Apple sales team concerned about shrinking high-end iPhone market, but Schiller disagrees

Posted:
in iPhone edited April 2014
An internal Apple document presented as part of the ongoing Samsung v. Apple trial shows that the company's sales team was worried that a maturing market may leave no room for iPhone growth, though marketing chief Phil Schiller downplayed the document's significance.

Schiller


"Competitors have drastically improved their hardware and in some cases their ecosystems," one Apple employee wrote, expressing concern that such growth would result in fewer customers for the iPhone. The document was introduced at trial by Samsung and its contents reported by Re/code.

Smartphone growth, the document argued, was in sectors that Apple had chosen to ignore but competitors had jumped in to fill -- namely, low-end devices and handsets with large displays. Additionally, carriers were though to be balking at increasing the mix of iPhones in their smartphone sales because of the devices' high subsidies.

The document, prepared for an offsite Apple sales meeting, went on to call out rivals' "obscene" spending on advertising and carrier partnerships to reinforce its point. Samsung, Apple's biggest competitor, spent some $14 billion on advertising in 2013 compared to Apple's relatively modest $1 billion.

Schiller, the executive in charge of Apple's worldwide marketing efforts, said during cross-examination that he does not entirely agree with the views presented in the document. Further, he added, it does not represent Apple's official position.

Schiller does have solid statistical footing on which to base his disagreement. The flagship iPhone 5s, with a 4-inch display and an off-contract price of more than $600, has been the best-selling smartphone in the U.S. each month since its release.
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Comments

  • Reply 1 of 42
    radnukerradnuker Posts: 12member
    Samsung is play a game of distraction trying to throw the jury off the simple fact that they infringed on the patents in question. The patents should be what this trial is about.
  • Reply 2 of 42
    snovasnova Posts: 1,281member

    seems like Samsung knows its going to lose and presenting evidence which has no bearing what so ever on winning the trial. Maybe they see this as free advertising or a way to hurt Apple somehow by mocking them.  When you spend 16 billon on ads, making most out of losing 2 billion this trial seems like a good way to promote Samsung and hurt Apple in the process.

  • Reply 3 of 42
    radnuker wrote: »
    Samsung is play a game of distraction trying to throw the jury off the simple fact that they infringed on the patents in question. The patents should be what this trial is about.

    http://en.m.wikipedia.org/wiki/Chewbacca_defense
  • Reply 4 of 42
    snova wrote: »
    seems like Samsung knows its going to lose and presenting evidence which has no bearing what so ever on winning the trial. Maybe they see this as free advertising or a way to hurt Apple somehow by mocking them.  When you spend 16 billon on ads, making most out of losing 2 billion this trial seems like a good way to promote Samsung and hurt Apple in the process.

    It's an opportunity to advertise free. Whatever they say at this trial will be repeated free by the tech media. So they're putting on a show. For us, not just the jury.
  • Reply 5 of 42
    radnukerradnuker Posts: 12member

    Chewbacca defense. That's hilarious! I had totally forgotten about that!

     

    Nice!

  • Reply 6 of 42
    rogifanrogifan Posts: 10,669member
    radnuker wrote: »
    Samsung is play a game of distraction trying to throw the jury off the simple fact that they infringed on the patents in question. The patents should be what this trial is about.

    Yeah I was wondering where Samsung is going with this. Unless they're trying to show that it's not about patent infringement but Apple wanting to stop a competitor they were afraid of? Clearly it's BS but getting the jury off track might work for them. Especially if the judge is eager to get this trial over with.
  • Reply 7 of 42
    snovasnova Posts: 1,281member
    Quote:
    Originally Posted by Rogifan View Post

     
    Quote:
    Originally Posted by radnuker View Post



    Samsung is play a game of distraction trying to throw the jury off the simple fact that they infringed on the patents in question. The patents should be what this trial is about.




    Yeah I was wondering where Samsung is going with this. Unless they're trying to show that it's not about patent infringement but Apple wanting to stop a competitor they were afraid of? Clearly it's BS but getting the jury off track might work for them. Especially if the judge is eager to get this trial over with.

    kind of hurts their efforts to show that the patents were not worth much when you compare it to what they are trying to say in this side show.  Pick an angle Samsung and stick to it.  If you are trying to show that you really hurt Apple because you are powerful with consumers then its hurts your "the patents are not worth much" argument.

  • Reply 8 of 42
    tastowetastowe Posts: 108member
    I don't understand dumb customers are buy cheap crappy plastics android phones. I don't to buy any cheap crappy plastic android phones because I want a beautiful sexy iPhone hardware instead plastics phones. The android phones are not beautiful sexy phones
  • Reply 9 of 42

    Apple patent trolls Samsung. So Samsung is trolling in court

  • Reply 10 of 42
    dasanman69dasanman69 Posts: 13,001member
    tastowe wrote: »
    I don't understand dumb customers are buy cheap crappy plastics android phones. I don't to buy any cheap crappy plastic android phones because I want a beautiful sexy iPhone hardware instead plastics phones. The android phones are not beautiful sexy phones

    Who can compete with such highly evolved reasoning?
  • Reply 11 of 42
    " Unless they're trying to show that it's not about patent infringement but Apple wanting to stop a competitor they were afraid of?"

    Yes. That is exactly Samsung's case.

    "Especially if the judge is eager to get this trial over with."

