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There’s a certain marketing genius to Apple’s tiered pricing for flash storage on its iPhones and iPads. Since customers can’t add storage via a microSD card later, they have to decide in advance how much storage they need, and many of us are going to err on the side of safety, bumping our purchase up to a higher price-band.

Adding $100 or $200 to the price of an iDevice for maybe $5-10 worth of flash storage/controller capacity is an important source of income for Apple, and one of the reasons its margins are so high. Whatever the company makes on a 16GB device, if it can upsell you to a 32GB or 64GB (or even 128GB, in the case of the iPad), almost all of the premium charged on those beefier models is pure profit.

It’s not money Apple would give up lightly, but I do wonder whether it’s sustainable … 

Right now, only techies realize the true cost of flash storage. But the world is changing. Technology is a topic covered by the mainstream media on a daily basis, with countless features offering advice on what to buy and things you should know. Mass-market consumers are becoming better educated.

sandisk-64gb1

Ordinary people are buying an increasing number of devices that need SD or microSD cards, and they can see for themselves how little these cards cost. When they can see 64GB cards going for under $10, it can only be a matter of time before they start wondering why Apple expects them to pay an extra two hundred bucks if they choose a 64GB iPhone over a 16GB one.

This is not a trivial risk for the company. Apple is a much-loved brand. Despite being one of the largest corporations in the world, part of Steve Jobs’ marketing genius were those smiling appearances on stage where you almost felt like you had a personal relationship with him, like you were buying from a person rather than a faceless corporation.

cook

It’s an approach Apple has been careful to maintain, Tim Cook and other senior execs doing their best to emulate that personal touch during product launches. The company does other things, too, to make you feel like it’s all about caring for the customer. Commission-free sales staff, so you never feel pressured to buy. Free Genius Bar appointments, to help you with any issues you might face. A generous warranty policy designed to ensure that if you have a faulty product, you (usually) walk out of the store happy. All of these things contribute to the halo effect of the Apple brand every bit as much as the sleek designs.

Apple customers understand we’re paying a price premium for our products, sure. But we can see what we’re getting for our money: very good products that continue to function well for a long time, and which have a decent resale value when it’s time to upgrade. No-one minds that.

But if customers start to feel like Apple is taking advantage of them, that highly valuable consumer-friendly image is at risk. And the one thing Apple should fear more than sacrificing margin is tarnishing its brand.

flash

So, what should it do? I can see three possibilities.

First, it could maintain its existing tiers, but reduce the premiums on the beefier models. A $50 difference between tiers (see Google’s Nexus) may still be an expensive way for a customer to buy flash storage, but it would be a lot more palatable than $100. I don’t, though, expect Apple to do this.

In fact, if you buy a no-contract iPhone at Virgin Mobile USA, you can already see Apple’s pricing structure breaking down with their ever present discounts:

Screenshot 2014-05-01 10.32.34

Second, it could maintain the tier model and existing $100 bumps, but increase the amount of storage. So instead of 16/32/64GB, offer 32/64/128GB now, moving to 64/128/256GB down the road. This, I think, is the route Apple is most likely to take. We’ll still be paying a premium for that storage, but at least we’ll have specs that out-class the competition.

Finally, there is a more radical possibility. Not one I expect Apple to adopt in the short to medium-term, but one that may make sense longer-term: do away with the storage tiers altogether. Offer a decent amount (perhaps 32GB in today’s terms, 64GB soon), and couple it to more generous iCloud storage deals.

With high-speed net access becoming increasingly ubiquitous, there’s an argument for saying that on-board storage will grow less important. When iTunes Match gives us access to our entire music library in the cloud, with on-demand streaming, maybe it doesn’t matter so much how much music we have on-board. When documents can live on iCloud, maybe it isn’t important to have much space for them on our iPads.

Perhaps the whole question of how much flash storage we get for our money will be largely irrelevant, and the bigger focus will be on how much cloud storage we get. In which case, re-run the above arguments on Apple’s less-than-generous iCloud pricing …

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109 Responses to “Opinion: Can Apple maintain its $100 tier flash storage pricing for iPhones & iPads indefinitely?”

  1. I personally think, with Online Storage Cloud providers providing support for backup of photos, and media, the only concern would be for Appstorage, and Apple does provide an SD card extension, owning any of the range of devices would not matter.

    Just my thoughts!

    • Tallest Skil says:

      The problem with this is all ISPs are moving to bandwidth caps.

      • frankman91 says:

        Yeah I second that comment. Freaking data caps changed the way I use my phone completely. It makes you super aware when you are streaming any sort of media and kinda spoils the fun of Netflix on the train. I will always go for the largest capacity possible and lug my files with me when I can.

      • thejuanald says:

        I completely agree, cloud storage and music/movie streaming are wonderful things, but I took a road trip recently and used Spotify to basically stream the entire trip and I nearly hit my 6GB limit from that and a couple of Netflix movies for my girlfriend to watch while I was driving. Bandwidth caps are awful.

    • another issue arises with signal… basically if you have no data because you loose signal or you’re on airplane mode you have no access to your files. I much rather have things saved on the phone for offline (or airplane mode) use than streaming or fetching my data from cloud.

    • Harvey Lubin says:

      Cloud storage is a solution for some things, but not for internal storage.

      Although Apple is over-charging for internal storage ($100 for an additional 16GB, $200 for an additional 48GB), it is unfair to compare the NAND flash in the iPhone to an SD card.

      NAND flash storage can have transfer rates of 400MBps or more, while SD cards might be only about one tenth of that speed.

      It’s like comparing the price of a 500GB SSD to a 500GB HHD. The SSD is much faster than the HHD, so the price comparison if inequitable.

