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Apple’s Sapphire iPhone Costs Could Be Lower Than Expected

Apple’s plan is to work synthetic sapphire into pricier next-generation iPhone models,according to the WSJ, provided they can get enough supply. While some analysts quoted expect this to potentially increase the consumer price of iPhone hardware, I’d be very skeptical of next-gen smartphones from Apple carrying retail costs higher than they currently do for buyers. Instead, screen size would likely be the driver of an increase in price.

That could make a 5.5″ iPhone, if that happens, more expensive, but would leave the current starting price alone for a new model, even at a slightly bigger 4.7″. Even Apple’s smartwatch, which is also said to be getting a sapphire screen in this new report, likely won’t overstep the cost of current competing devices when and if it ships.

Keep in mind that Apple watchers from the analyst community have previously thrown cold water on the idea that Apple would be able to replace Gorilla Glass with sapphire as the main material for its screens at all. Analyst Eric Virey has often been cited as claiming that, based on his cost estimates, sapphire was not a viable material for smartphone screens for Apple, citing manufacturing costs of $30 for a smartphone screen, with a possible drop to $20 after “a couple of years” – now, he’s quoted in the WSJ as saying that it might cost more than five times as much ($16 vs. $3) to make the displays using sapphire rather than Gorilla Glass.

But after consulting materials and industry experts, we discovered that Apple has some tricks up its sleeve that could offset the cost of manufacturing sapphire displays. Last year, it partnered with sapphire manufacturer GT Advanced to begin ramping up production of the material. GT Advanced also acquired a company called Twin Creeks Technologies, which created a wafering process called ‘Hyperion’ which can help significantly reduce the cost of making sapphire screens, in combination with Apple’s own patent on sapphire laminates.

By using a cheaper glass as the ‘base’ of the laminate, with sapphire on top, Apple may actually be able to keep the costs down. Low enough to come far closer — or even below — the costs of Gorilla Glass (which, according to sources, Apple hasn’t actually used for iPhone for a while now).

Gorilla Glass is reinforced glass, and far more expensive. By manufacturing sapphire and using the Hyperion ion bombardment technique — slicing super thin sheets of sapphire in a really high-yield — along with lamination, Apple could produce a stronger cover sheet for their smartphones for around the same cost. Not, as some analysts are saying, for a multiple of 5x or more.

In other words, Apple might have to spend a bit more to create sapphire displays for its smartphones, especially given the sizes required to create screens for 4.7-inch and 5.5-inch devices, as rumored, but it shouldn’t have to deal with any increases significant enough torequire it to up the price for consumers.

If Apple does bump up the price, it will likely be due to increases in cost that come from size — including a larger display of course — and what it feels the market will bear. And, judging by the demand for larger screen phones, it could probably bear more scratch for an Apple version.

All will be revealed on September 9, so we don’t have long to wait to find out just how sapphire-infused and just how expensive (or not) the next iPhone is. We’ll have live coverage and in-depth posts when the whole thing goes down.

Source: http://techcrunch.com/2014/08/14/apples-sapphire-iphones-costs-could-be-lower-than-expected/?ncid=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29

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