iPhone upgrade cycle reaches all-time high, alarming for Apple
Back in the carrier subsidy days and operator contracts, people were upgrading their phones if not yearly, they probably did it every two years, at the end of their contracts. That number has slowly started increasing on a global scale due to smartphones being more and more expensive. Adding to that the fact that carrier subsidies and contracts have changed, recent numbers showed people are upgrading every 2.6-2.7 years, according to a Gartner report.
In Apple’s case, in fiscal year 2018, iPhone owners upgraded their iPhones on average every three years, according to a CNBC report citing Bernstein analyst Toni Sacconaghi. He also predicts this number to go as high as 4 years in Apple’s fiscal 2019. Adding to the reasons above is Apple’s battery replacement program, which allows owners to extend the life of the iPhones.
This is not at all good news for Apple, and its outlook for the future. Sacconaghi predicts that only 16 percent of the iPhone install base — estimated at 900 million — will upgrade this year. He added that Apple’s fiscal 2020 “offering is unlikely to stimulate an acceleration in iPhone replacement cycles“.