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Why are phones so expensive?

Discussion in 'Mobile Phones & Tablets' started by Hodders, Jun 16, 2019.

  1. Hodders

    Mobster

    Joined: Oct 18, 2002

    Posts: 4,075

    Location: Aldbourne Wiltshire

    Recent phones life the OnePlus 7 Pro are lovely, but...

    £699 is a huge amount of money.

    For the same cost I can buy a halfway decent Asus gaming laptop, a 50" 4k Samsung TV.

    Why do they cost so much? Is it the r&d, the short model lifespan, the bill of materials?
     
  2. OspreyO

    Mobster

    Joined: Dec 12, 2006

    Posts: 3,116

    People will pay it. No other reason.
     
  3. Ixon

    Wise Guy

    Joined: Apr 30, 2003

    Posts: 1,104

    Location: Wigan

    Apple is one of the main reasons we seen smartphone prices rise dramatically in the past couple of years when the iPhone X launched with the £999 price tag, others followed suite with the pricing of flagships because the none teccy general public would probably think a £600 flagship Samsung was vastly inferior to a £999 iPhone.

    If Apple suddenly decided that this years iPhone 11 was priced at let say £700, everybody else would also sell their flagship's under £700.
     
  4. Royal Fleet

    Hitman

    Joined: Nov 21, 2007

    Posts: 799

    Location: Fleet, Hampshire

    I am not sure there is a simple pithy answer to that question.

    It is a combination of
    - People will pay it (early adopters)
    - People will pay it (show off value)
    - Huge R&D costs
    - You need cutting edge components to get that much power from something that size.

    Phone companies do a great job of persuading the population that they need the cutting edge phone when in reality very few people do. I bought my son a new Samsung S8 recently. It is a fantastically capable phone for a third of the cost of my latest model variant.
     
  5. Minstadave

    Capodecina

    Joined: Jan 8, 2004

    Posts: 24,268

    Location: Rutland

    Theres plenty of bargains out there if you dont mind staying away from Apple.

    Some cracking S10e/S10/S10+ deals from Three this week. Lots of impressive Xiaomi phones floating around with high end Snapdragon chipsets under £300.

    I picked up a Samsung A70 when they were doing the trade in and cashback deal and that cost me £200 for a phone with a massive battery and huge OLED display.

    I suspect we've largely reached "peak phone" so trying to find anything innovative is expensive.
     
  6. AndyCr15

    Sgarrista

    Joined: Apr 28, 2011

    Posts: 8,968

    Location: London, UK

    I would say it's not all that fair to compare top end to 'half way decent'. You can get a 'half way decent' phone for £200. Can you get a gaming laptop for that? How much is a top end gaming laptop or top end 4K Samsung TV?

    I would suggest it this. Most items, of any kind, as you get to the top end the price raises significantly. R&D costs are rolled in to this too as it's the R&D that usually get you to that top end.
     
  7. billysielu

    Capodecina

    Joined: Aug 9, 2009

    Posts: 11,136

    Location: Oxfordshire

    Prices will come down. People were willing to pay it when each upgrade was meaningful. Now upgrades are small people look more at the price. Same as CPUs.
     
  8. Hades

    Capodecina

    Joined: Oct 19, 2002

    Posts: 22,268

    Location: Surrey and London

    My last two phones have cost around £200 and do nearly everything these expensive phones do. To me it is throwing money down the toilet buying a top end phone. It used to be worth it back when there were massive leaps in technology. But for the last few years what do they offer?
     
  9. hyperseven

    Soldato

    Joined: May 1, 2013

    Posts: 6,036

    Location: M28

    Arent there all sortas of licencing/royalty fees involved?
     
  10. Rroff

    Man of Honour

    Joined: Oct 13, 2006

    Posts: 62,139

    This is the problem I have - my original Xperia X1 (the old one) was a big leap in technology and worth it at the time, same with my Note 1 but since then the premium seems to be mostly about style over substance and the top models have become expensive accessories rather than a technical benchmark.
     
  11. AndyCr15

    Sgarrista

    Joined: Apr 28, 2011

    Posts: 8,968

    Location: London, UK

    It's a bit like cars... and PC's... and TV's.... and pretty much anything. A £200 phone will do most of what a £900 will do, but if you want those extra bits (brighter screen, wireless charging, waterproof, more processing power, smaller bezels, better build quality/materials etc) then you pay for it. If you don't need/want them, then great, don't spend more!
     
  12. hardkore

    Mobster

    Joined: Mar 13, 2004

    Posts: 2,775

    Location: Norfolk

    In such a crowded marketplace companies have to advertise the hell out of their devices. Even with the dominance samsung, huawei and apple have, i bet the marketing budgets are in the millions for each phone release.

    That will certainly be a factor.
     
  13. edscdk

    Soldato

    Joined: Jul 17, 2008

    Posts: 6,579

    Obviously 699 is nit a huge sum or these devices would not sell in thiir millions.. Get a £15 phone if you cannot afford 699
     
  14. IvanDobskey

    Soldato

    Joined: Feb 2, 2010

    Posts: 7,427

    Location: East Midlands

    It's like with anything, you can get cheap ones and expensive ones. Just pick one in the price bracket you are happy with :)
     
  15. tom_e

    Man of Honour

    Joined: Dec 26, 2003

    Posts: 26,210

    Location: West mids

    It is and they will because it's not £699 it's £30-40 a month which suddenly becomes ok.
    Most people with top end phones don't buy them outright, if that was the only option then they'd sell no where near the volume they do currently.
     
  16. booyaka

    Capodecina

    Joined: Jan 19, 2006

    Posts: 12,419

    If you think £699 is expensive - take a look at Apple - £1449 for the top end phone - more than double the OP7 plus
     
  17. mulpsmebeauty

    Mobster

    Joined: Apr 25, 2007

    Posts: 3,251

    It's the way of the world. Mr X can't afford a 20 grand car until that nice man at the dealership tells him the payments are only £275 per month and suddenly Mr X finds himself locked in for 36 months. It's easy to disguise an inflated price by turning it into a monthly payment.
     
  18. Terminal_Boy

    Soldato

    Joined: Apr 13, 2013

    Posts: 6,383

    Location: La France

    It depends. All tech companies try to get as much IP as possible to minimise what royalties they pay. There’s a whole bunch of “horse-trading” involved between companies to reach agreements.

    Qualcomm is currently in the brown and smelly due to most of their IP being related to CDMA which is almost obsolete now and various phone manufacturers using other chipset suppliers.
     
  19. Terminal_Boy

    Soldato

    Joined: Apr 13, 2013

    Posts: 6,383

    Location: La France

    For Apple to make their usual 35% profit at £700, iPhone 11 would be iPhone 7SE.
     
  20. Shocky-FM

    Mobster

    Joined: Nov 13, 2005

    Posts: 3,392

    So long as people are willing to pay the price, it will continue to increase.

    My upper limit for a phone is £600, I'm not going to spend anymore.
     
    Last edited: Jun 17, 2019