This story is part of Focal Point iPhone 2022, CNET’s collection of news, tips and advice about Apple’s hottest product.
When Apple executives show off the iPhone 14 in California next week, as expected, you probably won’t notice many changes to the phone. Rumors suggest that the notch housing the selfie camera may be smaller, and Apple will likely tout camera improvements or new always-on display technology. But the feature that the company will bet on the most to attract customers will be the one that was introduced two years ago: 5G wireless.
Sure, for some people, 5G is yesterday’s news. For others, it’s just a bigger number than the 4G that was there before. But data is mounting that 5G wireless is becoming almost as important to today’s iPhones as battery life and storage, the two features people consider when buying their phones . The current wireless standard, which has been available for several years on all major US carriers, is also the second most cited reason people told Deloitte researchers they switched providers of mobile telephony, behind “better value for money”.
That’s a far cry from how 5G was perceived at launch and in the early years, when the service was fired up with much fanfare but little real coverage. But carriers have invested billions of dollars in the infrastructure and airwaves to support it, resulting in better service in many places.
Apple CEO Tim Cook is one of the biggest drivers of 5G, citing it almost every time he talks about iPhone in public since he first offered the technology with the iPhone 12 in 2020. “The 5G has been an accelerator,” he said in July when discussing the future outlook for his company’s phone, despite rising inflation and a looming recession. “I think there are reasons to be optimistic.”
Read more: How to watch iPhone 14, Apple Watch Series 8 launch event
Every year seems to be a testament to the continued popularity of the iPhone, and that will continue with good reason this year as well. The iPhone is the company’s most important product by almost any measure. Apple racked up more than $191.97 billion in iPhone sales last year, which was more than half of its overall revenue. Much of the iPhone’s technology has also seeped into the rest of its business, with related products such as the Apple Watch, AirPods and the iPad tablet becoming multibillion-dollar businesses in their own right.
It has also helped boost Apple’s value to more than $2.5 trillion, up from the $60.7 trillion Wall Street valued the company at just before the device was first announced 15 years ago . Apple is now the most valuable company on the planet, followed by oil giant Saudi Aramco, Microsoft, Alphabet (Google), Amazon and electric car maker Tesla.
The general picture
The economy has become a key issue for many people since inflation began its rapid rise last year.
James Martin/CNET
This year, however, the iPhone’s success won’t just be a measure of sales adding to Apple’s profits. It will also be a benchmark for the wider economy, giving some sense of whether people are willing to spend at a time when our collective confidence in the economy has fallen to its lowest point in decades . Companies large and small have slowed new hires or started laying off staff, as Snap, Facebook’s smaller social media competitor, did last week.
Yet 5G, as yawn-worthy as it is within the tech industry, may be Apple’s key to success navigating the sour economy we all seem to be facing. Wedbush Securities estimates that about 240 million of the 1 billion iPhones in use worldwide have not been updated in the past three and a half years and therefore do not work on 5G networks.
Owners of older iPhones are likely to upgrade at some point, especially as wireless carriers offer perks like free subscription TV and movie services to entice people to upgrade. “The rigidity of the iPhone upgrade cycle is still being underestimated,” Wedbush analysts wrote in a note to investors earlier this summer. “This remains Apple’s unique advantage over other tech stalwarts.”
Dream a little dream with 5G
Although 5G wireless networks were available before Apple unveiled its first 5G-capable iPhone in 2020, many people saw it as one of the service’s biggest launches.
apple
One strange aspect of the 5G upgrade cycle may be that while people are shopping, they don’t want to buy new phones that aren’t 5G, with 73% of Deloitte survey respondents saying they want “better understanding” . of what 5G has to offer, and 30% said they are disappointed by “a perceived lack of innovative apps and services that take advantage of 5G.”
When carriers started touting 5G a few years ago, they talked about next-generation wireless technology that could usher in a new future full of sci-fi devices. The promise of 5G appeared everywhere, from self-driving cars to remote medical care and smart cities.
Read more: Everything we know so far about the iPhone 14
So far, 5G has largely delivered on its promises of higher speed and greater reliability, but that’s about it.
Meanwhile, carriers have convinced people that 5G is necessary in part by turning off older 3G service, effectively pushing some people to upgrade and indirectly warning 4G users that they will eventually be next.
Now, with economic uncertainty on the horizon, people need to think more carefully about purchasing devices they may not upgrade again for several years.
“If you’re going to buy a smartphone, you’re going to buy the best you can at a given price,” said Maribel Lopez, industry observer and head of Lopez Research. “People have to make some serious decisions when they’re looking at a 30% increase in food costs and a doubling of gas prices.”
“No one, unless you need a value phone, would buy a 4G phone today,” he added.
shiny apple
Apple achieved its highest ever profit sales after launching the iPhone 13 last year.
Lexy Savvides/CNET
All these trends do not mean that Apple’s iPhone is a guaranteed success, with or without an economic catastrophe in the making around the world.
To sweeten the presentation of the iPhone 14, Apple teams are working hard to deliver software updates with its iOS 16 software update, such as a new “widget” to add information to the lock screen, undo the ‘sending to the mail and greater security.
They’re also rumored to be polishing new features like always-on display, which would allow iPhones to show limited information on the screen even when it’s normally turned off, and emergency satellite text messages, which could come in handy if You are stranded on a desert road or in the middle of the ocean.
Read more: All the iPhone 14 features I want to see at Apple’s next event
To some people, these may all seem like unnecessary features just to have something new in the box this year. But Creative Strategies analyst Carolina Milanesi said Apple needs to be careful about introducing features that matter to early adopters and premium buyers, who are “critical to brand perception.”
“You can’t let that high-end user feel left out or forgotten,” he said. And for everyone else, expect carriers to offer subsidies and other freebies to convince people that the real big changes will be in the value they’ll get from the phone.