In my last post, I compared the iPhone 16e against other current models and provided a simple guide on which iPhone to buy if you’re in the market for one right now. In this post, I want to dig into the reasons behind the iPhone 16e's creation.

Nobody expected an iPhone 16e

If there were an explicit target for the iPhone division, their job would be to sell as many iPhones as possible. Other key metrics—like AppleCare and Apple One subscriptions or achieving higher profit margins—matter, but the total number of iPhones shipped is a fundamental target.

With the launch of the iPhone 16e, the two entry-level iPhones, iPhone 14 and iPhone SE (3rd gen), were both discontinued. Especially the budget-friendly iPhone SE line ended without a direct successor, which would make Apple unable to capture the sub-$599 market any more. Unless sales of the iPhone SE (3rd gen) were negligible, suddenly discontinuing it without a proper successor doesn’t make much sense. 

There could be two explanations: 

1. Apple expects the iPhone 16e to sell more units than the iPhone SE (3rd gen) and iPhone 14 combined, and also promote more iPhone 15 sales.

2. Apple is willing to suffer short-term sales loss on the SE line in order to achieve a clearer product strategy aimed at long-term success.

Since the iPhone 16e is $599, why did Apple kill the much cheaper $399 iPhone SE (3rd gen)?

Theoretically, the iPhone SE (3rd gen) could still capture a certain market if Apple wanted to extend its lifespan.

If Apple didn’t kill the iPhone SE (3rd gen), here is how it’s compared to the iPhone 16e today based on the official comparison tool: Apple Compare Tool

There is seemingly no direct conflict between the two models. And if Apple wants, they could have easily put in a USB-C (mandatory by EU) into the iPhone SE’s body or even an A18 chipset and keep selling it for a few more years. From a specs perspective, it looks clean.

The biggest reason could be that the iPhone SE is damaging operational efficiency

One possible reason Apple retired the iPhone SE (3rd gen) is its outdated design. When Apple replaced the original iPhone SE with the 2nd-gen model, its design had been in use for eight years since iPhone 5 (2012–2020). The iPhone SE (2nd & 3rd gen) inherited its design from the iPhone 7, which launched in 2016—so by now, it’s been nine years.

Because of this aging design, the iPhone SE relied on its own unique set of sensors and hardware, which were no longer shared with other iPhone models. This means there would be dedicated supply chain resources to keep the production running, including personnel and materials. Also, without the benefits of mass production economy of scale, keeping the iPhone SE in the lineup became more expensive rather than more cost-effective. That made it both a financial and supply liability risk for Apple to continue producing.

More importantly, as a company as focused as Apple couldn’t bear those kinds of distractions to its core product lines and business.

On top of that, if sales are also looming, Apple likely decided it wasn’t worth the trouble to maintain production for what was ultimately a small group of buyers.

How about an iPhone 14-shaped iPhone SE?

As I pointed out in my last post, the gap between the iPhone 14 and iPhone 15 didn’t make much sense—it could easily confuse buyers. On top of that, the EU banned Lightning connectors, making it even clearer that Apple needed to tweak the iPhone 14. 

With the iPhone SE (3rd gen) discontinued and a needed change to iPhone 14, Apple could have made two products:

1. A new iPhone SE at $399 that's a downgrade from the iPhone 14

2. A new iPhone 14 with upgrades like USB-C, so it can be sold in the EU

For product #1: If Apple had instead decided to launch an iPhone SE (4th gen) in the shape of iPhone 14, while keeping iPhone 14 with USB-C for minimal changes, the specs might have looked like this:

With just a $100–200 difference, this hypothetical SE4 would lose a second camera and features like MagSafe and UWB. But this was the same issue the iPhone 14 had against the iPhone 15—there simply wasn’t enough differentiation. 

Or another reason could be that Apple couldn’t keep the new iPhone SE4 cost low enough for a healthy margin. Which can very likely be the case since the majority of the cost would actually go into display, chipset and mechanical design.

So Apple made product #2 and named it iPhone 16e.

The iPhone 14 upgrade is destined to be named after iPhone 16.

I don’t know why Apple hasn’t simply updated USB-C and kept the same naming, but if they are changing anything else, from a branding perspective, the new phone had to be part of the iPhone 16 series. Launching an iPhone 14s or iPhone 15 SE would be really weird since those two product lines were launched 2.5 and 1.5 years ago. It would feel like, "Hey, there are some products that were collecting dust in our warehouse, and we just found them!"

How Did Apple Define the iPhone 16e?

When a company like Apple conceptualizes a new product, on top of roadmap clarity and consistency, it sorts features into three categories:

1. Must-have 

2. Can't-have 

3. Gray areas 

As I don't have any internal sources helping me put together the puzzle, I will take some educated guesses here. The must-haves and can't-haves are easier to sort out, while gray areas can lead to some debate.

Must-Have Features:

Apple tends to stick with what already works, especially for the entry-level product. That means keeping the iPhone 14’s design, display, and Face ID. USB-C is a given since it’s mandatory to be sold in EU.

Also, as explained above, if the product is destined to be an iPhone 16 family member, then there are things to be included to stay consistent: the A18 chipset that offers Apple Intelligence (billions of marketing budget already spent on it) and the Action Button (probably cheaper to make than the ring/silent switch).

Can’t-Have Features:

The can't-haves are equally important, so this new phone doesn't hurt existing products' sales nor confuse customers. In my original review of the iPhone 16 Pro, I mentioned that Apple is preparing for spatial content, which is why the iPhone 16 models have a pill-shaped dual-camera design. If the iPhone 16e also had dual cameras, it would potentially undercut the iPhone 15 again. So the second camera had to go.

Gray Areas (Battery, MagSafe, UWB):

UWB:

I think this is mainly due to cost and low usage. My personal experience with it is that the tap-to-play or tap-to-share functions are buggier than traditional UI-initiated AirPlay and AirDrop. The UWB chipset itself is also a significant investment device-wise.

Battery/MagSafe

Longer battery life is a top selling point for the iPhone 16e. Apple also claims the battery itself is physically larger. We still need to wait for a teardown to understand exactly how many more mAh were packed into it. The real issue here is that MagSafe is missing.

Similar to a chicken-egg problem: Did Apple kill MagSafe first and then fit in a bigger battery, or did Apple decide to fit in a bigger battery first and then found no space for MagSafe magnets?

I think the strongest argument here is that if Apple has been comfortable launching the iPhone 15 with 20 hours of battery life (video play) and the iPhone 16 with 22 hours of battery life in the past two years, there is no absolute reason for them to sacrifice another feature to save more internal space for a bigger battery.

More than likely, MagSafe was removed to create a clearer feature gap between the iPhone 16e, the iPhone 15, and the soon-to-be-discounted iPhone 16. Then there would be more space reserved for a bigger battery.

Conclusion: Apple needs iPhone 16e more than you do

At first glance, the iPhone 16e may seem like an unnecessary addition to Apple's lineup—neither a true budget iPhone nor an exciting new model. It’s a calculated move to optimize Apple's product strategy, eliminate inefficiencies, and align with evolving market demands.

Maintaining an outdated design like the SE for a shrinking user base wasn't sustainable, and keeping the iPhone 14 with minor tweaks could have led to confusion in the lineup. Instead, Apple introduced the iPhone 16e as a rebranded and slightly modernized iPhone 14.

Could Apple have done things differently? Maybe name it iPhone 16 SE, which would seem more logical to me. Product-wise? I don’t think Apple has many cards to play here.

At the end of the day, you may not need the iPhone 16e, but Apple certainly does.