Apple's New Battery Replacement Policy Could Hurt iPhone Sales Says Barclays
Apple has been in some very rough waters over the last several weeks after the realization that the company was throttling devices with older batteries. Apple naturally says that the throttling of the devices was in the name of what's best for consumers, but some aren't buying that response. To appease the angry mob of iPhone owners, Apple announced a new battery replacement program that drastically cut the price for battery replacement.
This was certainly the right move for consumers, but it could hurt the bottom line in Cupertino according to Barclays. Analyst Mark Moskowitz says that the new battery program offering $29 battery replacements, down from the previous $79 price, could be bad for iPhone sales.
Barclays said, "While this is a good PR move for Apple to resolve the issue, we are concerned it could be a mild headwind for iPhone unit sales if more iPhone users decide to take the offer instead of upgrading to a new device."
Moskowitz estimates that 77% of iPhone users are in the group that could see improvement in function by simply replacing the battery. He wrote, "In our base case scenario, 10% of those 519M users take the $29 offer, and around 30% of them decide not to buy a new iPhone this year. This means around 16M iPhone sales could be at risk, creating ~4% downside to our current revenue estimate for C2018."
The whole throttling of old iPhones saga started when Apple was forced to admit it slowed processing speed on some devices with degraded batteries. This was one way to maximize battery performance and prevented unexpected shutdowns according to Apple. A new battery will return the iPhone to maximum performance and speed up apps and software used on the phone.