iPhone X 'slump' is real, whisper supply chain moles Samsung has provided confirmation that iPhone X sales are way below Apple's estimates for the much-hyped, tenth anniversary special. The miscalculation could end up benefitting Android owners. News that public demand for the £999 phone was falling short of expectations came over the Christmas holidays, with Bloomberg reporting …
"Let's face it :), everyone is waiting for an edge to edge iPhone with the fingerprint reader embedded under/within the screen display"
Given the inability of an iPhone owner to NOT crack the screen (my wife dropped hers within 24 hours of me giving it to her, cases and covers were on order but apparently that 24 hour window was still time enough for her to allow it to plummet to a concretey demise), I'd like to see how that works out.
The "Essential" Android phone came out before the iPhone X and already has a small notch in the top. I haven't looked in to how well their version of Android handles it, though.
Google is adding official support for notches in the next version of Android though, apparently.
at about this time?
Perhaps (begin conspiracy theory) Samsung are getting a tad twitchy as LG has been rumoured to replace them for next years iPhones. There are also rumours that their new Galaxy S9 won't sell in the numbers that previous models have done.
(end conspiracy theory)
I'll get the popcorn in.
I agree that these companies have to examine a declining market. Is it going in the similar direction PC and other saturate sales markets are?
No one upgrading because the current tech is "good enough". If the S9 is a mere revision to the S8, then should they not expect tiny sales in comparison?
The iPhone X and 8 are somewhat silly and small adaptations, not "upgrade" worthy in most peoples experience. If I wanted the "full screen" effect of the X, I'd want it to give me a bigger screen, not reduce that screen with a notch. If I wanted a faster/better phone, I'd wait till the old one breaks/wears out, and currently the tech can last ages as specs/manufacturing is rather mature now.
If I wanted to use Apple's excellent AR silicon, I'd wait til they make a model with rear-facing active 3D scanning.
Other note: LG's OLED phone screens haven't been universally praised this last year -- see Google Pixel. LG's TVs are superb, but they use a different substrate.
>> "No one upgrading because the current tech is "good enough"."
Fully agree, but I'd also add that on top of existing tech being good enough, the added problem is that the replacements are getting so darned expensive. Hence, replace a fast, fluid and fully working phone with one that's only slightly faster and flashier for $1,000?? Easy to see why more and more people are saying "No" to this.
And to note, Samsung are getting there as well. Last time I was due an upgrade, I did look at a new Samsung phone, but balked at the price before sticking with my existing handset.
Why put a notch in an OLED? Curved corners on the OLED are bad enough, but at least form factor dependant. However, why have a notch when two bars serve just as well?
Or to put it more precisely, if you want "all screen" but are technology limited to cameras taking out some of the OLED real estate then don't put full screen video inside the notch. Just put it within the notch, as like 100% of previous video systems have done with letterbox/etc screen options.
I just see this phone (and similar ones) as an insane Emperors New Clothes, waiting to collapse under their own steam and hot air.
So while I know my little "rant" is a bit off topic, it is my feeling of the market direction, and the break between the sales/marketing and the consumer/market.
I agree with John and disagree with Dave. The X has less space for notifications, and it's not just used for that, they want to use it for the address bar/websites/full screen video! That's less than having a Samsung or any other phone square screen!
How on earth is a Notch an improvement and not a detraction? In cost, use, information, reparability, ease of use... in everything?!
Not since the iPhone 1* have I seen such a cut down usability from Apple! Every phone after that has been an upgrade. But the X is cutting of the nose to spite the face.
*No copy paste, no removable battery.
Status bar information is the important stuff - battery life, signal strength, clock etc - that needs to be read easily. Adding icons for less important stuff is poor Information Ergonomics, since in effect lower priority information is being elevated to the same status - visually - as important stuff. In addition, the icons don't need to be high resolution. If a notch is cut for a standard camera, you might only be able to fit in say 14 status icons compared to 15 on an uncut screen.
My point is that if a front facing camera must be fitted to a phone, the area to the sides of the camera might as well be used to display critical status information. The concept is sound in principle. This auxiliary dispkay area *does not* need to be a part of the main display, and might use a display technology with its own advantages (eg low power e-ink or OLED) when the main display uses a different technology.
