Apple tops worldwide smartphone vendor list in Q4 amid industry contraction, report says

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  • Reply 41 of 73
    avon b7avon b7 Posts: 3,075member
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




  • Reply 42 of 73
    tmaytmay Posts: 3,343member
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next two quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    edited February 2018 Rayz2016
  • Reply 43 of 73
    avon b7avon b7 Posts: 3,075member
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    edited February 2018
  • Reply 44 of 73
    nhtnht Posts: 4,334member
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Because if you ignore ASP you can continue with trolling that Apple is failing.

    The answer to your “question” is that you are trolling.
  • Reply 45 of 73
    tmaytmay Posts: 3,343member
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    Pray tell, what the hell is/are your question(s)? Instead of attempting to be clever, how about just providing specific questions? 



    That's a chart of all of the pricing for models over time. The grey line is a graphing of ASP per quarter, up until now, around $600. In a previous post, I stated in error that the ASP was around $700. This actually makes this quarters ASP a much more phenomenal number.

    It's all right there. It's obvious that Apple has been pushing the premium price tier higher for years while attempting to maintain a pricing floor. With the release of the iPhone X at a high pricing tier, Apple simultaneously delivers exactly the lover pricing tier that you are asking for.
    edited February 2018
  • Reply 46 of 73
    nhtnht Posts: 4,334member
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    Pray tell, what the hell is/are your question(s)? Instead of attempting to be clever, how about just providing specific questions? 

    He doesn’t have any real questions. He just likes spreading FUD...it has been a constant refrain that the iPhone X must have sold poorly since he hadn’t seen any on the subway.  Therefore it is the cheaper iPhones driving Apple profits which Android and Huawei will soon destroy because of Huawei’s epic technical prowess.  

    Given the higher ASP the product mix shows growth in the higher end for both volume and profit.  But we have to ignore ASPs.  Because.
  • Reply 47 of 73
    tmaytmay Posts: 3,343member
    nht said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    Pray tell, what the hell is/are your question(s)? Instead of attempting to be clever, how about just providing specific questions? 

    He doesn’t have any real questions. He just likes spreading FUD...it has been a constant refrain that the iPhone X must have sold poorly since he hadn’t seen any on the subway.  Therefore it is the cheaper iPhones driving Apple profits which Android and Huawei will soon destroy because of Huawei’s epic technical prowess.  

    Given the higher ASP the product mix shows growth in the higher end for both volume and profit.  But we have to ignore ASPs.  Because.
    I tracked down the graph that I remember seeing on asymco.com and posted it above. 

    Literally, every, single, piece of information needed to understand Apple's pricing tier in one, single, graph!

    He's seriously shooting blanks with his positions.
  • Reply 48 of 73
    avon b7avon b7 Posts: 3,075member
    nht said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Because if you ignore ASP you can continue with trolling that Apple is failing.

    The answer to your “question” is that you are trolling.
    Where have you seen me say that anyone should ignore ASP? However, it is far from the be all and end all (the Holy Grail, if you wish) of a business model.

    Sales are still flat, whichever way you look at things and Apple is trying to change that. Or would you dispute that, given the new model spread?

  • Reply 49 of 73
    avon b7avon b7 Posts: 3,075member
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    Pray tell, what the hell is/are your question(s)? Instead of attempting to be clever, how about just providing specific questions? 



    That's a chart of all of the pricing for models over time. The grey line is a graphing of ASP per quarter, up until now, around $600. In a previous post, I stated in error that the ASP was around $700. This actually makes this quarters ASP a much more phenomenal number.

    It's all right there. It's obvious that Apple has been pushing the premium price tier higher for years while attempting to maintain a pricing floor. With the release of the iPhone X at a high pricing tier, Apple simultaneously delivers exactly the lover pricing tier that you are asking for.
    Nice graph. Showing exactly what we have all lived through first hand, quarter after quarter. There is much more to things than ASP, though. Do I have to repeat that? You need to take those other things into account (things that aren't on that graph) and I've questioned you directly in this very thread but you haven't answered beyond your obsession with ASP.




  • Reply 50 of 73
    avon b7avon b7 Posts: 3,075member
    nht said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    Pray tell, what the hell is/are your question(s)? Instead of attempting to be clever, how about just providing specific questions? 

    He doesn’t have any real questions. He just likes spreading FUD...it has been a constant refrain that the iPhone X must have sold poorly since he hadn’t seen any on the subway.  Therefore it is the cheaper iPhones driving Apple profits which Android and Huawei will soon destroy because of Huawei’s epic technical prowess.  

