Why Apple has stopped making small phones—and why it should start again

The new iPhone SE is here, and it's an attractive product: it combines a tried-and-true design, arguably the fastest mobile chip in the industry, and a $400 starting price point. It might be the most appealing phone in Apple's lineup for a wide range of users.

That said, it's quite a bit bigger than its predecessor. Consumers who were hoping for the return of the 4-inch display, or maybe even a slightly larger display but in the same grip size as the original SE, were likely disappointed by this week's announcement. Apple is not alone in skipping smaller handset offerings; there aren't many small Android phones left, either.

There are reasons for this trend that make sense both for the tech company and the consumer, but there are also reasons Apple shouldn't turn its back on a minority of consumers who still want—or even need—smaller phones.

Why there aren't many small phones anymore

There are numerous reasons not a lot of very small smartphones get made at this point. There is some overlap between why Apple has emphasized larger phones and why Android OEMs have, but there's also some overlap. In any case, we'll focus on Apple here since we're discussing the iPhone SE.

Bigger phones mean bigger revenue

You've probably noticed smartphone prices going up; part of that reflects the fact that some consumers are willing to pay more than they were previously because of how central smartphones have become in so many aspects of our lives. But part of it is because companies like Apple need to please investors, and if they can't do that by selling more phones, they can do it by selling a smaller number of phones at a higher price per unit.

As the market has become saturated, Apple and Android OEMs are seeing slower smartphone sales growth—and people are upgrading less frequently for various reasons, too. This makes the economics of selling low-cost smartphones more unfavorable than they have been in the past. To make up for selling fewer units overall, Apple and its competitors need to sell more expensive phones than before.

It makes sense for smaller phones to sell for cheaper because they contain fewer expensive materials and components. And a company couldn't just sell the small phones with a huge margin; a competitor would be able to undercut that price with a comparable phone.

Apple's emphasis on content and services calls for bigger screens

Investor pressure mounted on Apple in recent years to make up for the slowing growth of smartphone sales, and more expensive phones hasn't been the company's only apparent strategy. Another has been to pivot to sell additional products and services to existing customers, ranging from AirPods to the Apple Watch to subscription services like Apple TV+, Apple Arcade, and Apple Music.

Generally, that strategy requires smartphones to be treated as primary media consumption devices—not just for short TikTok videos, but for long binge sessions of Arcade games or TV+ shows. (Also, Apple receives a cut from subscriptions to other video services started through its payment system.) That means it makes sense to emphasize more powerful devices with larger, more immersive screens.

It's not much fun to watch For All Mankind or play Sayonara Wild Hearts on a 4-inch screen. With 6.5 inches, though? That might be a different story for some, especially if that phone also sports an OLED display with HDR support like the iPhone 11 Pro Max.

Modern features don't fit in small packages

Those business-related reasons are part of the picture, but neither is the most significant reason. There are technical and design reasons, too.

Over time, Apple and its competitors have added more features and components to smartphones, requiring more space inside the phones to put those things in. And it just so happens that most of the top priorities of smartphone buyers run counter to the ideal of a small phone: battery life and cameras.

In February of 2019, market research company SurveyMonkey asked smartphone buyers what their top priorities were. The leading concern was battery life, cited by 76 percent of iPhone users and 77 percent of Android users. Also near the top: better cameras, at 57 percent and 52 percent, respectively.

A similar survey of 575,000 US consumers by Global Web Index also put battery life as a concern for 77 percent of smartphone users. Camera picture quality landed at 62 percent, and screen resolution was also high at 52 percent.

Below: Photos of the iPhone SE from our review back in 2016.

Listing image by Andrew Cunningham

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