Business

The rise of the $1,000 smartphone

Versatility in new models can be costly

A guest shows the new Galaxy Note 8 smartphone during the launch event in New York City, U.S., August 23, 2017. REUTERS/Brendan McDermid
A guest shows the new Galaxy Note 8 smartphone during the launch event in New York City, U.S., August 23, 2017. REUTERS/Brendan McDermid

As another smartphone battle is in the works between Samsung and Apple this fall, there is a new wrinkle for the average smartphone customer to consider — prices that edge toward $1,000 for a new phone.

The Note 8, Samsung’s latest premium smartphone, starts at $940. For months, analysts have speculated that the 10th anniversary edition of the iPhone, which will debut at Apple’s rumored Sept. 12 event, could be even higher.

Even for smartphone customers used to paying $800 or $900 for a phone, the $1,000 mark may seem a bridge too far. For that, after all, you could easily get a pretty good laptop — a MacBook or Surface Laptop, for example.

What’s behind the price increases? Some of it is pure function, as these phones do more than even the standard iPhone or Galaxy models. In general, smartphones carry more technology than ever before.

While they aren’t yet laptop replacements, smartphones are required to do more than ever before as people rely on them for way more than Web browsing or phone calls. Making something versatile, portable and with enough battery life to endure being used every moment of the day isn’t cheap.

The smartphone-buying public also craves innovation from this latest batch of phones. And innovation is expensive. The Note 8’s 6.3-inch edge-to-edge screen is its main feature, and a costly one.

The same is true of Apple’s expected super-sharp OLED screen in the iPhone. The phone also could have new facial recognition technology and wireless charging, which all contributes to its bigger price jump.

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Another part of it, of course, is profit. Apple and Samsung basically are the only companies in the smartphone business that make any on their phones.

Both companies declined to comment.

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