Apple Inc. (NASDAQ: AAPL) will have its new iPhone X in retail stores starting Friday, and already buyers are lined up outside some stores in order to be among the first to get the new device. At a starting price of $999 for a 64 GB iPhone X, the new phone is at the top end of the price range for smartphones, and if one is going to appear in your Christmas stocking, chances are Santa will not have the cash to add a nice stack of other gifts.

That’s certainly what analysts at Morgan Stanley think is going to happen. They think that the iPhone X can vacuum up some $30 billion in U.S. discretionary spending during the fourth quarter. Macy’s has already said that consumer interest in buying the latest smartphones and other electronics has eaten into fashion budgets.

Brick-and-mortar retailers like Macy’s were already in for a tough holiday shopping season. For the first time ever, more internet users plan to purchase holiday gifts online than in department stores (59% vs. 57%), discount stores (54%), clothing and accessories stores (35%) or electronics stores (27%).

eMarketer cited the Morgan Stanley report:

We see this upgrade supercycle coupled with the very high $999 iPhone X average selling price as a significant headwind to specialty retailers and department stores in the fourth quarter. Consumers likely pull back on other discretionary purchases for a short period after such a big ticket item purchase.

The analysts noted two other points: the percentage of iPhones that are two or more generations old has hit peak levels; second, upgrade buying could continue into the first quarter of next year.

To make things worse for retailers, the supposedly slow-selling iPhone 8 and 8 Plus could soak up another $23 billion in fourth-quarter spending.

Here’s the wrinkle: Most smartphone buyers pay for their new devices on an installment plan that will put the 64 GB iPhone X’s cost at around $40 a month for 24 months. That’s not a huge drag on cash flow, especially for iPhone’s true believers. The question is will iPhone X buyers remember that they just spent $1,000 or only remember that they have added $40 to their monthly mobile phone bill? Retailers better hope it’s the latter.

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