However, fitting another component has its own cost implications - though probably not as high as cutting a notch *at this time* (though in future I don't know - the OLED does need to be cut from a larger sheet anyway, it become one process but with an ever so slightly longer tool path)
As for full video, most content is 16:9 but the ergonomics of holding a phone and reading websites are pulling phone screens towards 2:1 (aka 18:9) - any notch area isn't being used for video anyway.
For IOS - which only has battery and signal strength at the top of the screen this is true.
For Android, which has a notifications bar at the top of the screen it is wrong. And the notifications are more useful than a 3D face scanner to me and I guess to most people.
And the Android notifications system is one of the biggest elements that make Android superior to IOS, for those or us who prefer it.
Currently at the top of my screen is:
Time
Battery Strength
Wifi Indicator
Alarm icon
Bluetooth Indicator
Plus notifications for email, unread messages and notes.
These would not all fit in the corners beside the iPhone X notch.
Of course, to Apple zealots, any feature that their beloved phones does not have is stupid, wrong, unnecessary - until Apple decide to copy it.
"Doing so offers a clear usability benefit over otherwise wasted space."
This is not clear to me at all. In a sense, it's connected to this trend of phone manufacturers to try and be "bezel-less" -- which is, in my opinion, misguided. The assumption that any space that isn't used to display something is "wasted space" strikes me as a bit dubious, not unlike saying that white space is "wasted space".
As said. I have no problem with a notch if used only for notifications. But using it for full screen video/web content means you loose the notifications and damage the user experience to full screen content.
Just use letterbox/pill box. Why are Apple (and some Android distributors) using notches the wrong way?
"Adding icons for less important stuff is poor Information Ergonomics"
Agreed. But who decides what counts as "less important"? I argue that only the user of the device can make that determination. Every icon on that line on my phone is very important (absolutely more important than a notch for a camera!), or it wouldn't be there.
"The top of most phone screens just display a few simple icons most of the time - no reason not to share that space with a camera. The issue is implementation - LG made a phone with a discrete screen next the camera, not a bad idea."
If you only think the notch blocked only 'the top of most phone' and a few simple icons most of the time, then you clearly haven't tried rotating it and used it for other things. Unless you watch movies with one eye blinded, the notch extremely stands out with the asymmetric in landscape mode.
Sure apple fans can 'compensate' for the difficulty. But no matter how you flip it horizontally to the right or the left, it will still be asymmetrical.
Are losing their grip.
Let's face it .... after spending all their money on Starbucks latte, craft beer and beard oil, all these hipsters don't have a thousand pounds to spend on a mid range handset with a stupid notch.
Mind you modern art can be twisted to suit any agenda and that's what Apple tried with the notch. not sure they have succeeded this time.
An interesting test for any Apple product these days is "would Steve Jobs have let this see the light of day?".
Looking at the notched screen, the poo emoji, the $1,000 price tag, and vast proliferation of iPhone models I think I can safely conclude the answer is "no".
This is what happens when you put some spreadsheet-head in the position of being the creative leader of a successful business. Cook should have that poo emoji engraved on his tombstone.
> You know a company has ran out of "innovative ideas" when the advert they use to sell this phone is of a blonde girl singing something, and showing how her face can be used to animate a shit.
If you're unaware of how much teenage girls and young women use their phones on an hourly basis compared to the rest of us, I would not employ you to sell phones.
>If you're unaware of how much teenage girls and young women use their phones on an hourly basis compared to the rest of us
I'm a parent of several - mostly iPhone5 owners - no interest (or chance since I'd be paying) in the latest or greatest - probably a refurb 6 or equivalent Android later this year. They'd have a 1000 better uses for that £1000 price tag too - phones are important, which phone Apple/Android/Whatever (within reason) is pretty much irrelevant.
If Apple are relying on young women to buy iPhone X they've totally lost the plot - it's a male orientated company with male orientated products in any case.
I don't think that Apple is especially male-orientated? Personally, of my friends who have iPhones, more are female than male, and similarly I have a few female friends who are big Mac fans (as opposed to just grudging computer users in general). The ease of use/software maintenance, phone syncing and general aesthetics are important factors for them (perhaps more stereotypically female, although these reasons are equally important for me, as well!).
>I don't think that Apple is especially male-orientated?