      Again, yes, Apple does overcharge for the additional storage… but not by the huge amount comparable to SD cards.

      • thejuanald says:

        While true, you can buy really high speed 64GB micro SD cards for like $50. They’ll never be as fast as NAND storage, but it’s plenty fast for storing music or pictures, or even 4K video on my Note 3.

      • Storage cards will also never happen because they require a complete, user accessible filesystem to work.

      • mpias3785 says:

        @Mr. Grey, Correct me if I’m wrong, but IIRC, Apple can’t support external storage devices because they sell both media and players. I believe that this started as a requirement the music industry insisted upon back in the early iPod/ITMS days.

        This is something I read long before the advent of the iPhone and conditions may have changed and/or I may have just have dreamed this.

    • driverbenji says:

      I agree with the others here, Cloud storage does nothing for that which you have on your phone. And using your data to pull everything off internet is not practical for most…you either use up your cell data amount or go over the amount where they throttle you.

      But, again, we need more storage, especially if we are going to use the built in camera!

  2. Tallest Skil says:

    1. Of course they can.

    2. Studies CONTINUE to show that people feel the $100+ for doubling storage is a good deal. That’s why it has worked for so long; that’s why it will continue to work.

    • Ben Lovejoy says:

      Could you post links to these studies? I’d be interested to read – thanks!

      • jpatel330 says:

        There is no such study.. Skil is just pro apple on everything. however, i think they are pushing the limits on charging $100 per memory bump. i think the way to sustain this in the long run would be to switch to 32GB, 64GB, and 128GB models starting with the iphone 6. I don’t think people would have much problem paying $100 more per memory bump then, espeically to the 128GB bump.

      • Another way of making the $100 pill easier to swallow, would be to double the difference in storage. So you’d have a 16gb, 64gb and 256gb iPhone or iPad. Or combine that with eliminating the 16gb and you’ve got 32gb, 128gb, 512gb. In reality 512gb of storage is ridiculous. They could however, opt for two models instead of three, one 32 or 64 and the other 128gb or 256gb. Or, hey instead of charging per doubling charge in 32gb increments and lower the tier difference – 32gb, no extra; 64gb $50 extra; 128gb, $150 more than the 32gb model. In all honestly though my favourite option would be to include 64gbs at the base price starting with the iPhone 6. Include 128gbs for the base price for the iPad (64gbs for the Mini). Maybe bring the iPod touch into this and include 32gb. Then you could charge $100, $150 or $200 to double your storage.

    • I would like to see these studies as I don’t know anyone who actually thinks that.

    • +1 for wanting to see those studies.

    • would like to see those studies too

    • thejuanald says:

      Ah there we go. I was feeling weird, agreeing with you up there. I’d love to see these studies, because they must be some of the most skewed things I’ll have ever read.

    • It pains me to agree with Tallest Trol but I’d argue the general high user satisfaction surveys of Apple customers do imply no issue with storage pricing model. The article, though, is about *future* opinions changing

  3. Increased storage is long overdue. 16GB devices are about as useful as a candybar phone 12 years ago. They should keep that model for emerging markets, get rid of the 8 all together. Start the base at 32GB, then 128GB and 256GB. You either need a lot of storage or you don’t, so skip the 64GB option. $100 to jump to 128 from 32 and another $100 to jump to 256.

    I’ll probably be skipping iPhone 6 if it doesn’t offer a 128GB option. And that’s still settling, because I’d much prefer 256GB.

    • Tallest Skil says:

      256 in a phone? Much less 128? You nuts? That’s not happening. I can’t see a situation in which it would EVER happen. It’s a PHONE. The only situation in which 256 would be needed is a dystopian future in which operating systems designers have forgone the idea that code has to be tight and magically ballooned it to 100 gigs.

      Tablets, on the other hand.

      • You can’t see a situation in which that would EVER happen? You haven’t put a lot of thought into it then. Although it’s way more than I can imagine using presently I am sure there are lots of people who would welcome that and also be willing to pay for it. Furthermore it has less to do with bloated code and more to do with the amount of photos, videos etc. that someone may want to store on their device.

      • Brian Victor says:

        Personally, I will *never* say no to more storage on any device so long as it doesn’t cost me too much extra and performance of the device doesn’t suffer for it. Believe me, I will find ways to use it! HD Movies alone gobble up 4 Gig each!

      • Jan Klaassen says:

        “It’s a phone”? How about all of those 1337″ phablets? I would say: “It’s a PHONE.”

      • mpias3785 says:

        They’re only called phones out of convenience. It’s a phone, camera, video recorder, computer, gaming device, media consumption and creation tool, GPS, and whatever else developers can imagine. Phones stopped being just phones when the first cameras were added. The more functions that are added, the more storage that is needed.

        Just looking at Geekbench scores, my 5s is roughly 10X faster than my first iBook and supports almost twice the amount of RAM, why not supply them with a lot more storage, especially when flash RAM is so cheap?

      • Tallest Skil says:

        >>why not supply them with a lot more storage,

        First of all, power requirements. Second, again, because you don’t need that space in a pocketable device unless it’s your only owned piece of technology. That’s not happening! You can’t operate out of just a phone.

      • thejuanald says:

        Power requirements? Come on, NAND storage is incredibly low power.

        You could never see a situation where a person would want to store 1080p (or 4K) video on their phone? or a situation where a person would want to have multiple 1080p (or higher) videos on their phone?

        You’re just being silly.

      • Tallest Skil says:

        >>Come on, NAND storage is incredibly low power.

        And when you’re dealing with tiny batteries, “incredibly low” doesn’t cut it.

