Apple has a stunning stranglehold over Gen Z — and it'll pay off for decades to come

• Apple products are super-popular among US teenagers, a new Piper Sandler survey says.
• Researchers found many teens have the iPhone and the Apple Watch — and also use Apple Pay.
• Still, Apple Music doesn't lead the way: More teens use Spotfiy, the survey says.

Apple products have a tight grip on American teenagers, new Piper Sandler research suggests.

In the investment bank's 46th semi-annual report on consumer trends of young people, researchers surveyed 9,193 US teenagers — whose average age was 15.7, with an average household income of $70,725 — to understand where teens spend their money.

Researchers found that among Gen Z, Apple rules: Out of the thousands of teenagers surveyed, 87% said they own an iPhone, and 88% of them expect the iPhone to be their next phone.

The popularity of the iPhone among teens, researchers say, may be a good sign for Apple's bottom line. After all, if nearly 90% already own an iPhone — and a similar percentage says they're going to buy one for their next phone — then that's a habit that's well-ingrained.

"These trends are encouraging as the company continues to introduce new iPhones — proving the overall stickiness of the product portfolio," the researchers said. "We think these positive trends can also be a catalyst for further services growth as well, as the install base for Apple hardware continues to grow."

And it's not just the iPhone that Gen Z is using. The report says 42% of teens were found to have used Apple Pay, the tech company's cash transfer app. And 34% of teen respondents said they own an Apple Watch.

Apple was the No. 1 watch brand among upper-income teens, according to the report, beating the likes of Casio, Garmin — and even Rolex.

Yet, when it comes to teens, there is one Apple product that's apparently not resonating: its music-streaming service.

While more than 70% of teen surveyed used Spotify to listen to music over the last six months, less than 40% of teens were found to use Apple Music, followed by YouTube Music, Amazon Prime Music, and smaller brands like Soundcloud.

Apple didn't immediately respond to Insider's request for comment before publication.

Piper Sandler's findings around teen spending trends come as Apple is slated to release new products: As of September 22, Apple has launched the highly anticipated iPhone 15 Pro and Pro Max — the company's latest version of the iPhone — which starts at a price point of $999.

However, some leaders at Apple's smartphone competitors believe that the iPhone maker has unfairly established dominance over the smartphone market.

Last year Google Senior Vice President Hiroshi Lockheimer went to X, formerly known as Twitter, to accuse Apple of "using peer pressure and bullying as a way to sell products" after The Wall Street Journal reported that some young people feel social pressure to buy iPhones over brands like Android because the iPhone's texts appear in blue.

In response to the WSJ story, Lockheimer, whose employer is behind the Android, said that "Apple's iMessage lock-in" strategy is "disingenuous for a company that has humanity and equity as a core part of its marketing."

Despite the iPhone's iron grip on young consumers, some tech experts are starting to wonder whether the rise of AI tools like OpenAI's ChatGPT— which tech leaders have called the "iPhone moment" — will be the next big thing in the tech industry as AI begins to integrate into hardware products.

Thomas Haigh, a tech historian, doesn't think that's likely — at least for the next 10 years, he previously told Insider.

"I'd give mainstream dominance of the smartphone at least another decade," he said.