Less than 30% of their leadership is female - I'm sure there are worse companies and there will be a stream of whataboutism - but however you cut it, when over 70% of Apple's leadership is male, it's going to be a male orientated company.
"If you're unaware of how much teenage girls and young women use their phones on an hourly basis compared to the rest of us, I would not employ you to sell phones."
Fairly sure the teenage-to-twenty-something-girl market has not been crying out for the opportunity to easily make their face look like a shit.
"If you're unaware of how much teenage girls and young women use their phones on an hourly basis compared to the rest of us, I would not employ you to sell phones."
Nor would I employ anyone to sell phones were they unaware of what fraction of teenage girls have $1k to drop on a new phone.
Profit.
The iPhone has one of the highest mark-ups of any phone.
Apple sell only 1/3rd to 1/2th the amount of phones as their next nearest rival (Samsung and Huawei actually own the market in terms of unit numbers).
However, they make MORE PROFIT from selling that lesser amount of than anyone else (Samsung and Huawei make much less money than Apple).
I would assume, however, that Samsung make a tidy profit on NOT making screens up to the expected order numbers. You can't just order 30 million and then only buy 20 million, so presumably they've made some money from Apple by doing nothing.
"You can't just order 30 million and then only buy 20 million, so presumably they've made some money from Apple by doing nothing."
Presumably Samsung didn't whip up 30 million screens and shove them into a warehouse for when Apple was ready. It's a production line. They can stop the run when they get to 20E6 rather than 30E6. And given it's Apple, they may well be able to cut the order on a whim. (And Samsung may well be able to do the same to their supplies.)
And given it's Apple, they may well be able to cut the order on a whim. (And Samsung may well be able to do the same to their supplies.)
Well, the buck stops somewhere. Not everybody has the power to say "contract your order, then take or pay!". Samsung might have that muscle, in which case Apple have to pay up. But Samsung's suppliers probably don't and they wouldn't get the moolah - even if Apple had to pay Samsung for ordered and cancelled screens.
They can stop the run when they get to 20E6 rather than 30E6.
That's true, but the price agreed will have been based on a volume number, because so much of the average costs are volume dependent. If production is lower than the estimates, the fixed costs have to be recovered over smaller volumes. If the production volume is the same, but the rate of production is reduced, then the variable costs increase.
Profit come from the lock-in. Very few free apps on iOS, and apple get a tasty cut of the sale price. They get repeat purchases and their cut for the buy again tablet version of the same app. Android is a million miles away, for every pay app, there is usually a free one, often as good, or better, its pretty rare if you buy an app, you will be stitched into buying again for tablet. (Its possible to have two versions and lock out phones and tablets, but its not user friendly and likely to result in you being a 1 star review hero)
Seems like a lot for distribution, marketing etc...
The bulk of it is profit which is why Apple has such stellar results in comparison with other phone makers. So even when the numbers disappoint it's still minting it.
Seeing as Apple also switched to OLED for the Apple Galaxy 8 I'm not so sure that Samsung is going to be left sitting on 30 million odd screens even if it didn't have some kind of penalty clause. If the stupid notch fails, Apple will just move on with the slightly tweaked Galaxy X + in the autumn. The aura will be briefly diminished but as long they can keep selling millions of whatever at their current margins, they're laughing.
I was very tempted by an 8 Plus until last week. I'm seriously impressed by its camera, but being on holiday I pulled my premium compact camera - Lumux LX 7 - out of its drawer and fell in love with it again. At the same time, I tried placing the iPhone 8 Plus of my travelling companion in my trouser pocket and fuck me it's heavy and large. Damned fine camera and image processing though - in all but dimly lit scenes it competes favourably with the Lumix.
So, it's a OnePlus 5T for me when I get back to Blighty (and Lumix in jacket pocket more regularly), and this poor Nexus 5 will be put out to pasture.
Heck, might even nab a Sony RX200 MK II or Lumix LX 100... £500 buys a shit load of very good pocket camera these days. Those improvements we've seen in tiny phone camera sensors? They scale.
I'd like a note 8, stuff like the S pen can transform what we can do with a phone but that the price they are it's just insane, particularly as they don't have an easily replaceable battery. I think people are looking at the X in the same way. Nice phone but at that price, I'll wait a year an see.
Don't think numbers. Think percentages.
