Can Japan still afford the iPhone? The price wall and the fate of the iPhone kingdom

Good evening. The Owl here. In the quiet of the night, as I look out over the city lights, I get the feeling there are a few fewer glowing Apple logos on the little screens in people’s hands than there used to be.

Japan’s smartphone market was once called an “iPhone kingdom,” a place where Apple products were loved like almost nowhere else in the world.

But a weak yen and rising component costs have pushed the iPhone’s price tag steadily upward. The latest model, which once cost around ¥100,000 (roughly $650), now runs over ¥150,000 (roughly $970), and high-end models above ¥200,000 (roughly $1,300) have become the norm. This price wall has dampened Japanese buyers’ appetite, and people have even started to whisper, “Maybe I just can’t afford an iPhone anymore.”

This time, with some recent data in hand, let’s think together about how these hard-to-reach prices are shaping the way people choose smartphones, and how the iPhone kingdom, built up over so many years, is now wobbling.

Sunset over the kingdom: rising prices and shifting share

In September 2025, MMD Labo published its smartphone OS share survey. It found that 48.3% of people use an iPhone as their main phone and 51.4% use Android, with Android widening its lead from the year before [1].

This “reversal” didn’t happen overnight. The two operating systems had been locked in a close fight over the majority for years. In recent years the iPhone had clawed back and held the majority, but the latest survey shows Android’s edge becoming clear.

Listening closely in the forest at midnight, I can sense the iPhone’s stronghold crumbling and Android’s footsteps drawing near.

So why is the “iPhone faith,” once thought unshakable, starting to waver?

The biggest reason is price.

A weak yen and higher component costs, among other things, have pushed iPhone prices in Japan up sharply.

In the iPhone 17 lineup announced in fall 2025, the standard model starts at ¥129,800 (roughly $840), the Air at ¥159,800 (roughly $1,000), the Pro at ¥179,800 (roughly $1,200), and the top-of-the-line Pro Max at ¥194,800 (roughly $1,300). Every one of them is priced higher than before [2]. Look at the price table by model and storage, and the 2TB Pro Max reaches ¥329,800 (roughly $2,100) [3]. That’s luxury-appliance territory.

While prices climbed, the weak yen eroded purchasing power. By 2024, more and more people were lamenting that an iPhone you could buy for about ¥100,000 a few years ago now costs over ¥150,000, and the high-performance models top ¥200,000 [4].

To my owl’s eyes, the way Japanese people pick a smartphone seems to be shifting from “because everyone has one” to “is it good value for me?”

Android’s weapon: AI within reach

While the iPhone struggles against the price wall, the Android camp has started offering new value with AI as its weapon.

Samsung Electronics’ moves are especially telling.

In an interview with Reuters, Samsung co-CEO TM Roh revealed a plan to double the number of Galaxy AI devices running Google’s generative AI, Gemini, from 400 million to 800 million during 2026. He said Samsung would apply AI to all of its products and all of its services as quickly as possible, extending AI features beyond smartphones to TVs and home appliances [5].

Google itself is also speeding up on the software side with its own Pixel brand, for example by shifting its whole range of services, search engine included, toward AI Mode.

The strength of Android phones is that they can deliver an AI experience that matches, or even beats, a ¥200,000-plus iPhone across a wide range of price points.

The Pixel series offers AI-powered photo and video editing, automatic call summaries, real-time translation and more, and many phones under ¥100,000 carry the same features.

Consumers may be starting to realize that they can enjoy the latest AI features without buying a ¥200,000 iPhone.

Apple’s defense: localizing for Japan, and a “forbidden alliance”

Of course, Apple isn’t just watching this happen.

For Japan, a market unlike any other, it has rolled out a carefully tailored strategy you don’t see in other countries.

One piece of it is putting the My Number Card, Japan’s national ID card, on the iPhone.

In June 2025, working with the Japanese government, Apple launched the ability to add a My Number Card to Apple Wallet.

According to Apple, the service lets you get official certificates issued at convenience stores and access Mynaportal, the government’s online services portal, using just your iPhone. Apple says Japan is the first country outside the US to get Apple Wallet’s ID feature [6]. By working its way deep into Japan’s public services, Apple is trying to cement the iPhone’s status as an “indispensable tool.”

Next, in December of the same year, “Messages via satellite” launched in Japan for iPhone 14 and later and Apple Watch Ultra 3. Even with no cellular or Wi‑Fi coverage, you can now send and receive iMessage and SMS via satellite. According to Apple’s announcement, when you try to send a message without coverage, the device automatically connects to the nearest satellite, and you can communicate right away from the Lock Screen or the Messages app [7]. In disaster-prone Japan, this should be a real source of reassurance as an emergency lifeline in the mountains or at sea.

Even more surprising is a forbidden alliance with its rival, Google.

