Every two years, we buy a smartphone. At least, that’s what we’ve been told is reasonable to expect of the Average Person. And while reality means that this figure varies widely between any given two people, we do know that the companies that make and sell smartphones have this expectation. That, once a smartphone is two years old, most people are probably ready to get rid of it for something better. But there’s a wrinkle: everything we know tells us that’s changing.
In the early days of the iPhone - when it was exclusive to AT&T - the carrier’s upgrade policy allowed you to buy a new device every two years at a substantial discount in exchange for locking yourself into another two years of service. And when the iPhone began to make its way to other carriers with those same upgrade policies, so too did the tendency to upgrade. Apple very intentionally rode this wave, and still largely does: every two years, a major iteration of the iPhone is released - the naming scheme is literally built around making it obvious. Apple and the carriers created a sort of profit symbiosis this way - contract and upgrade, upgrade and contract - and many consumers seemed all too happy to participate.
The reasons behind that participation are likely myriad as they are subject to unhelpful generalization. Be it phone as a status symbol, planned technical obsolescence, or simply America’s brainwashed brand of consumerism. But none of these are especially good insights operating on such a broad level, as any given person’s reason behind upgrading a phone is likely to be exceptionally subjective and oddly specific. (For example: my dad finally upgraded his old phone because he claims that, after an update, it wouldn’t make a sound when someone texted him. My point is, don’t bring logic into this.)
Because there never was a particularly strong reasoning behind the two-year cycle in the first place, it’s begun breaking down. Both of my parents kept their last smartphones well over three years, and I have friends and acquaintances outside of the tech industry (which tends to be an upgrade-obsessed bubble) who’ve had them even longer. There’s no trend here I’ve noticed as regards age, occupation, or even necessarily income. And while this is all anecdote, what I do notice is that, for all the complaints we all have about our phones, most people I know seem to have come to accept frustration and inadequacy as part of the smartphone ownership experience. That is, even a brand-new phone will fail to do the things you want in the way you want, and that’s simply how phones are.
The Pixel 3 XL broke new ground for Google at $900. Expect prices for future models to keep creeping - or jumping - up.
I think this realization has begun to very much sink in with consumers on a broader level, and they’re increasingly disillusioned with companies that tell them the same story over and over: about a new phone does all the same things their old one does, but so much better. This has been exacerbated by the fact that every phonemaker’s advances are becoming increasingly incremental, creating ever more incentive to showboat, exaggerate, and over-promise about improvements. Take digital assistants. While there’s no doubt that virtual voice assistants demonstrate incredible advances in the technical and practical capabilities of AI and machine learning, they are also the frequent butt of jokes in pop culture. Even my mom understands Siri first and foremost as something worthy of mockery, second as a helpful tool.
But smartphone makers have increasingly demanded that we lean into these next-generation experiences and features in order to make the most of the technology in our pockets. Yet, I think that the more we take these companies at their word on the usefulness of their innovations, the more we are likely to be disappointed. No matter what Google says, my phone can’t magically eliminate motion blur from a photo taken in a darkened bar on a tipsy New Years Eve. A ‘power save’ button won’t make that last 15% of my battery last meaningfully longer if I actually want to use my phone. 5G isn’t going to get me reception on an airplane. And nobody has cracked the code on cracked screens, which remain a cringe-inducing epidemic (just ride public transit and look around - a packed bus is basically a phone trauma ward).
This is my snarky way of saying that many of the smartphone’s core problems and pain points remain unresolved, and as increasing numbers of us are coming up on a decade as owners of these products, our experience is teaching us things. One of those things is that upgrading doesn’t solve all the problems we think it does (even if it does solve some of them). And given the rising cost of phones - it is not unreasonably to think you’ll spend over a thousand dollars on your next one - this is likely ever more justification to hold off another year on the next big thing.
I’m not just musing in a vacuum, either: carriers are starting to respond to this. Perhaps the most price-sensitive of the four major operators, T-Mobile now sells some particularly expensive handsets on 36-month payment plans, with no 24-month option at all. While I personally find the idea of financing a phone for three years absurd, T-Mobile is clearly making a bet here: that customers would prefer a lower monthly bill to more frequent upgrades. Remember, your carrier has no big incentive to sell you a phone every two years as opposed to every three - locking you in for three years is actually far preferable, since their profit is all in the service. And if T-Mobile’s new financing proves a hit with customers, you can bet other carriers will follow.
OnePlus' new McLaren 6T is $700 - more than twice the cost of a OnePlus One four years ago.
So will the annual smartphone release cycle remain sustainable if we buy phones less frequently? For now, almost certainly: even in a saturated market, phones sell in quantities that make yearly upgrades completely worthwhile for manufacturers, especially in such a cutthroat space where keeping up with competitors is a necessity. But this will all serve to keep driving up prices (compound this with 5G, which is sure to drive them further), as sales growth declines and the average lifespan of a phone lengthens. Think of it this way: if Apple’s business is premised on making $500 a year from each iPhone customer, they’re going to make it happen - whether they’re buying every two years or every three. And I think that means we’re still a long way from peak smartphone sticker shock. $1000 phones? Try $2000 - just wait, it’s going to happen.