That's a 1/3rd drop in expected sales. That's quite a hefty hit for any company. Changing your plans for your new product to only sell 2/3rds of what you expected? That's gonna hurt any company and Apple are fortunate enough to be able to absorb a $10bn loss without flinching.
(By overcharging for every product they've ever made, and stashing their money abroad outside of the reach of taxation authorities, but hey... I'm not judging... no, wait, yes I am).
"Apple are fortunate enough to be able to absorb a $10bn loss without flinching"
Apple are also comfortably in a position to continue selling the current iPhX -- dropping the price (i.e. the margin, effectively), step-wise, by increments, on a schedule, to clear out all stock, keeping the upstream production lines humming, and exhausting any current 'over-production' of screens. It makes some sense to do so; some profit is better than none, even if it isn't the 'usual' profit. And, of course, doing so would create a bit of buzz. Arguably, it is also a way they can get larger numbers than otherwise would -- at current prices -- to upgrade. (A Windows 10 move, with carrot, rather than stick). Much depends, though, on what's in the pipeline for new features, chips, etc..
I'm not convinced they can do that. The entire point of the X was that it's an expensive luxury - much like a Rolex, Apple's brand is based on "reassuringly expensive".
Aside from that, if they drop the price of the X then they'll cannibalize the next model down which seems to have larger margins.
Probably better to cancel the X.
Thin margins on their flagships? What are you smoking? The S8 cost $301 to make according to IHS, their margins aren't all that different than Apple's and certainly aren't "thin" by anyone's definition!
The reason Samsung's overall smartphone margins aren't nearly where Apple's are is because most of their sales are much lower priced and have much lower margins.
This -> http://www.alphr.com/samsung/1008532/samsung-galaxy-s9-lose-half-value
'predicts'... that a few months time the S9 would be worth peanuts.
That will his the Samsung mobile division hard. At the moment, Samsungs profits are largely coming from its semiconductor business and not the phone division.
I'm sure it will all come out in the wash but be careful shorting APPL. It might backfire on you.
that a few months time the S9 would be worth peanuts
So what? Other than burglars and robbers cashing in at BREX*, nobody sells their flash new phone a few months into a pricey contract. For regular owners, after two years, the next shiney is on offer, and they happily take whatever they can get on Ebay, or palm the device off on a family member.
* You know who I mean.
I suppose they could sell them to Chinese companies that want to create iPhone knockoffs, unless they are shipped without the notch... Even if they are the Android OEMs would have to come up with a new design to use that exact sized screen. If true I guess there should be more options for Android OLED phones in about six months, so long as you are OK with a screen with the exact size and resolution of an iPhone X!
Besides, rumor has it Apple is going to offer an identically sized iPhone next fall, alongside a larger OLED model. Couldn't they just stockpile the screens to fulfill Apple's fall order? Unless there will be something different about that screen next fall, I don't see why not.
I doubt they think it's a great idea. That's a clone.
There are a lot of OEMs in China making rough clones of every well-known brand in every industry. Have been for years.
For a while it was a bad joke that someone would turn up at tradeshows, take a few hundred photos and within a few weeks then produce something that looked the same - but didn't work anything like the original.
These days some of the clone phones are pretty good. Not the same, but certainly adequate.
Random search found a phone with a rather similar looking screen. Obviously not the same one form out back of the factory for that price...
https://www.geekbuying.com/item/OUKITEL-U18-5-85-Inch-4GB-64GB-Smartphone-Black-392736.html
They even copied the notch. Funnier is one of their quoted reviews:
We do not know if any other company will launch a mobile of this type soon, but it seems that Oukitel will take the cat to the water in terms of speed
Is this a new definition of "furiously" quick?
"I suppose they could sell them to Chinese companies that want to create iPhone knockoffs, unless they are shipped without the notch..."
Samsung aren't sitting on 20 million notched OLEDs. They're sitting on unused production capacity for 20 million OLEDs. That's a key difference, which means it's relatively easy for them to convert the capacity to produce a non-notched version to shop around to 'Droid makers.
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I've still not joined the smartphone bandwagon - initially I couldn't justify one on the basis of price, then in the intervening years I've acquired netbooks, MP3 players, cameras and GPS units, so I don't really have a use case for one now.