    Why wouldn't the judge be eager? To put it another way, what is it that Apple wants exactly?

    A) To stop Samsung from selling phones and tablets? Not going to happen.
    B) To impose such high fees that it will stop Samsung from selling comparable products at cheaper prices? Not going to happen.
    C) To use an infringement verdict against Samsung as basis for going after Google and Android itself in order to use the courts to eliminate the competition entirely?
    Well, when Samsung brought this up, Apple protested loudly (too loudly perhaps?) but if that isn't the real strategy, what is?
    Steve Jobs: %u201CI'm going to destroy Android, because it's a stolen product. I'm willing to go thermonuclear war on this.%u201D

    At this point, with dozens of manufacturers making thousands of Android products worldwide, the genie is not going to be put back into the bottle. Apple can either enter into licensing agreements with Android manufacturers - as Microsoft has done, and Microsoft now makes money off 55% of Android devices sold and is also seeking those same agreements from companies that make the other 45% - or simply beat them in the marketplace. (And incidentally, it is doing precisely that.)

    Apple won some early victories, but at this point the courts are not going to ban Android, nor are they going to make Android too economically impractical to sell by charging some massive penalty fee for each device manufactured. If Apple keeps tilting at legal windmills while Android manufacturers like Amazon, Samsung, Google and HTC keep introducing new products (not groundbreaking gamechangers, true, but stuff capable of moving the needle like phablets, Chromecast, wearables and now Fire TV) along with Microsoft finally emerging from the Ballmer malaise swinging, you can't blame analysists for looking at companies other than Apple when pondering where the action is.
  • Reply 12 of 42
    cpsrocpsro Posts: 2,896member
    Quote:

    Originally Posted by Suddenly Newton View Post



    It's an opportunity to advertise free. Whatever they say at this trial will be repeated free by the tech media. 

    Not free! Samsung has spent $billions greasing the media for this. Apple? not so much.

  • Reply 13 of 42
    cpsrocpsro Posts: 2,896member
    Quote:

    Originally Posted by mensmovement View Post



    At this point, with dozens of manufacturers making thousands of Android products worldwide, the genie is not going to be put back into the bottle.

    You might be surprised at the magnitude of the effect within the little ol'U.S.A. of a verdict that's strongly in Apple's favor.

  • Reply 14 of 42
    gwydiongwydion Posts: 1,083member
    Quote:

    Originally Posted by Cpsro View Post

     

    You might be surprised at the magnitude of the effect within the little ol'U.S.A. of a verdict that's strongly in Apple's favor.


    Lat trial outcome didn't had so much effect in ol'USA, why do you think this new trial will change that?

  • Reply 15 of 42

    Apple outsells Samsung at the high end by over 2:1 (Galaxy S and variants hit 200 million recently according to Samsung's own announcement while iPhone sales over the exact same time period as the Galaxy was 430 million).

     

    Samsung is a distant second place to Apple and 3rd, 4th and 5th are so far behind they're hardly even relevant.

     

    I don't see how anyone could assume that Apple is "concerned" considering the sales numbers they're consistently putting up.

  • Reply 16 of 42
    pmzpmz Posts: 3,433member
    Quote:

    Originally Posted by AppleInsider View Post



    Schiller does have solid statistical footing on which to base his disagreement. The flagship iPhone 5s, with a 4-inch display and an off-contract price of more than $600, has been the best-selling smartphone in the U.S. each month since its release.

     

    ...I rest my case.

  • Reply 17 of 42
    dasanman69dasanman69 Posts: 13,001member
    Apple outsells Samsung at the high end by over 2:1 (Galaxy S and variants hit 200 million recently according to Samsung's own announcement while iPhone sales over the exact same time period as the Galaxy was 430 million).

    Samsung is a distant second place to Apple and 3rd, 4th and 5th are so far behind they're hardly even relevant.

    I don't see how anyone could assume that Apple is "concerned" considering the sales numbers they're consistently putting up.

    There's no such thing as 'too big to fail' nor 'too big a lead'. Dismissing the competition has led to the downfall of men, companies, and countries.
  • Reply 18 of 42
    dasanman69dasanman69 Posts: 13,001member
    pmz wrote: »
    ...I rest my case.

    But how is that different from any iPhone before it? They've all out sold previous models in record numbers.
  • Reply 19 of 42
    snovasnova Posts: 1,281member
    Quote:

    Originally Posted by dasanman69 View Post

     
    Quote:

    Originally Posted by tastowe View Post



    I don't understand dumb customers are buy cheap crappy plastics android phones. I don't to buy any cheap crappy plastic android phones because I want a beautiful sexy iPhone hardware instead plastics phones. The android phones are not beautiful sexy phones




    Who can compete with such highly evolved reasoning?

    you have at least two choices to try to compete. 

    #1 bring up your game in an attempt to satifisty customers like this with higher quality builds like HTC One

    #2. see if you have any affect by trying even harder to appeal to their wallet by making even cheaper junk. 

  • Reply 20 of 42
    dasanman69dasanman69 Posts: 13,001member
    snova wrote: »
    you have at least two choices to try to compete. 
    #1 bring up your game in an attempt to satifisty customers like this with higher quality builds like HTC One
    #2. see if you have any affect by trying even harder to appeal to their wallet by making even cheaper junk. 

    #1 don't you mean 'cheaper junks'?

    #2 I was being facetious.
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