KGI: 4-inch iPhone resembling iPhone 5S with A9 chip, curved glass edges, Apple Pay, and more, to launch early 2016
New A9-Based 4-Inch iPhone Expected to Launch Early 2016 With Apple Pay and Colorful Metal Casing — KGI Securities analyst Ming-Chi Kuo has issued a research note corroborating rumors …
Context & Ripple Effects
KGI Securities' Ming-Chi Kuo is putting analyst weight behind months of supply-chain chatter that Apple will revive the 4-inch form factor in early 2016 — a device shaped like the iPhone 5S but running the A9 chip, adding curved glass edges, NFC, and Apple Pay support. The note matters because it reframes the small iPhone from leftover legacy SKU to a deliberately refreshed product line.
The reporting arc since has sharpened rather than confirmed Kuo's first draft: sources later described the device as the 'iPhone 5se' shipping March/April with Live Photos but downgrading his A9 claim to an A8/M8 pairing, and Kuo himself followed up in February with a $400–$500 price point, 12MP camera, and a planned 50% price cut on the aging iPhone 5s.
First-order effects
- Buyers who never moved to 4.7- and 5.5-inch flagships get a current-generation option — Touch ID, Apple Pay via NFC, and curved-edge styling — instead of choosing between an outdated 5s and a phone too large for their preference.
- The reported 50% cut to the iPhone 5s immediately repositions Apple's entry tier, clearing channel inventory ahead of the new model's spring launch.
Second-order effects
- Putting Apple Pay hardware into a $400–$500 phone extends the payments service beyond flagship owners, widening the transaction base Apple is building across its installed base.
- A sub-flagship with flagship features pressures Android vendors competing in the same mid-price band, forcing them to match NFC payments and modern silicon at those price points.
Third-order effects
- If Kuo's follow-on reporting holds — a 2017 iPhone with a curved glass case and 5.8-inch AMOLED display — the curved-edge design language debuting on this small model becomes a trial run for the flagship line, suggesting Apple uses lower-volume SKUs to de-risk new industrial design.
- The pattern points toward Apple managing the iPhone as a segmented portfolio with staggered refresh cycles rather than a single annual flagship, with analysts like KGI effectively setting market expectations between launch events.
The trend: Apple is evolving the iPhone from one flagship per year into a tiered lineup where refreshed small-form-factor models carry current services like Apple Pay downmarket.