My current phone is an 8 year old Samsung Ch@t 335 inherited from my wife, and it does more than I need as it is, plus the battery (original) still lasts 10 days between charges. I might eventually get something I can install LineageOS/Copperhead/Replicant on, if I really have to.
Time after time the mantra has been 750 x 1334 screens are more than you really need.
So what with the notch,the ultra fragile glass, the missing headphone socket they prefer to cut costs and buy the same. Lucky for Apple the same might beva 7 or an 8, not that Xcentric iPhone.
"Samsung has provided confirmation that iPhone X sales are way below Apple's estimates"
Oh, and that's supposed to be a reliable source? I small another Samsung rat.
A quick web search on sales of iPhone X shows a lot of stories late 2017 saying sales were disappointing, but most 2018 stories showing sales are good. Just pick the story you want to believe.
But beware of comments from Samsung. And since they seem to be supplying the screen to Apple, comment on this would be highly unethical if not illegal, even if it were true.
It just doesn't add up.
As AppleInsider wrote: "Apple has previously sold 50-60 million iPhones in total in its January quarter. Imagine launching three new flagship iPhones at the highest prices ever asked, while also introducing the widest array of new, cheaper options, and then "envisaging" that the vast majority of customers would all buy just one of those models: the most expensive iPhone X."
No way was the order for 45-50 million panels in the January 2018 quarter.
Maybe the order was for 20 million and Samsung thought they would over-produce / made a gamble.
There are too many 'unnamed sources' in these articles - the numbers just don't add up. It sounds like a story is being spun - and there is enough being hidden to make it impossible to tell why this story is being spun (an attempt to undermine Apple by Samsung - both a key supplier and a rival?).
But The Register repeating it all verbatim without any analysis or critical thinking is poor journalism.
"Imagine launching three new flagship iPhones at the highest prices ever asked, while also introducing the widest array of new, cheaper options, and then "envisaging" that the vast majority of customers would all buy just one of those models: the most expensive iPhone X."
No, this does sound pretty much like Apple's whole business model.
Regardless of your feelings on Apple, I think £1000 (or £1150) is simply too much money for a phone. I spent about £700 on a 49 inch 4K TV which will (hopefully) last me for a good 5-10 years. Phones are easily broken or lost/stolen and typically are designed to last a couple of years (appreciate it can be more if you are careful!).
I bought the big model... used it a week and now it’s my spare phone for travel.
It was my first attempt at an iPhone without a headphone jack. What a f-ing joke. Constantly charging phones and headphone when I went wireless. Went back to wired and could charge the phone while listening. Of course I could buy a splitter or a wireless charger. But what a frigging horrible experience it’s been.
The usability on the iPhone X is a disaster as well. It was as if they put absolutely no thought into the phone. They even made it so the frigging power switch was more than the power switch now. So every time you try to turn the phone off it does other crap instead.
I would return it, but I needed a travel phone anyway. So why bother? Back to my iPhone 6S plus. I’m in the states now and will stop by the Apple store and get a battery replacement today.
Perhaps the phone market is just plateauing in terms of features, but I'm not seeng any phone that I am rushing out to buy as my 'must have'. I have an iPhone 7+ and a Nexus 6P and I quite happy with them and see nothing that's convincing me that I need to upgrade.
A few years ago, display technology was changing very rapidly, screen sizes were increasing and there were all sorts of innovative camera features that actually made a difference.
On top-of-the-market phones, you just expect and get fantastic displays, really good audio, processors that can do most of what you want them to do, etc etc.
I really think this is the point where you'll get a lag as the products don't offer anything amazingly compelling to upgrade. There needs to be some kind of major breakthrough on battery and charging technology, beyond just rapid charge, or something like that before I would jump to an upgrade.
Otherwise, you're really just looking at incremental processor upgrades and natural produce lifecycles as they fail after a few years.
BOM to Launch RRP
Apple
$225 to $649 (i7) or 65% markup
$278 to $769 (i7+) or 64% markup
$255 to $699 (i8) or 64% markup
$288 to $799 (i8+) or 64% markup
$370 to $999 (iX) or 63% markup
Samsung
$258 to $750 (S7) or 66% markup
$265 to $769 (S7E) or 66% markup
$301 to $720 (S8) or 58% markup
$325* to $790(S8+) or 58% markup
$350 to $929 (Note8) or 62% markup
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