Apple business plan
Sell less and less, even more expensive devices to fewer and fewer rich people.
People participating in the so-called gilets jaunes* populist protests in France looted an Apple Store in Bordeaux earlier this month – taking care to snaffle the high-tech bling before trashing the place. It must dismay the iGiant's CEO, Tim Cook, to discover that Cupertino's stores are held in about as much esteem as …
The trouble is that it's a hard strategy to argue against, whilst it's working financially. It doesn't have to work forever, just long enough for the man responsible to be able to retire with a net positive impact on the company's figures. A total collapse afterwards is somebody else's problem, provided he's sold all his stocks by that time...
The increasing services revenue ought to be a wake up call. You can't make money from services if no one is buying the phones through which those services are delivered.
You said:
if no one is buying the phones through which those services are delivered.
And the article says:
Consider how more relatively useful an old iPhone is today, as I noted last week (this was not an ironic piece: Apple did the right thing by forgetting to include built-in obsolescence), and that's reminding everyone to keep old iPhones longer.
This leaves Apple with only two methods for shifting new iPhones:
(a) _God forbid!_ decrease prices
or
(b) enforce obsolescence.
The latter worked and successfully killed off the iPhone 3GS with iOS 6, iPhone 4 with iOS 7, and iPhone 4S/iPad 2 with iOS 8 and 9.
(And was about to kill iPhones between 6 and 7 with iOS 11.0 but people objecting do actually have a point when they say that it's the battery depletion that mandated such a measure)
And the author thinks that Apple are NOT forcing obsolescence AND Apple are not dropping prices. One I'd these statements has to be false.
My ancient Ipad 2 is chugging along just fine, while being used daily. Okay, it's primitive by today's standards but it works fine for surfing, and my admiration of its durability increases with every year that goes by. I do have a folding cover and a stick-on screen film for it that's as old as it is, but still.
yes and no. high margin low volume is the lifeblood of aspirational luxury brands like Hermes or Louis Vuitton.
but if you look at cars, most of the luxury brands are parts of consortiums now.
the difference is that old style luxuries do not require heavy R&D nor benefit greatly from economies of scale.
Apple can choose to sell exclusively to the 1% (ok, 10-15%) but its fixed R&D costs would then be spread on too few units.
to be able to innovate they need volume. selling lots of phones cheap in India is however not without branding risks and would not necessarily result in much profit either. even if investors want to hear it.
i suspect they will have to find ways to deliver better value to midlevel consumers at some point. but that is somewhat complicated by their products’ relatively long lifetime. media-wise they seem expensive and locked-in and, to me, deliver less value than in hardware. apps are good, but bound to hit saturation on existing users
tough having to justify valuation of $100/human.
In the early 90's Apple was getting its lunch eaten by Microsoft, specifically on the lower end. So Apple focused on the high-end market but steadily losing market share. By the mid-nineties, the company was a shadow of its former self - down to the point they accepted a financial lifebuoy from Microsoft. I see the same thing happening now with their iPhone strategy.
"I see the same thing happening now with their iPhone strategy."
.... except this time I don;t think that Google will suddenly show up at an Apple Launch to announce that they'll guarantee future support for Google Apps on iOS as they know what happened when BillG took pity on the floundering Apple.
to be fair its fairly shit macOS 8.x didn’t help either. they’d failed, twice, at creating a new one (Taligent and Copland) and by then the poor thing was really showing its age to anyone else than the most uncritical fans or specialized industries.
i recall a Word resume-printing session with about half a dozen bomb icons in 30 mins.
would usually expect to see a rush of the appleatsi all telling us how good the product is and that the price merely reflects this ...........
maybe, just maybe, Apple have actually started to price out their biggest supporters ?
and that isn't going to help, if you have a mediocre range and a sky high price, then every little bit of positive print helps
ME ? I have an MS phone .............. so what do I know :o)
due for replacement as of the 19th December, and as MS have decided to ditch all of their clients, I am left looking at Android - price alone sets Apple out of the basket - but I have only ever used windows smart phones, and so will need to re-train myself into a different OS, but at least Mr Cook's market plan means I only have to think about one OS :oP
I used to love Apple, Macs, specifically. Having to work with terrible Dells, with tiny trackpads, crummy software loaded on XP, cheap build quality and just an overall air of 'eh, this will do', it was a pleasure using a Mac instead. The ascthetic of the mac pleased me every time I noticed it.
Not so much nowadays. I am totally indifferent to them. I am typing this on a MacBook pro, but only because it is closer to hand than my thinkpad. The build quality is excellent, and I don't care about the price anyway, as work pays for them, but my thinkpad is also excellent, and while the touchpad isn't as good, the keyboard is better
I keep watching youtube videos about how you can use the iPad pro as your main daily driver. But they all focus on editing video. What about software development? I would love to run Apache / Sublime etc on an iPad. I can't see what Apple is doing which will impress developers. Maybe we don't matter anymore?
Apple need to address some pretty big things with iOS before it can be used for development.
1. Access to local drives.
2. Access to local network.
3. Transfer data between apps in a less clunky way.
4. Compile and run arbitrary unsigned code.
In short, Mr. Cook, tear down this wall.
But it's not going to happen, as it would mean less money from the App Store.
TBF you can run your own code - on your own machine, but I suspect their later problem (as they see it) is that despite problems with vetting Apple's service, for many (maybe most) people, the even less well regulated world of the Google store is worse.
Maybe the time has come for an independent auditing organisation that takes a lower percentage and pdes a better jb than Apple - it would not be anti competitive
I wonder if part of the high price for the newer products was so they could "absorb" the tariff if they did go to 25%. Of course it could just be price gouging or even something else. Apple has made some very odd decisions lately like not allowing removable storage in the mac mini to be removed even though there appears to be pads on the motherboard for connector for an high speed add on board. A simple option would have made the machines much friendlier for companies that have security compliance issues.
When you have so many buyers, you don't need a lot of margin for that to be a big thing. When you have such a large market with customers who will show their devices to others, you have a chance to become a brand that is popular across that market. This is how certain areas get a surprising distribution of a specific brand, and the phone manufacturers would not mind at all being that brand across India or some areas therein.
I don't think this is an apple-only issue.
All that QE (printing money) governments were doing is coming home to roost. I noticed my shampoo manufacturer dropped from one litre to 300ml (2/3rds) and dropped the price by 1/3rd.
There is/was a problem in the financial markets which governments liked to pretend wouldn't have many consequences. The governments didn't bail out the subprime mortgage companies, we did. And we have to pay for it.