Just how big is the iPhone? Bigger than you might think. Big enough that, according to a J.P. Morgan Chase research note quoted by the Wall Street Journal, the iPhone 5 is expected to boost the U.S.'s annualized GDP growth rate by 0.25 to 0.5 points in the fourth quarter. No, I'm not even kidding.
The research note was authored by J.P. Morgan Chase's "chief U.S. economist," Michael Feroli. According to Feroli, the iPhone 5 could cost around $200 in parts and could sell for $600 without a subsidy, which would leave Apple with a trade margin of about $400 per phone. If eight million iPhone 5 handsets are sold in the fourth quarter... well, the math speaks for itself:
The new iPhone sales could boost GDP by $3.2 billion in the fourth quarter, or $12.8 billion at an annual rate. That is an increase of 0.33 percentage point in the annualized rate of GDP growth. It could be even higher, he says. Even a third of a percentage point would limit the risk the economy would grow more slowly than J.P. Morgan's fourth-quarter growth projection of 2%.
Readers undeterred by financial jargon can check out Mr. Feroli's full research note here.
The rest of us can shake our heads, mouth agape, at the outrageousness of it all. It's no wonder gadget sites—and even major news outlets—post story after story covering the minutest leaks and most far-fetched speculation about upcoming iPhones. Apple gear is big business. Really big business.