiumisation" and a desire for the latest technology, tend to upgrade more frequently, holding onto their devices for an average of 2.75 years. Base iPhone users, however, exhibit a slightly longer replacement cycle of 3.15 years.
This suggests that the iPhone SE 4, traditionally positioned as a "base" model entry point, has an opportunity to capture users who are ready to upgrade from older iPhones, or even entice switchers from the Android ecosystem. The predicted upgrades, particularly the larger screen and enhanced performance, directly address areas where the current SE models might be perceived as lagging, making the SE 4 a more compelling upgrade option.
The success of the iPhone SE 4 could be crucial in maintaining Apple's momentum and further cementing its dominance in the global smartphone market. All eyes will be on tonight's launch to see if Apple delivers on these expectations and re-establishes the iPhone SE as a significant player in its overall iPhone strategy.