Apple has introduced the iPhone 16e, a new smartphone that brings advanced artificial intelligence (AI) capabilities at a more affordable price point than its flagship models.
The device is powered by the same A18 processor found in the premium iPhone 16 and offers similar storage options. However, it comes with fewer cameras and lower overall specifications. Priced at £599 in the UK—£200 less than the iPhone 16—the iPhone 16e is positioned to attract budget-conscious consumers while showcasing Apple’s latest advancements in AI technology.
Pre-orders open on February 21 in 59 countries, with the phone expected to be available in stores shortly after.
A New Approach to AI Integration
Apple has faced challenges in recent years as iPhone sales have slowed. With the iPhone 16e, the company hopes that integrating Apple Intelligence—its branded suite of AI features—will reignite consumer interest. The device includes tools for text generation, image editing, and enhanced searches within photo libraries. Additionally, Siri now incorporates OpenAI’s ChatGPT, expanding the virtual assistant’s capabilities.
Apple CEO Tim Cook highlighted the phone’s potential during the launch, emphasizing its performance, privacy features, and ability to help users “save time, get more done, and express themselves in new ways.”
Industry analyst Paolo Pescatore told BBC News that the lower-priced iPhone 16e could accelerate consumer adoption of AI, calling it “one of the most affordable powerful iPhones now on the market.”
However, not all experts are convinced of its impact. Cory Johnson, chief market strategist at Epistrophy Capital Research, pointed out that Apple has invested $189 billion (£150 billion) in AI over the last decade with limited success. “All we have to show for that is the HomePod and $3,500 ski goggles,” he remarked, referencing the slow sales of the Vision Pro headset.
Apple’s First In-House Modem
One notable feature of the iPhone 16e is its C1 modem, Apple’s first proprietary cellular modem. Previously, the company relied on chips from Qualcomm and Intel, often incurring high licensing fees and engaging in legal disputes. Developing its own modem aligns with Apple’s long-term goal of controlling more components within its devices.
Tech influencer Marques Brownlee highlighted the significance of the modem on social media, calling it the “most lowkey interesting thing” about the new phone.
Targeting New and Existing Customers
Analysts believe the iPhone 16e could help Apple expand its market share, particularly in price-sensitive regions like India, where high-end iPhones are beyond the reach of many consumers. Forrester principal analyst Dipanjan Chatterjee noted that the phone’s affordability could also attract first-time Apple users, introducing them to the company’s ecosystem of devices and services.
Apple is also targeting owners of older iPhone models. A comparison tool on its website shows how the 16e stacks up against models dating back to 2019, accompanied by the message: “There’s never been a better time to upgrade.”
With a competitive price, powerful AI features, and new hardware innovations, the iPhone 16e could play a key role in revitalizing Apple’s smartphone sales in the coming year.