In January 2026, Apple announced it would adopt Google’s generative AI model, Gemini, as the AI foundation for the next-generation Siri and Apple Intelligence. According to an Impress Watch article, the partnership spans multiple years, with a plan to deliver a personalized Siri powered by Gemini within 2026 [8].

Apple has always insisted on building its own technology. Its willingness to bring in a competitor’s technology to protect the user experience on more than 2 billion devices is a symbol of how Apple, having fallen behind in developing its own AI, has resorted to a defense that leaves pride at the door.

The budget model and the gap between price and expectations

Amid rising material costs and a weak yen, Apple’s other move to hold on to share is a new strategy at the lower end of the price range.

The iPhone 16e, announced in February 2025, arrived as the cheapest model in the 16 lineup, starting at ¥99,800 (roughly $640) for 128GB [9]. But that price is about double that of the earlier SE series (¥49,280 for the second generation and ¥57,800 for the third), and only slightly below the standard iPhone 16 (¥124,800).

As the cheapest model, it seems to have sold well, but criticism that it feels overpriced keeps smoldering [10][11].

An iPhone 17e is rumored in many places, and this pricing strategy is expected to continue [12]. It may be a realistic response to high material costs and a weak yen, but it sits uneasily with what users expect from the entry model, long a pillar of the iPhone’s share.

Where is the kingdom headed?

The road for the iPhone to win back overwhelming dominance in the Japanese market looks anything but smooth.

Apple hasn’t fully shaken off the image of having missed the AI boat, and it’s hard to call it a front-runner in smart glasses or XR devices either.

On the other hand, Apple isn’t necessarily a technology pioneer. It has built markets by waiting until a technology matures and it understands what users truly want, then winning with refined design, ease of use and powerful marketing. Some believe that if Apple plays to these strengths, it still has room to make a comeback in AI and XR.

The yardstick for choosing a tool is shifting, quietly but surely, from “admiration for the brand” to “everyday practical value.” As the reason Japanese users pick up an iPhone changes from “because everyone has one” to a choice of their own, “because I need this feature,” can the kingdom regain its shine?

By the time dawn breaks, we should hear the wingbeats of some new technology again. When that happens, whose logo will be glowing in your hand?

…Owls are birds of prey, so we’re mostly meat-eaters. To be honest, I’m not that into apples.

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References

[1] MMD Labo: September 2025 smartphone OS share survey (in Japanese). Showed a reversal in share, with Android at 51.4% and iPhone at 48.3%.

[2] Selectra Japan survey / Web Tantousha Forum: iPhone prices keep rising; have they finally hit the limit? 40% are “considering switching to Android” (in Japanese). Reported that 42.7% of iPhone users are considering switching to Android because of the price increases.

[3] Rocket Mobile: [2025 latest edition] The iPhone 17 series compared: new features, performance and prices explained (in Japanese). Lists Japanese prices for the iPhone 17 series, with the Pro Max 2TB model at ¥329,800.

[4] Ameba Blog: Is an “exodus from the iPhone” quietly underway in Japan? What’s happening in the smartphone market in 2025 (in Japanese). Compares high-end iPhones topping ¥200,000 amid the weak yen and inflation with Android phones available for less than half that.

[5] Reuters: Samsung to double Google Gemini-powered devices to 800 million this year, co-CEO says (in Japanese). Samsung laid out a plan to double Gemini-powered Galaxy AI devices from 400 million to 800 million within the year.

[6] Apple Newsroom: Apple introduces My Number Card on iPhone (in Japanese). Reported that the My Number Card can now be used in Apple Wallet, with Japan the first country outside the US to get support.

[7] Apple Newsroom: Messages via satellite is now available in Japan (in Japanese). Announced that Messages via satellite is available in Japan on iPhone 14 and later and Apple Watch Ultra 3.

[8] PC Watch: Apple adopts Google’s Gemini as its AI foundation for the next-generation Siri and more (in Japanese). Reported that Apple adopted Google’s generative AI Gemini as its AI foundation under a multi-year deal to deliver a personalized Siri within 2026.

[9] Apple Newsroom: Apple debuts iPhone 16e, a powerful new member of the iPhone 16 family (in Japanese). Announced the iPhone 16e starting at ¥99,800.

[10] Yahoo! News: Criticism of the iPhone 16e, too… the truth behind its 21% share as Japan’s No. 1 smartphone in March sales (in Japanese). Explains the iPhone 16e’s sales and reputation.

[11] Toyo Keizai: So which is the right choice? The “almost Pro” iPhone 17 vs. the ¥99,800 iPhone 16e: can you feel a ¥30,000 difference? (in Japanese). Covers reviews of the iPhone 16e and complaints about it.

[12] @DIME: When will the “iPhone 17e” be released? Should you wait for the new model before buying the “16e”? (in Japanese). Predicts the iPhone 17e’s release timing and specs.