      • “no one will ever need a pc with more the 64k” Bill Gates.

      • Tallest Skil says:

        Don’t tart out that old nonsense if you’re not prepared to back it up.

      • mpias3785 says:

        @Tallest Skil, What power requirements?! If this type of storage required power then flash drives would need batteries.

        I need the space. When I travel I carry a portable wireless device into which I plug a a portable 1TB drive which contains a subset of my video library so I don’t have to waste bandwidth, money or both by streaming. It would be simpler if the phone just had more storage.

        Just because you can’t imagine situations when high storage capacity would be advantageous, doesn’t mean that others can’t.

      • Tallest Skil says:

        >> If this type of storage required power then flash drives would need batteries.

        So… you’re insane, then? Do you not comprehend that USB drives get power FROM THE USB PORT WHEN THEY’RE PLUGGED IN?! My stars.

      • Your problem is thinking that phones are actually phones still.

        Nope, they’re a computer in your pocket.

      • mpias3785 says:

        @Tallest Skil, Insane? Depends on who you talk to. Been watching technology for a long time, though. Reading and writing requires power but the actual storage doesn’t. I don’t know if reading or writing to 1GB flash memory requires more power than reading or writing to 1TB of flash memory, but I suspect it’s insignificant. All you need is a couple of bytes added to the address. If there’s a hardware guru in the house, speak up!

        Either way, components are getting faster, more efficient and cheaper as time moves on. What’s the gripe with storage capacity keeping up? My first ramdisk was only 1MB, cost $400 and was battery backed by lead-acid cells. Technology marches on.

        Phones will eventually have terabytes of storage OR streaming data will be available everywhere, 24/7 with 99.99% reliability and either be free or seriously cheap. I think the terabytes will happen long before full, cheap, reliable coverage.

      • Tallest Skil says:

        >>but I suspect it’s insignificant.

        I suspect it isn’t, as Apple hasn’t implemented it.

        >>OR streaming data will be available everywhere, 24/7 with 99.99% reliability and either be free or seriously cheap.

        What fantasy world do you live in? The telecoms won’t give you uncapped, unthrottled data, much less 100% availability.

      • thejuanald says:

        I believe they use the exact same amount of power independent of size.

        https://www.micron.com/-/media/Documents/Products/Product%20Flyer/NOR_NAND_Flash_Guide_lo.pdf

        I just read everywhere I could about this and everything I see says power consumption differences between a 4GB NAND storage system and 512GB would be seconds at most.

      • If you start telling people that they don’t need or can’t use X, then you’ve already lost the argument.

        Everyone on the planet who uses this kind of product needs more storage than they have. Saying otherwise is a lie plain and simple. If you don’t need more than 16GB, you don’t need this kind of product.

        Why on earth would anyone use a 64GB flash card in their camera? To take a lot of high resolution photos.

        Why does anyone need a 120GB+ music player? To store a decent amount of songs.

        Why on earth would someone use a 128GB card in their video camera? To shoot a decent amount of high res video.

        Why do people need 1TB or more on their computers? Apps, games, documents, plus of course the above, video, photos and music.

        An iPhone is all these things and more. Maybe you like traveling everywhere you go with a ton of devices, portable drives and cables, but a lot of people don’t.

        I have multiple apps at the moment that take up more than 1GB each. One that takes up 6GB. TomTom takes up over 1GB for each edition (I only keep one installed). Offline Wikipedia takes up 6+GB compressed (I don’t always keep it installed because I’m low on storage).

        My music collection is much bigger than 128GB. Syncing specific albums takes time and thought/planning. As sensors get denser, photos get bigger. As it stands, even with moderate use, storage ors very quickly for photos. Video? Much faster still – and that’s recording, never mind downloading or pre-loading content.

        How many people like running a storage device at always near-full? Not me. So yeah, I could happily use 256GB on a “phone”

        And I could easily use another 12TB for my home network.

        Oh, and don’t forget that flash storage is calculated in base 10 and a crapload is already used by iOS and default apps. Being able to uninstall default apps would also be welcome, but that’s a whole other mess.

      • Tallest Skil says:

        >>Saying otherwise is a lie plain and simple.

        1. What you’ve said is patently false.
        2. I never said otherwise.

        >>Maybe you like traveling everywhere you go with a ton of devices, portable drives and cables, but a lot of people don’t.

        Maybe hundreds of millions of people don’t nee 128 gigabytes in a single go. Maybe it’s not maybe, either.

      • mpias3785 says:

        @Tallest Skil
        “>>OR streaming data will be available everywhere, 24/7 with 99.99% reliability and either be free or seriously cheap.”

        “What fantasy world do you live in? The telecoms won’t give you uncapped, unthrottled data, much less 100% availability.”

        My point exactly… If I can’t get unfettered access to my media, cheap, I’ll need to bring it with me, hence the need for as much storage as can fit in my phone.

        thejuanald and Bruno Fernandes (@Linkb8) beautifully made the rest of my argument for me so I’ll refrain from going there except to mention, AGAIN, that technology evolves. My first hard drive was 20MB and weighed 12 pounds including the case. I now have about 350,000 times as much connected to my laptop. Using the old technology that much storage would weigh 4.2 million pounds and would need its own substation just to spin the disks.

        When talking about technology, never say never.

      • I agree there is no need for it, but if you can sell someone an extra $100 add on – without ruining the user experience by draining the battery too quickly – why not? I’d like to see Apple offer 64GBs with their base model, and 128GBs for $100 for the fools who’ll buy it. (And by that I mean those who think they need to store their entire digital HD movie collection on their phone, for all of the unpredictable 90min waits they have) Two storage tiers. Cut and dry.