    Given the higher ASP the product mix shows growth in the higher end for both volume and profit.  But we have to ignore ASPs.  Because.
    Not seen one single iPhone X in the wild but it's early days. However, Apple got hit hard in my part of the world. Seeing as Tmay hasn't answered my question I will put it to you.

    How many of those iPhones at the bottom end of Apple's price spread do you think were shipped in this last quarter?

    If we take them out of the balance, how would it have affected the results or do you think that buyers of those phones would have just upped to the next available tier anyway?

    And why do we now have the biggest spread of models available in iPhone history and, a major difference to iPhones past, all of them have enough memory to actually do things with?

    What changed at Apple to justify such an unprecedented change?




  • Reply 51 of 73
    tmaytmay Posts: 3,343member
    avon b7 said:
    nht said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    Pray tell, what the hell is/are your question(s)? Instead of attempting to be clever, how about just providing specific questions? 

    He doesn’t have any real questions. He just likes spreading FUD...it has been a constant refrain that the iPhone X must have sold poorly since he hadn’t seen any on the subway.  Therefore it is the cheaper iPhones driving Apple profits which Android and Huawei will soon destroy because of Huawei’s epic technical prowess.  

    Given the higher ASP the product mix shows growth in the higher end for both volume and profit.  But we have to ignore ASPs.  Because.
    Not seen one single iPhone X in the wild but it's early days. However, Apple got hit hard in my part of the world. Seeing as Tmay hasn't answered my question I will put it to you.

    How many of those iPhones at the bottom end of Apple's price spread do you think were shipped in this last quarter?

    If we take them out of the balance, how would it have affected the results or do you think that buyers of those phones would have just upped to the next available tier anyway?

    And why do we now have the biggest spread of models available in iPhone history and, a major difference to iPhones past, all of them have enough memory to actually do things with?

    What changed at Apple to justify such an unprecedented change?




    No one could have possibly imagined that was the burning question of your day...

    AFAIK, no one has an interest, yet, in attempting to figure out the full mix of iPhones for the Quarter, but, there are estimates that 29 m were iPhone X, followed by the iPhones 8 and 7. That doesn't leave much room for sales of the SE or the 6, but it wouldn't change my premise anyway and your scenario of pulling out the low end didn't happen in the real world, so we'll never know. But that ASP surely favors my pov.

    Spain, btw, saw a half percent increase in Apple sales, so "hit hard in my part of the world" looks to be a bit of a reversal, and quite a bit of an exaggeration on your part. 

    The smartphone market, worldwide, was down from 437m to 400m YOY for the quarter, yet Apple increased its ASP and had, at the worst, flat sales, depending on counting days in the quarter. Looks like Android OS saw a drop of 37m in unit sales.

    That's an example of "hit hard". 

    As for your "unprecedented change", I would advise that the process of increasing sales tiers has been ongoing since at least 2010. You just need to look closer at the sales history, which i happily provided in the chart.

    Keep doing what your doing if it makes you happy. 

    I'm finished here.
    edited February 2018
  • Reply 52 of 73
    avon b7avon b7 Posts: 3,075member
    tmay said:
    avon b7 said:
    nht said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    tmay said:
    avon b7 said:
    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    Pray tell, what the hell is/are your question(s)? Instead of attempting to be clever, how about just providing specific questions? 

    He doesn’t have any real questions. He just likes spreading FUD...it has been a constant refrain that the iPhone X must have sold poorly since he hadn’t seen any on the subway.  Therefore it is the cheaper iPhones driving Apple profits which Android and Huawei will soon destroy because of Huawei’s epic technical prowess.  

    Given the higher ASP the product mix shows growth in the higher end for both volume and profit.  But we have to ignore ASPs.  Because.
    Not seen one single iPhone X in the wild but it's early days. However, Apple got hit hard in my part of the world. Seeing as Tmay hasn't answered my question I will put it to you.

    How many of those iPhones at the bottom end of Apple's price spread do you think were shipped in this last quarter?

    If we take them out of the balance, how would it have affected the results or do you think that buyers of those phones would have just upped to the next available tier anyway?

    And why do we now have the biggest spread of models available in iPhone history and, a major difference to iPhones past, all of them have enough memory to actually do things with?

    What changed at Apple to justify such an unprecedented change?




    No one could have possibly imagined that was the burning question of your day...

    AFAIK, no one has an interest, yet, in attempting to figure out the full mix of iPhones for the Quarter, but, there are estimates that 29 m were iPhone X, followed by the iPhones 8 and 7. That doesn't leave much room for sales of the SE or the 6, but it wouldn't change my premise anyway and your scenario of pulling out the low end didn't happen in the real world, so we'll never know. But that ASP surely favors my pov.

