Apple officially introduces the iPhone 16e, a budget-friendly version of the iPhone 16 featuring a modern design, integrated Apple Intelligence, and an energy-efficient 5G modem, promising a major shift in the mid-range smartphone segment.
Apple Expands Market with iPhone 16e
On Wednesday, Apple officially announced the iPhone 16e – a new budget version of the iPhone 16 lineup, marking a significant step in the company’s strategy to capture the mid-range smartphone market.
This is also the first iPhone equipped with a cellular modem designed by Apple and the most affordable iPhone to support Apple Intelligence.
Priced at $599, the iPhone 16e will officially be available starting February 28.
Apple’s New AI Strategy for Budget iPhones
Integrating Apple Intelligence into a more affordable iPhone could help Apple reach a broader audience with its AI-powered tools.
As Google and Samsung continue to push AI features on smartphones, Apple also needs a competitive strategy.
Google’s Pixel A series, for example, has received positive reviews, while Samsung and Google have been consistently updating Android devices with AI features over the past year.
The iPhone 16e marks Apple’s shift away from the iPhone SE, which accounted for just 5% of U.S. iPhone sales as of December 2024.
While priced higher, the iPhone 16e offers a modern design similar to Apple’s latest models, unlike the SE, which retained the outdated Home button and Touch ID.
Key Features of the iPhone 16e
The Most Power-Efficient 5G Modem Ever in an iPhone
Apple claims the iPhone 16e is equipped with the “most power-efficient 5G modem ever in an iPhone.”
This comes more than five years after Apple acquired most of Intel’s smartphone modem business in 2019.
By developing its own modem, the company reduces dependence on external suppliers and gains more control over product development.
Modern Design, Phasing Out the iPhone SE
Following the iPhone 16e announcement, Apple has removed the iPhone SE from its online store.
Compared to the iPhone SE’s outdated iPhone 8 design, the iPhone 16e offers a more modern look with a 6.1-inch edge-to-edge display, Face ID, a 48MP camera, and an Action button for quick shortcuts.
While it lacks some high-end features like a second camera for wide-angle shots or a dedicated Camera Control button, the iPhone 16e shares many similarities with the standard iPhone 16, delivering a smooth experience at a more accessible price point.
Apple Intelligence on the iPhone 16e
The iPhone 16e is powered by the same processor as other iPhone 16 models, enabling it to run Apple Intelligence – Apple’s suite of AI-powered tools.
Apple Intelligence offers AI features like custom emoji generation, notification summaries, object removal in photos, and ChatGPT integration with Siri.
Previously, it was only available on premium iPhone 16 models, the iPhone 15 Pro/Pro Max (2023), and select iPads and Macs.
Bringing AI to the iPhone 16e reinforces its role in the product ecosystem.
Will AI Be Enough to Drive iPhone Sales?
As tech giants like Google, Microsoft, and Samsung position AI as the future of technology, Apple is also stepping into the race.
However, it remains uncertain whether AI features on the iPhone 16e will be compelling enough to drive smartphone upgrades.
According to Apple’s fiscal first-quarter report for 2025, iPhone revenue fell short of investor expectations.
The launch of the iPhone 16e could be a crucial move to attract new users and strengthen Apple’s position in the mid-range smartphone market.