Apple Inc. (NASDAQ:AAPL) would much rather you think about the iPhone 7. However, the company has been busy over the past several days tidying up some issues relating to the iPhone 6 and iPhone 6s.
AAPL announced two repair programs — one dealing with the infamous Touch Disease issue — and has apparently tracked down the cause of a flurry of iPhone 6 phones dying in China.
In most cases, getting those iPhone 6 series phones fixed is going to cost you. And China? That’s shaping up to be a problem.
iPhone 6 Plus Touch Disease Repair
On Friday, AAPL finally admitted to the existence of Touch Disease — the name given to an issue affecting a significant number of iPhone 6 Plus phones. The affected iPhones suffered flickering displays before ultimately refusing to respond to touch control. Third-party investigators placed the blame on a design flaw that allowed the large iPhone’s logic board to flex, eventually breaking critical circuitry.
“Apple’s new Multi-Touch Repair Program addresses this issue. However, the company puts the blame squarely on users, saying: “Apple has determined that some iPhone 6 Plus devices may exhibit display flickering or Multi-Touch issues after being dropped multiple times on a hard surface and then incurring further stress on the device.”
As a result, the Touch Disease repair will set owners of affected iPhone 6 Plus phones back $149.
iPhone 6s Battery Replacement
On the weekend, AAPL also announced a repair program for iPhone 6s phones that were unexpectedly shutting down. The company blames this one on a battery defect specific to phones manufactured between September and October 2015.
Owners of an iPhone 6s that repeatedly shuts down without warning can bring their phone to an Apple store and if is determined to an affected model, they get a battery replacement for free. AAPL does note that if an affected iPhone 6s is suffering any other damage such as a cracked screen, that damage has to be repaired first — which is likely to result in a fee — before it will install that free battery.
China’s Dead iPhone 6 Problem
Another iPhone 6 problem has slowly been gathering steam, this time in China. There have been a growing number of complaints that the iPhone 6 and iPhone 6s would report a 50% battery level, then unexpectedly shut down.
Even more alarmingly, some of these affected devices would then refuse to power on altogether.
With AAPL facing declining iPhone sales in a country that it has looked to for growth, the potential for a fatal design flaw was alarming. The odd thing is the fact that the issue seemed limited to China. It was not Touch Disease and the number of iPhones involved seems to fall outside the very limited run of iPhone 6s phones identified under the new battery replacement program.
AppleInsider reported today that a preliminary investigation is pointing to cheap third party power adapters sold in China as being the culprit. Its sources said that “exactly 100%” of the affected iPhones that have been examined to date were primarily charged using non-Apple chargers.
The report also claims that these knock-off chargers (which Apple has repeatedly warned against using for years) physically damage the charging circuits on the iPhone itself, so a battery replacement isn’t a cure. The entire motherboard needs to be replaced.
That leaves owners facing an out-of-warranty repair in the $299 range.
Impact on Apple
While it’s not as bad as the negative press and massive recall costs rival Samsung (OTCMKTS:SSNLF) has faced with its Galaxy Note 7, the iPhone 6 issues aren’t helping Apple’s image. Touch Disease in particular has tarnished the company’s design reputation and comes on top of complaints about the new MacBook Pro missing the mark.
If AAPL can escape without the iPhone 7 suffering any critical flaws, then rally with the iPhone 8, any PR damage caused by the iPhone 6 generation should be forgotten.
The bigger problem is likely to be China. If you’re AAPL, what do you do for owners who have essentially killed their iPhone 6 with a non-approved, third-party charger that you specifically warned against? At $299 for a repair, they’re just as likely to buy a next-generation phone from Huawei instead, further eroding market share. Replacing the phone for free means a big hit. And with so many of these chargers circulating (they can cost 50-cents compared to the $19 Apple charges), any replacement program is liable to be massive and doesn’t address the root issue of the knock-off chargers.
With the Chinese Consumer Association officially involved, Apple is under pressure to do something. The questions are: What, how much will it cost the company and will it help or further erode iPhone sales in China?
As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.