    Spain, btw, saw a half percent increase in Apple sales, so "hit hard in my part of the world" looks to be a bit of a reversal, and quite a bit of an exaggeration on your part. 

    The smartphone market, worldwide, was down from 437m to 400m YOY for the quarter, yet Apple increased its ASP and had, at the worst, flat sales, depending on counting days in the quarter. Looks like Android OS saw a drop of 37m in unit sales.

    That's an example of "hit hard". 

    As for your "unprecedented change", I would advise that the process of increasing sales tiers has been ongoing since at least 2010. You just need to look closer at the sales history, which i happily provided in the chart.

    Keep doing what your doing if it makes you happy. 

    I'm finished here.
    Apple was hit hard in Spain. That in a historical context. It is no exaggeration. Android remains at over 87% even today. Your 0,5% 'up' is hardly earth shattering and I've seen reports that it was actually 'down'.

    http://www.businessinsider.com/apples-iphone-market-share-in-spain-has-been-all-but-wiped-out-2013-12

    https://www.kantarworldpanel.com/global/smartphone-os-market-share/

    http://www.businessinsider.com/apple-ios-market-share-us-europe-japan-2018-1

    You will see many carrier stores all over the place in Spanish cities. You will be very hard pressed to see an iPhone in any store front window. You will see Huawei and Samsung literally everywhere, though. That is the competition you think isn't relevant against Apple. It is, as you can enter any of those stores and ask for an iPhone and still be swayed away by the seller. Remember that there are hundreds of such stores throughout Spain and relatively few Apple Retail Stores. Apple also has stores within stores but, once again, it has to compete with dozens of Huawei and Samsung models in them. This wasn't always the case. There was a time when it was iPhones on the store fronts and everybody wanted one. Times change.

    ASP in not irrelevant but Apple is looking to shift units. It wants (dare I say, 'needs') to expand into developing markets and retain or improve performance elsewhere. 

    It is the only reason they left so many models in the last revision and I'm sure that you accept that.

    You still haven't answered the questions I put forward. That's fine.

    I did not ask you any 'burning' questions. That is an exaggeration on your part, as was your throwaway 'profitless business models' jab. Unnecessary and deliberate seeing as Muthuk_vanalingam had explicitly stated that he was talking about the middle ground and NOT the low end and had directly said their were profits to be had there. An opinion I share with him 100%. Your barb was unwarranted. Then the 'race to the bottom' line cropped up (yet again!). So, you are going out of your way to make it clear that it isn't about the bottom end, and that profits ARE being had in the middle tiers, that that is where most of the growth is, and people still throw in the race to the bottom! I suspect more high end Android phones shipped last year than ever before. I wonder if I'm right with that suspicion.

    But I will answer the first question I posed even if it isn't 'burning'.

    I took this snippet from the article:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    It was just a snippet and just for the heck of it because when you read these things you know what to expect.

    I asked what wasn't being told in that snippet.

    First. As Apple's sales have largely been flat for a few years, some people simply state that growth in unit sales isn't important. Some point to ASP etc. Anything to take the focus away from the fact - even if the fact itself is brought up. In spite of this, in this snippet 'unit sales' are now valid. The reality is that it's important in the context of the article simply because the numbers are better than Samsung's. If it were the other way around it wouldn't have been mentioned.

    But wait, 4%? For a quarter. That's hardly a significant number. That's not the aim though. The aim is to show it beat Samsung.

    But wait. Are these numbers real? Yes, but they are not Samsung's. They are from an estimate, but not from Samsung. We have someone putting Apple's declared numbers against an estimate from someone completely unrelated to Samsung. Why not wait for Samsung's official numbers before drawing conclusions? They could be even worse than the estimate! The problem is timing. This piece was to spin Apple's numbers in the best possible way and had to appear now for the desired effect. Give the facts as they stand, but focus on what you want to highlight and if it lets you diss Samsung or Google into the bargain, then it's Thunderbirds are go!

    The 4% was good enough to run with. If  Samsung's numbers turn out to be much worse, you can bet there will be a comment on them. If they are better than forecast, well nobody cares about that, right?

    Then, there is perspective. This is just one quarter in the year. It is also Apple's biggest. It always is. With annual sales flat for the last few years and the success story of these results resting largely on initial sales of iPhone X, what are we to expect during this year? There is a possibility that there won't be so much to cheer about over the coming quarters. iPhone X will NOT reach the same levels of performance. Or do you think it could improve its performance? iPhone 8 series is there to tug things along and there is a nice spread of lower end options but both Samsung and Huawei will be releasing new flagships during this period. There is more direct competition between them but Apple is not immune, above all when it comes to increasing unit shipments and would prefer to see Android users switch.