        They could do the same with the iPad but bumping storage to 128GBs to start and 256GBs for $100 more.

      • thejuanald says:

        Tallest Skil make a habit of ignoring people when he’s proven wrong. I’ve done a few times now with references (including in this very thread) and he just ignores it. He’ll pipe up when he thinks he’s right, but if proven wrong, he will slink away without so much as an acknowledgement that his condescending remarks were, in fact, wrong.

      • thejuanald says:

        Awww, how cute. Someone’s offended that I proved him wrong and he has no comeback. Way to forfeit that argument by having to resort to childish insults, just like every other one we get into.

      • Tallest Skil says:

        Says the psychologically insecure Android user, incapable of posting on an appropriate website for his tastes.

        Enjoy, kiddo. No one buys your dreck.

      • kobymac says:

        I know apple haven’t even hot full HD yet, but competitors are hitting 2k screens and likely 4k in the next couple of years. Those movies ain’t that small. Also every android flagship (and maybe iPhone e 6) can shoot 4k video. But in 2019 when apple provides more affordable options for storage, android users will once again role their eyes and say – “yep, we’ve had it for years”. It is OK to enjoy the best tech available now, you dont have to wait for an apple stamp on the back of the device. Be an individual, not a follower.

      • Tallest Skil says:

        >>but competitors are hitting 2k screens and likely 4k in the next couple of years.

        Yeah, not on phones. Nor will Apple ever, as they’re not morons.

        >>It is OK to enjoy the best tech available now,

        And how is unnecessary storage that saps battery the “best tech available”?

        >>Be an individual, not a follower.

        Don’t whine for useless gimmicks, educate yourself on the technology at hand and hope for the best of every field.

      • thejuanald says:

        “>>but competitors are hitting 2k screens and likely 4k in the next couple of years.

        Yeah, not on phones. Nor will Apple ever, as they’re not morons.”

        Well, they’ll be left in the dust. They would be stupid not to go HD, seeing as others are already way ahead of them: http://www.techradar.com/us/news/phone-and-communications/mobile-phones/samsung-is-reportedly-upgrading-smartphone-screens-to-2k-and-4k-1219618

        “>>It is OK to enjoy the best tech available now,

        And how is unnecessary storage that saps battery the “best tech available”?”

        Just so you know, I proved you wrong in this very thread, with references. Extra storage does NOT sap battery power. But please, continue making yourself look as stupid as you are.

        “Says the psychologically insecure Android user, incapable of posting on an appropriate website for his tastes.

        Enjoy, kiddo. No one buys your dreck.”

        That’s great because I’m not selling anything. I’m just stating the truth with references. You seem to be the liar who is trying to sell people on something. If not, then please, I beg of you, prove me wrong. I, unlike you, admit I’m wrong if I am.

        You miserable troll.

      • Tallest Skil says:

        >>They would be stupid not to go HD

        No real disagreement here.

        >>seeing as others are already way ahead of them:

        lol, no.

        >>Just so you know, I proved you wrong in this very thread, with references

        Nope, but keep living the dream, son.

      • thejuanald says:

        How did I not prove you wrong about your absurd idea that more NAND storage will drain the battery further? I posted an article from a reputable source that makes your idiotic claim look just as idiotic as you. The fact of the matter is, there is no distinguishable difference in battery usage when using anywhere up to 512GB of NAND storage. You’re wrong. Please, go back and read rather than just spew diarrhea out of your mouth.

        This is just like that other article where you swore a person couldn’t reach from one side to another on a 5.5″ screen and thus couldn’t use such a phone one handed, calling anyone who disagreed with you a moron, an imbecile, etc. I then posted a photo of me using a 5.7″ phone one handed and you mysteriously disappear.

      • Tallest Skil says:

        Again, enjoy that fantasy world in which you live. If you want to pretend that larger chips don’t require more power when that’s patently false to anyone with even a modicum of comprehension about the physics of the matter, that’s your problem.

        Page 30, troll, and shut up: http://www.cs.virginia.edu/~vm9u/files/Master's%20Thesis.pdf

        Page 5, troll, and shut up: http://cmrr-star.ucsd.edu/starpapers/309-Grupp-1.pdf

        To the rest, which you either never posted or posted incorrectly, I suppose I have to express pity for your freakishly disproportionate hands (or express admiration for your success as a 7’2” basketball player?) or something.

      • thejuanald says:

        “Again, enjoy that fantasy world in which you live. If you want to pretend that larger chips don’t require more power when that’s patently false to anyone with even a modicum of comprehension about the physics of the matter, that’s your problem.”

        I didn’t mean to insinuate they don’t require more power, I meant to say that the effect on the battery would be minuscule and unnoticeable. Which is what I said in my original posts. My apologies if I didn’t clarify myself well.

        “Page 30, troll, and shut up: http://www.cs.virginia.edu/~vm9u/files/Master's%20Thesis.pdf

        Page 30, Figure 4.1 shows a difference of 0.6 uJ. That’s miniscule. I will read the rest when I get home, but that’s not saying much. Plus, this is using old technology.

        “Page 5, troll, and shut up: http://cmrr-star.ucsd.edu/starpapers/309-Grupp-1.pdf

        Table 3 shows small differences, again. I will have to finish the article when I get home.

        But thank you, for actually trying to prove your point, even though you continually (and unnecessarily) act like an ass.

        I will post a better response when I’m not on my phone when I have a chance to go through it.

        “To the rest, which you either never posted or posted incorrectly, I suppose I have to express pity for your freakishly disproportionate hands (or express admiration for your success as a 7’2” basketball player?) or something.”

