Apple has raised iPhone prices by $100 and introduced the $1,999 iPhone Duo, driven by severe memory chip shortages and AI-related supply inflation. In India, consumer adoption continues to surge despite these cost increases, supported by widespread EMI financing and a rapidly growing affluent consumer base.
Apple has fundamentally altered its pricing strategy for both new and older hardware. Following the release of the latest flagship lineup, the company implemented a $100 price increase across new and older iPhone models, compounding years of steady price escalations that began with the launch of second-generation devices in 2008.
The Fourfold Increase in Base iPhone Pricing Since 2008
When Apple launched early smartphone iterations, consumers could purchase a base device for a starting price of $199 with 16GB of storage under carrier-subsidized contracts with providers such as AT&T, Verizon, Sprint, and T-mobile, as reported by Gulfcoastnewsnow. Once carriers phased out subsidies, buyers had to pay the full upfront cost.
Over subsequent product cycles, base prices climbed steadily. A significant shift occurred in 2016 when the iPhone 7 debuted at $649 with 32GB of storage. The introduction of the Pro and Pro Max tiers in 2019 established higher pricing ceilings, starting at $999 and $1,099, respectively. Those figures rose further to $1,199 in 2023 with the iPhone 15 Pro Max base model. Today, the least expensive brand-new base model sells for $699, while the latest iPhone 18 Pro Max starts at $1,299 for 256GB of storage and reaches $2,399 for 2TB of built-in capacity, according to historical tracking data compiled by Gulfcoastnewsnow.
Component Shortages and the AI Data Center Boom
The root cause of the latest price adjustments lies deep within the semiconductor supply chain. Memory chips, essential components for both consumer gadgets and AI data centers, are experiencing unprecedented demand that has triggered global shortages.
Photo: NDTV
Memory vendors have aggressively reallocated standard DRAM and NAND manufacturing capacity toward enterprise-focused products like high-bandwidth memory (HBM) and enterprise solid-state drives to serve the artificial intelligence infrastructure buildout, according to Deloitte’s July report. That shift has pinched consumer electronics supply chains, pushing component costs to unsustainable levels.
Describing the semiconductor market pressure during an earnings call and in an interview with The Wall Street Journal, the former executive called the event an anomaly in his four decades overseeing supply operations.
“This is a hundred-year flood,” he told the Wall Street Journal. “I’ve never seen anything like it in any area in over 40 years.”
Tim Cook, former Apple Chief Executive Officer, via The Economic Times
India’s Pricing Reversal and the Introduction of the Foldable iPhone Duo
In international markets, the hardware cost increases have broken long-standing retail patterns. In India, where local manufacturing historically helped Apple hold prices steady across generations—keeping models like the iPhone 12 through iPhone 16 starting at Rs 79,900 since 2020—the company surprised consumers by raising prices on older models instead of discounting them, The Economic Times reported.
Apple's Price Hike: iPhone 18 Prices Soar in India, Why Are Older iPhones Getting Costlier Too?
The iPhone 17 moved from Rs 82,900 to Rs 99,900, the iPhone 17e shifted from Rs 64,900 to Rs 79,900, and the iPhone Air climbed from Rs 1,19,900 to Rs 1,49,900, as The Economic Times detailed. At the same time, Apple unveiled its folding flagship device, the iPhone Duo. The device starts at $1,999 in the United States and is priced at Rs 2,99,900 for the base 256GB model in India, with top variants reaching up to Rs 4,49,900, according to Telegraph India and NDTV.
The nearly Rs 1 lakh price gap between the US and Indian markets for the new foldable flagship stems directly from regional taxation and trade policy. Smartphones are classified as luxury goods, attracting an 18 per cent Goods and Services Tax (GST) in India. Furthermore, because the folding device is manufactured outside the country, it incurs import duties of approximately 17 to 18 per cent, Telegraph India noted.
Segmented Demographics and the Rise of Consumer Financing in India
While India’s annual per capita income sits at roughly $2,813 (Rs 2,33,479)—meaning the flagship folding device costs nearly double what the average worker earns in a year—analysts emphasize that national averages obscure the actual buying power in the region, NDTV reported.
Photo: Telegraph India
Sohom Banerjee, founder of Quantive Advisory LLP, explained to NDTV that the market functions as a segmented economy comprising three distinct tiers. The affluent top layer, designated as India A, features spending habits comparable to advanced European nations. Even if only 5 per cent of the population can afford premium hardware, that demographic encompasses nearly 70 million individuals—surpassing the total population of major European countries.
“India is becoming a segmented consumer economy in which a relatively small affluent cohort is large enough, in absolute numbers, to resemble an advanced economy.”
Sohom Banerjee, founder of Quantive Advisory LLP, via NDTV
Supporting that affluent tier is an extensive credit ecosystem. Industry executives note that digital payment infrastructure, credit cards, and Equated Monthly Installment (EMI) options convert large lump-sum purchases into manageable recurring payments, altering purchasing behavior, according to NDTV coverage.
Market shipment figures demonstrate this shift. India’s overall smartphone market grew by only 1 per cent by volume in 2025 but expanded by 8 per cent in total value. Meanwhile, Apple’s device shipments increased by approximately 28 per cent, capturing roughly 28 per cent of total market value, NDTV noted. Financing accounts for nearly two-thirds of premium smartphone purchases made through mainline retail channels, representing about 35 per cent of all smartphone purchases in 2025 with projections to reach 42 per cent.
Market Outlook and What Consumers Face Next
As component constraints persist, market researchers are watching to see if rising retail prices will prompt buyers in emerging economies to delay purchases or forgo upgrades entirely, or if credit availability will sustain demand through ongoing macroeconomic pressures, according to Currentpoint Research cited by Telegraph India.
Apple’s New iPhone Prices Are Worse Than They Look