    IMO, Apple is doing what it needs to do.

    Opening up the model spread was key. There was no way they could forge an opening in developing markets without it. You believe that the low end phones did little to impact unit shipments. I believe you are underestimating their relevance and that a few million less units sold would have had a very negative impact on the interpretation of these results but it's impossible to know. The only qualm I have is that they have just one bezeless phone available and hugely expensive. The rest of the line will look decidedly 'old' this year. Personally, that isn't an issue for me but the market is the market. And if Huawei brings its new battery tech to market without licencing it to competitors, we will see if a longer battery lifespan and 50% charge in five minutes proves to be a draw.

    Otherwise, I agree with what they are doing with handsets.

    In other areas there are highs and lows. Services are necessary and doing well but ultimately depend on unit shipments. The Mac is underperforming IMO. The move into content creation could pay off. HomePods and the like will probably add to the bottom line and there will be other products to come.

    We will see how things play out. I don't profess to know.







    edited February 2018
  • Reply 53 of 73
    tmaytmay Posts: 3,343member
    avon b7 said:
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    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    Pray tell, what the hell is/are your question(s)? Instead of attempting to be clever, how about just providing specific questions? 

    He doesn’t have any real questions. He just likes spreading FUD...it has been a constant refrain that the iPhone X must have sold poorly since he hadn’t seen any on the subway.  Therefore it is the cheaper iPhones driving Apple profits which Android and Huawei will soon destroy because of Huawei’s epic technical prowess.  

    Given the higher ASP the product mix shows growth in the higher end for both volume and profit.  But we have to ignore ASPs.  Because.
    Not seen one single iPhone X in the wild but it's early days. However, Apple got hit hard in my part of the world. Seeing as Tmay hasn't answered my question I will put it to you.

    How many of those iPhones at the bottom end of Apple's price spread do you think were shipped in this last quarter?

    If we take them out of the balance, how would it have affected the results or do you think that buyers of those phones would have just upped to the next available tier anyway?

    And why do we now have the biggest spread of models available in iPhone history and, a major difference to iPhones past, all of them have enough memory to actually do things with?

    What changed at Apple to justify such an unprecedented change?




    No one could have possibly imagined that was the burning question of your day...

    AFAIK, no one has an interest, yet, in attempting to figure out the full mix of iPhones for the Quarter, but, there are estimates that 29 m were iPhone X, followed by the iPhones 8 and 7. That doesn't leave much room for sales of the SE or the 6, but it wouldn't change my premise anyway and your scenario of pulling out the low end didn't happen in the real world, so we'll never know. But that ASP surely favors my pov.

    Spain, btw, saw a half percent increase in Apple sales, so "hit hard in my part of the world" looks to be a bit of a reversal, and quite a bit of an exaggeration on your part. 

    The smartphone market, worldwide, was down from 437m to 400m YOY for the quarter, yet Apple increased its ASP and had, at the worst, flat sales, depending on counting days in the quarter. Looks like Android OS saw a drop of 37m in unit sales.

    That's an example of "hit hard". 

    As for your "unprecedented change", I would advise that the process of increasing sales tiers has been ongoing since at least 2010. You just need to look closer at the sales history, which i happily provided in the chart.

    Keep doing what your doing if it makes you happy. 

    I'm finished here.
    Apple was hit hard in Spain. That in a historical context. It is no exaggeration. Android remains at over 87% even today. Your 0,5% 'up' is hardly earth shattering and I've seen reports that it was actually 'down'.

    http://www.businessinsider.com/apples-iphone-market-share-in-spain-has-been-all-but-wiped-out-2013-12

    https://www.kantarworldpanel.com/global/smartphone-os-market-share/

    http://www.businessinsider.com/apple-ios-market-share-us-europe-japan-2018-1

    You will see many carrier stores all over the place in Spanish cities. You will be very hard pressed to see an iPhone in any store front window. You will see Huawei and Samsung literally everywhere, though. That is the competition you think isn't relevant against Apple. It is, as you can enter any of those stores and ask for an iPhone and still be swayed away by the seller. Remember that there are hundreds of such stores throughout Spain and relatively few Apple Retail Stores. Apple also has stores within stores but, once again, it has to compete with dozens of Huawei and Samsung models in them. This wasn't always the case. There was a time when it was iPhones on the store fronts and everybody wanted one. Times change.