        Here was the article in question: http://9to5mac.com/2014/04/24/poll-if-the-rumors-are-true-will-you-buy-the-4-7-inch-or-5-5-inch-iphone-6/

        And here’s me being able to type easily with one hand: http://i59.tinypic.com/2mgr4td.jpg

        I’m pretty sure my hands aren’t freakish, maybe you’re holding it wrong?

    • I don’t want to say this currently actually, but… I am a techie, a developer, a gamer and I’m totally fine with the 16 GB version of both my iPhone and my iPad. Do you really need so much storage on a smartphone? At the end of the day, it is just that. What takes so much space on your phone?… I can, though, understand thet with the 8 GB version. THat’s seriously too small.

      • Brian Victor says:

        It comes down to limiting your options. I am the kind of guy who likes to have his entire library or apps, movies, and music available whenever I go. Sadly, my 32 GB phone won’t hold more than a fraction of my movies or music.

      • Ry L says:

        Well, as a fellow iOS gamer, I have a 32GB phone and between all the games I have on it (several of them more than 1GB each) and photos/videos/etc I’m alwasy running out of room. It’s mainly the games. i don’t have room for all the apps I want on my phone. My iPad is 16GB and that’s even worse because I’d rather play games on the bigger screen and I can only fit a few games on there at a time. First world pain, but still. I’d be nice to fit everything.

      • mpias3785 says:

        I have a 64GB iPhone and just my music library consumes half. I have to cherry pick my audiobooks, videos and apps just to leave a bit of room in case I want to take some pictures and videos.

        I couldn’t possibly live in only 16GB.

      • It’s really a maintenance issue for me. As it stands I use my iPhone as my iPod. A small selection of my music library – downgraded to 128 kbps is still 4gb! That’s 1/4 of my storage. So I find myself needing to constantly changing out the music on my iPhone – since I don’t subscribe to iTunes Match. There are times as well where I will be taking photos or video and then I’ll get a message that I’m out of space – this happens because the last thing I want to constantly be doing is backing up all of my photos on my computer and deleting all of them from my phone. Not to mention the absolutely worst part of iOS and worst decision Apple has ever made – the constant interruption of the “You’re close to filling your phone’s storage.” message! Like, wtf? If the amount of room remaining isn’t preventing me from doing something then why the hell are you constantly bothering me! I’d pay $100 to never see that warning again.

    • Jan Klaassen says:

      I was even surprised when Apple kept 16/32/64 with the iPhone 5 and 5s. I expected they would move to 32/64/128 after the iPhone 4s. I would never buy 16 GB. I always buy 64 GB. I’ve got almost no apps installed, no music at all on my phone, but I use all space for pictures and videos I take. It’s completely normal for me to take videos (of the landscape or just the experience of driving through rivers and deep snow) of half an hour while driving around the country. Those videos are really big, so the phone fills up really quickly.

      Even if you don’t take such long videos I can’t believe how 16 GB is enough. I know there’s the cloud, but this doesn’t mean your device is only streaming from the cloud while not storing anything on your device. It will still maintain local copies of many files you stream. I don’t see the cloud as a solution for local storage, but as a convenient way of syncing and backing up. I use iCloud, because it’s so convenient. I know it automatically makes back-ups when I recharge my phone, so if I buy a new iPhone I can just log on with my iCloud account and all my messages, contacts, et cetera will be restored. I also like it when I have to call a shop I can just visit their website on my Mac to look up their phone number, I add this number to the Contacts app on my Mac, all of this while my iPhone is still in my pocket and the next day when I have to call them I just open the Contacts app on my iPhone and the number of the shop is there, because it synced through iCloud. That’s the reason I use iCloud, not to save local storage. Just buying enough storage is the way to go for me.

      By the way, I also think you can’t compare those cheap SD cards of a few Dollars to the storage used in an iPhone. I expect the components in an iPhone to be much better, faster and more expensive.

  4. I don’t know if i see this happening for the iPhone 6. They just released an 8Gb 5c in other countries recently so their plans to offer more storage for less doesn’t seem to be in the ballpark….yet. I for one do think that 32Gb should be the minimum for the $200 level. You are paying a premium price and you should receive a premium product with adequate local storage. Flash storage goes down every day and apple hasn’t dropped its prices at all. Think apple is just being plain greedy with these prices for so little.

  5. Isn’t that the truth. I think Ben is right though in saying that onboard storage will become less of of a factor in the future. However that is a few years off, in the meantime I would agree that Apple need to increase the baseline storage from 16/32/64GB to 32/63/128GB.

    • vmax says:

      Of course it matters. You can’t store your apps on the cloud. With sand boxing, for instance, each Microsoft Office app will need to have duplicated sets of frameworks and fonts. What a waste of space.

      • I didn’t say that they can drop the onboard storage options I said that it would be less of a factor in the future because of the cloud. If everything but your app and a few other thing were store in the cloud then there woful still be plenty of room for your apps.

  6. fredhstein says:

    Interesting. I’m sure Apple will give more for the money re flash soon enough. They just reduced the MBA price. Apple sells a value bundle, where you get the higher quality, and often higher performance for what appear to be commodity items, and way better support. But I’m just re-stating that the so-called Apple premium is really a bargain considering TCO.

  7. vmax says:

    I agree this is not sustainable. The media is overall anti-Apple but why don’t they actually do something good for us by creating a “storagate”. How about a petition for more base model storage? But that doesn’t do well for upsell. Fewer will more to go from 32GB to 64GB because 32GB is enough. It’s all so weird apple releases 8GB version. I guess the calculation is that these people don’t buy anything on iTunes or App Store any way.

