Smartphones are essential. $1000 smartphones are luxuries.

Unless you are locked into the platform. Sure, people hold off upgrading for a bit or buy an older phone, but people dont leave the ecosystem for a 200 dollar android. They'll be safe in the long run.

This makes me realize that a lot of people have never experienced real poverty.

If a depression comes, people will soon have to choose between eating and paying their rent and utilities. Phones won’t even enter the picture.

What is a smartphone if not a utility? A portable, reusable, device used to communicate, navigate, organize, create, and educate oneself?

A smartphone is more important than paying your electricity bill.

I really think you're living in denial of modern reality. A smartphone gives you access to jobs among other things.

We are not talking about a smartphone vs no smartphone, we are talking about a $1,000 vs a $200 smartphone (or a 4y old model).

And to my point, both of those models will be iPhones for a lot of people, and apple's brand will be fine.

I don't know if apple makes any cheap phone, but either way, the problem isn't apple's brand, it is apple's profits.

Apple's operating margin is the lowest it's been in a decade. What are you talking about?

What about $700 phones, or $450 ones? Those are also new Apple products, just not the most expensive model in the lineup, and when you do the math for the 4-5 years an iPhone lasts it becomes obvious that you should be talking about the much greater cost of cellular service instead.

the smartphone is the computer. at $1000 many consumers use it for all of their daily needs, many of which ironically have nothing to do with phonecalls.

And pretty much all of which they can do just as well with a $200 smartphone or a 4y old model.

They are not luxuries to the extent you're implying. Your lifeline needs to be dependable and high quality. People inherently understand the value of tools and paying for something that'll get the job done reliably.

People spent in aggregate way more to accomplish fewer things before the iPhone (or equivalent high-end Android phone).

My smartphone is my primary camera, my communication device, my transportation lifeline, my business operations lifeline, etc etc.

I can't afford for this one thing to be the point of weakness. $1000 is extremely cheap relative to the value I get out of it - it would be a waste of time and money for me to skimp here. Not to mention, once you're in the ecosystem, breaking your workflow is extremely expensive so there's an element of lock-in.

Apple are in a stronger position than anyone gives them credit for.

If you realise you're now locked into the Apple ecosystem don't you want to do anything about it? It's very risky, it is your point of weakness.

I like being in the ecosystem. I'm "locked" in the sense that nothing else meets my needs and no one else has a whole suite of products that work so well together to solve my problems.

The benefits have far outweighed any inconveniences for me in nearly 2 decades as a customer.

Doesn't mean there aren't issues, but in general I am very happy with the ecosystem.

Anyway this gets away from my original point. $1k is not a lot of money for what a smartphone is and the role it plays in our lives (which is only ever increasing).

It's silly to skimp on something so integral that you'll likely have for 3-5 years (or more!). All for what? Saving $500? This is why the high end smart phone market won't be impacted as sharply as you're predicting. People understand this.