I figure that there are three potential reasons for HTC and Samsung to release their flagships at a higher price than Apple’s iPhone 5, which starts at a subsidized price of $199 on most carriers and $99 on T-Mobile:
- The carriers won’t give them the same subsidies as they give Apple. Apple has significant leverage with carriers when it comes to subsidies – remember Sprint’s $20 billion deal with Apple to get the iPhone 5? Yeah, that was basically a giant preorder guaranteeing Apple a $500 subsidy per phone.
- HTC and Samsung are hoping that by offering bigger screens, more (gimmicky) features, and the general performance enhancements that come with being newer, they can charge more than Apple does and thus make higher margins.
- Expecting a bigger and more expensive iPhone later this year, they’re betting that they can raise the price of their flagship devices and still undercut Apple.
Edit: Well, fuck me. Turns out HTC is launching the One for $199.