  8. juancastim135 says:

    The storage problem is one of the main reasons my friends prefer to buy an Android since here a few years back everybody used a blackberry with SD card, most of us are used to swap the memory out of the phone and not worrying about low disk space where as iPhone pricing over here ( even carrier subsidized) the “100 dollars extra” is a deal breaker for most (obviously counting on the fact that those 100 dollars are the triple in cost).

  9. Apple REALLY needs to have their base model starting out with 32GB. My 16GB iPhone 5 can be a pain sometimes.

    By the way, reading ‘so much how much music’ was confusing ;p

  10. While there is all this speculation about Apple trying to increase the price of the iPhone 6 by $100 due to the larger screen size, no one has brought up whether or not the storage capacity will also increase. My personal thought is that they’ll be able to charge $100 more for the extra capacity but they’ll also start the phones off at 32gb as opposed to the 16gb they’ve been doing. This way, they kill two birds with one stone. Charge $100 more and get both the larger capacity and the larger screen. I can very easily see them doing a $300/$400/$500 for 32/64/128 on the new iPhones.

    My thoughts on capacity:

    8gb – useless
    16gb – useless if you use any type of media; pictures, music, videos
    32gb – if you’re a normal person doing normal things on a smartphone, this is where you’ll want to be
    64gb – you should probably go through your photos and videos and delete some or transfer them to a computer
    128gb – you use your phone for too much and need to remember it is supposed to be a PHONE
    256gb – you should probably consider the outdoors, unplug, and get out every once in a while
    512gb – go away

    • “128gb – you use your phone for too much and need to remember it is supposed to be a PHONE”

      It’s 2014 and smartphones are just as much personal computers as they are phones. For some people, its usage in the former context far exceeds the latter.

    • thejuanald says:

      I have over 100GB of music, around 50GB of photos, countless videos, movies, etc. on my computer. What if I want all my music on my phone? No? Can’t do that? That’s not nice.

      One thing you people still seem to not understand is that eventually Apple will offer a larger MP camera, maybe even one that does 4K (there’s already phones out there that do that now). You’re saying you’ll never need more space? Come on.

      You people seem like people who would argue that nobody needs 1TB of space 6 years ago.

  11. Great article Ben. A lot of Apple enthusiasts think it’s wrong to question some of Apple’s practices simply because they are biased, but this article is one of the best ones I’ve read in a long time.

  12. Apple’s moving in the complete opposite direction lately with the introduction of the 8GB 5c.

    Apple’s not dumb, they base all these moves and storage options on sales and possibly on data sent to them thru iTunes about how much storage a user has used. If 16GBs and 32GBs are selling, but 64GBs are ~5% of sales (it’s likely they are single digits), then there is little reason for them to get rid of the 16GB and move up to 32GB as the base model. There is also very little reason for them to move up to a 128GB model if this is the case.

    It’s unfortunate, because I’ve needed a 128GB for 2 years now, since I have so much music and so many photos on my phone. I’m not holding my breathe for a 128GB iPhone 6 anymore. It’s likely maybe they will offer a 4th storage option of 128GB with the iPhone 6s or the 7, but I doubt it for the 6. If you want the move up expedited, buy the 64GB or the 128GB iPads and put your money where your mouth is. They look at this sales data in spreadsheets all day at Apple. Possibly increasing their iPhone ASP with a low volume 128GB 4th storage option is probably their most likely move at this point.

    Oh, and it’s not likely that it’s even a few dollars cost for them to go up to the 128GB option. It’s probably more like 15-50 cents cost for this, given their volume and purchasing power.

  13. Answer is very easy. SD cards are much much more slower than internal memory.

    • cdmoore74 says:

      But when it comes to music, movies and documents it’s fast enough. No one is saying replace faster internal memory with slower external sd cards. I use a $30 64 gig sd card with my Note 3 and I have no complaints with only 32 gigs of internal storage.

  14. This is probably the ONLY area I think Apple needs to step up. As an investor, I wasn’t really happy with the new 8GB iPhone 5c. I feel it’s just not a great way to intro people to the platform… However, I do realize they had/have data that likely states it’s worth making one.

    32GB works for me just fine but the trouble starts when traveling: storing lots of entertainment for flights, taking photos and lots of HD video.

    To the people who say 128GB is too much: Sorry, but with 4k coming along (even with compression), Apple needs to go there.

    • Yes, but everyone forgets the reality distortion going on on a Tech website forum. If you don’t play games a lot, (especially the shooters and “young male” games etc.), and you stream your media. 8GB is actually fine, and 16GB will last you forever.

      Everyone posting here is of the type that has ridiculous amounts of video or photos on their device or hundreds of games each taking up hundreds of MBs of space. The typical “normal” (average) user doesn’t do that and doesn’t need that storage.

      Also, the entire issue is being kind of misrepresented by the author (no offence to Ben). See my comment below for why.

      • mpias3785 says:

        You fail to realize that streaming media can cost money. I pay for 2GB cell data/mo. Anything over is $15/GB. With WiFi it’s not a problem unless you’re in a place that blocks streaming sites like some hotels, hospitals and airports. The more built-in storage, the less you have to stream.

        Why argue against mass storage? It’s coming. My first computer came with one 140k floppy, I currently have 7TB on my desktop not counting a 2TB Time Capsule, online storage and another 3TB storage kept offsite. Eventually mobile devices will have terabytes of storage just because that’s just the direction computer evolution is headed. Free-to-accesss and unlimited bandwidth would change this, but that’s just a pipe dream at this point.

      • OMG, funniest post ever! I don’t keep anywhere near the music on my phone nor do I shoot even 1/10th the photos that my “normal” friends do or my wife does. Yet I would LOVE a 256GB device.

        My wife’s iPad is absolutely always full. She’s constantly having to delete photos.

        16GB is nothing, even when you don’t keep any aps at all installed. TomTom takes up 1.5GB alone, and let me tell you it’s not the most storage heavy app in the store by a long shot.

        I don’t even use USB thumb drives smaller than 32GB because they’re more trouble than they’re worth – I threw out all my 1GB and 8GB drives a long time ago.

  15. I really thought the 5S would follow the 4S and give more storage. I cannot do 16gb. 64gb is great but not the price so i stick with 32gb. I’d love for 64gb at the 32gb price.

    I cannot upload all my music or video anyway, even with the 128 option. BUT Apps are getting larger and larger.
    Then you take photos and a few video and boom close to full.

    I think i only have 50-100 songs on my 32gb now. most of it is in apps and photo/video. There was a time when i could have 3500+ songs but that was before everyone went crazy with Retina and larger apps

  16. danbridgland says:

    One crucial overlooked point, Apple are happy to push all of your latest and greatest iOS purchases and volumes of photos and videos captured to all of your devices. This consequently consumes storage on not just one device, but two! Further instilling the notion of needing more on device storage.

    And how do Apple reward their loyal multi-device customers? Certainly not with additional storage for iCloud backup nor with complementary over-the-top services like iTunes Match.

  17. cdmoore74 says:

    The one plus one will have the fastest production snapdragon cpu, 3gigs of ram and 64 gig storage and will cost $350 off contract. Let that soak in for a few minutes.

  18. driverbenji says:

    16GB is NOT enough, I can’t believe Apple came out with that 8GB 5c…it’s only in consumers’ heads that 8GB is cheaper than 16GB.

    I think the VERY least Apple NEEDS to do is make the bottom line on the new models 32GB, making 16GB the smallest, dropping 8GB. It’s a SMARTphone, 8GB is not enough anymore! Not if you put a few apps on, some music, a few videos, but, especially if you take HDR pics or videos with that nice included cam! …I actually thought they were going to bump up last year, (iPads should be 32/64/128/256), if they don’t this year, then we will have to start making major noise to Apple about it!

    $100 to bump up the memory capacity is ridiculous. No, I don’t think they can maintain this indefinitely. We know they won’t give us an upgradeable option, people are too easy, but, give us an f/n break already, we know they can give us more memory on the low end and/or slash the price for more, and still make a profit. $50 is still profitable, but, as you said, they won’t go that low at first, perhaps $75?

    • driverbenji says:

      When I wrote above that 8GB is not enough… I meant the 16GB in my iPhone 5, never mind a newer phone (iPhone 6) that will have a better camera that takes pics that use more space. 16GB is not enough for the base line, at least if you are going to use it as a smart phone.

  19. Joel Henson says:

    I don’t care if they have it or not, because I’ll stick to the base model and make it work but I do hope they increase the base model to 32 gb.

  20. thejuanald says:

    I’d love for Apple to move towards adding SD slots (they never will, I know this, and I understand why) or huge capacities just to see the complete 180 everyone on this board makes about how Apple is so forward thinking and blah blah blah when they’re calling it a stupid idea right now.

  21. I think you are missing the point a bit here. The assumption of the article is that the base iPhone is priced “correctly” and that the storage tiers are add-ons that don’t reflect the value of what’s being added.

    In fact, what Apple does is spread the cost of the devices out across the three price points. So in fact the “extra” money they make on the higher storage iPhones is subsidising the base price of the device. If they eliminated the top two tiers tomorrow for example, then the base model would have to cost more than a hundred dollars more, at minimum.

    The prices are all artificial and intended to spread out the cost of all three models. If they didn’t do this, and instead priced everything simply at what it was worth or what it cost, then the memory tiers would indeed be very, very cheap, but the base cost would skyrocket.

    • thejuanald says:

      How exactly? According to this website, the iPhone 5 NAND parts cost Apple $9 for the 16GB model, you actually think the 64GB NAND components cost Apple enough to justify an additional $100?

      http://www.cultofmac.com/190822/the-iphone-5-only-costs-apple-168-for-the-parts/

      My thought from this other article is that the 64GB storage component costs around an additional $10 seeing as how the 5S costs range from $173-183 to make from the 16GB to the 64GB.

      How exactly is that incredible increase in cost subsidizing the lower end units? And how exactly would that $10 increase in production costs from the 16GB to the 64GB justify a $100 increase in the 16GB cost to the consumer?

      You’re not making sense. They could make a 64/128/256GB setup that costs $200 to make, and sell them for $200/250/350 and it would be just fine.

      • No, I think it makes sense completely. What he’s saying is that the *people* who buy the larger-capacity models are subsidizing the “artifically-low” price paid by the *people* who only want the cheapest models. In other words, the cost of *entry* into the ecosystem (via buying the cheapest model) is lowered because the larger-capacity models are priced the way they are (with large jumps in price). This is “bad” for those who need/want the larger models, but “good” for those who just want the device as cheaply as they can get one.

      • thejuanald says:

        Well that’s just silly, then. The low end devices could still have 64GB and not increase the price. Then the the actual large capacities could subsidize the low end device.

        Telling people what they need and don’t need is nonsensical.

  22. They definitely need to increase the minimum storage capacity for the iPhone 6 and 2014 iPad Air/Mini to 32GB. I think they’ll maintain the price hikes for the long term, but perhaps add in more differences in their A-series chips to make it seem slightly more worthwhile for customers.

    But a quote like this makes it all hard to accept: “Apple spends at least $191 on components to build a 16 gigabyte iPhone 5s. The cost rises to $210 for a 64GB unit.”

    http://allthingsd.com/20130924/teardown-analysis-shows-iphone-5s-costs-at-least-199-to-build-173-for-the-5c/

  23. PMZanetti says:

    As long as you’re comparable non-user managed internal storage to external SD card storage….I’m not listening.

    That’s no comparison at all.

    And don’t show my unsuccessful hardware (Google) that has $50 differences between built-in storage models. If anyone wanted them, Google wouldn’t have been dumb enough to lose money where Apple makes it.

    • herb02135go says:

      My first iphone was 32 gig. Next I went down to 16 as I didn’t want to pay the extra money
      I realized I could get a samsung phone and then get expansion later. It works great and I don’t notice any loss of speed in accessing my media.

      The extra storage is great because I can download videos and files, and I dont need an Internet connection to retrieve them from the cloud.

  24. Stetson says:

    I do think that at least their premium/flagship devices (iPhone 5S, iPad Air, iPad Mini Retina tiers) should start at 32GB. A 16GB 5C or previous-gen device isn’t a huge deal, but for the flagship devices an extra couple of dollars to jump to 32GB would be very nice.

    I think that they will and should keep the $100 price tiers, but provide more of a value-add. Instead of paying $100 for an extra couple gigabytes of flash, make the $100 buy you the extra internal storage plus extra iCloud storage to match.

    Right now you can buy a 64GB iPhone for a very hefty premium but the default iCloud storage runs out if you try to back up more than 5GB of data. If a customer forks out the extra money for an expensive, top-of-the-line Apple device I think that the experience should be a lot better for online storage and backups.

  25. Either apple can give us more storage for the same price, or they can find a new market, the world passes greedy companies by, because greed is unable to adapt to a ever changing world.

  26. thejaam says:

    It’s a very large world out there, and many places do not have the access to cloud storage, be it technical or the economic cost, that other countries do. So for some of us, we don’t use cloud and need our on board storage.

  27. va1an says:

    Great article, Ben.

    If we look at where the iPhone is transitioning to (desktop power) then I think Apple will begin to offer less choice in memory capacity to reflect the users usage of the device.

    Three choices seem too many. I can see Apple offering a ‘consumer’ level device and memory and a ‘producer’ level. Producer for those who want to edit stuff or keep a lot of media internal and consumer would be for those who just want a phone to take pics and have a radio.

    Maybe Apple will use the name iPhone Air and iPhone Mini rather than the numbering system.

    • Ben Lovejoy says:

      Thanks, va1an. On the editing front, I have to say that if you’d told me a few years ago that I’d be editing video on a phone, I’d have laughed. I still find it amazing how well it works on that tiny screen.

      • va1an says:

        True.
        And soon we’ll just sit down at our desks and, as if by magic, our phone links to the monitor and keyboard giving us a desktop experience.

  28. Unrelated to the basic point of the article, but I beg anyone reading this NOT to buy the 64GB SD card linked to in this article (and Ben, if you happen to see this, you should probably remove that link, if you can), as I can all but guarantee they are fake. I used to fight a battle with all the ebay sellers selling these fake cards (I have about 20 that I purchased and tested, most of them in generic packaging identical to this, and not ONE of them was legit…they were all defective 2-4GB cards that were reprogrammed to *look* like they were 32 or 64GB and the file system would treat it as such. It would look like you stored all your files on there, until you tried to read something past the actual 2-4GB size of the memory chip, then the data was corrupt. There’s a lot of info and how to test it at http://sosfakeflash.wordpress.com/

    • Ben Lovejoy says:

      Thanks, Andy – I’d not encountered that before

      • Umm, Ben? Have you looked at this guy’s site? Sure, there are probably unscrupulous people on rando type websites (and yes, even through eBay) that are selling repackaged flash memory devices with incorrect storage capacity or, even more likely, knockoff/generic devices coming out of the same or similar factories.

        However, read this guy’s site. It looks/reads like someone who’s had a bit of a break. Psychologically. All you need to do is replace “fake flash” with “black helicopters” or “government-controlled hormones” and you’ve got all you need to know.

  29. zubeirg87 says:

    I think the clear solution is the 2nd mentioned in this article, which is to double the existing storage options. Infact they should have done it way back. I was really deceived when i saw the 5s and ipad air starting at 16gb. This is ridiculous. It is a total bad Apple here.
    My opinion is that the 3 storage options system is very fine, but it’s just that Apple needs to upgrade those options as soon as possible. 32/64/128gb is long overdue and 64/128/256gb should come asap. The $100 tier pricing will work just fine as long as Apple doesn’t fail to update them at the right time.

  30. Its not technical issue but rather political and marketing one. More space is always welcomed, no matter what type of user you are (I can still live with 8GB of storage provided that I dont play games on my phone and store my photo and music collection offlice). However, Apple invested bilions of dollars in infrastructure for cloud storage (those data centers and servers are not cheap) so the users can access all their data without duplicating the file on two devices. The whole problem comes from the carriers who want to cap the data plans and increase the data traffic (so they can charge you more). However, note that 16GB device outnumber the 32GB and 64GB many times so the market for lower storage device is significantly larger that for more storage. Neverthless, for a flagship device and for premium product as the iPhone, the customer must have the entry level device with suficient premium storage. If a 200$ android headset can come with 16GB buld-in, cant see why an iPhone for 600$ cant come with 32GB build-in. Few bugs more per unit means a half bilion dollars in margin reduction for one year so its a very big decision to take. You dont want to spend that much money, if its not a must and considering the the use of the mobile phone nowdays, its still not a must.