    ASP in not irrelevant but Apple is looking to shift units. It wants (dare I say, 'needs') to expand into developing markets and retain or improve performance elsewhere. 

    It is the only reason they left so many models in the last revision and I'm sure that you accept that.

    You still haven't answered the questions I put forward. That's fine.

    I did not ask you any 'burning' questions. That is an exaggeration on your part, as was your throwaway 'profitless business models' jab. Unnecessary and deliberate seeing as Muthuk_vanalingam had explicitly stated that he was talking about the middle ground and NOT the low end and had directly said their were profits to be had there. An opinion I share with him 100%. Your barb was unwarranted. Then the 'race to the bottom' line cropped up (yet again!). So, you are going out of your way to make it clear that it isn't about the bottom end, and that profits ARE being had in the middle tiers, that that is where most of the growth is, and people still throw in the race to the bottom! I suspect more high end Android phones shipped last year than ever before. I wonder if I'm right with that suspicion.

    But I will answer the first question I posed even if it isn't 'burning'.

    I took this snippet from the article:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    It was just a snippet and just for the heck of it because when you read these things you know what to expect.

    I asked what wasn't being told in that snippet.

    First. As Apple's sales have largely been flat for a few years, some people simply state that growth in unit sales isn't important. Some point to ASP etc. Anything to take the focus away from the fact - even if the fact itself is brought up. In spite of this, in this snippet 'unit sales' are now valid. The reality is that it's important in the context of the article simply because the numbers are better than Samsung's. If it were the other way around it wouldn't have been mentioned.

    But wait, 4%? For a quarter. That's hardly a significant number. That's not the aim though. The aim is to show it beat Samsung.

    But wait. Are these numbers real? Yes, but they are not Samsung's. They are from an estimate, but not from Samsung. We have someone putting Apple's declared numbers against an estimate from someone completely unrelated to Samsung. Why not wait for Samsung's official numbers before drawing conclusions? They could be even worse than the estimate! The problem is timing. This piece was to spin Apple's numbers in the best possible way and had to appear now for the desired effect. Give the facts as they stand, but focus on what you want to highlight and if it lets you diss Samsung or Google into the bargain, then it's Thunderbirds are go!

    The 4% was good enough to run with. If  Samsung's numbers turn out to be much worse, you can bet there will be a comment on them. If they are better than forecast, well nobody cares about that, right?

    Then, there is perspective. This is just one quarter in the year. It is also Apple's biggest. It always is. With annual sales flat for the last few years and the success story of these results resting largely on initial sales of iPhone X, what are we to expect during this year? There is a possibility that there won't be so much to cheer about over the coming quarters. iPhone X will NOT reach the same levels of performance. Or do you think it could improve its performance? iPhone 8 series is there to tug things along and there is a nice spread of lower end options but both Samsung and Huawei will be releasing new flagships during this period. There is more direct competition between them but Apple is not immune, above all when it comes to increasing unit shipments and would prefer to see Android users switch.

    IMO, Apple is doing what it needs to do.

    Opening up the model spread was key. There was no way they could forge an opening in developing markets without it. You believe that the low end phones did little to impact unit shipments. I believe you are underestimating their relevance and that a few million less units sold would have had a very negative impact on the interpretation of these results but it's impossible to know. The only qualm I have is that they have just one bezeless phone available and hugely expensive. The rest of the line will look decidedly 'old' this year. Personally, that isn't an issue for me but the market is the market. And if Huawei brings its new battery tech to market without licencing it to competitors, we will see if a longer battery lifespan and 50% charge in five minutes proves to be a draw.

    Otherwise, I agree with what they are doing with handsets.

    In other areas there are highs and lows. Services are necessary and doing well but ultimately depend on unit shipments. The Mac is underperforming IMO. The move into content creation could pay off. HomePods and the like will probably add to the bottom line and there will be other products to come.

    We will see how things play out. I don't profess to know.







    It's a bit disingenuous to post a link from 2013 with Apple at 0.5% sales when Spain was considering a bailout from the EU because austerity measures were barely having an effect on turning around Spain's recessionary economy. Let me retort:

    http://money.cnn.com/2012/10/23/news/economy/spain-economy-recession/index.html

    I'm guessing that as Spain regains growth, Apple will continue to see growth in iPhone sales as well, and sure enough, that is the case.

    Subsequently, Apple has increased sales in Spain by 12%. I'm sure that you would state that was due to low end iPhone sales. From my POV, all that is of interest in a declining smartphone market is that Apple is able to maintain ASP. Even with all of sales of Android OS devices, Apple will probably come out with some 80% of the profits in FY2018 for the entire smartphone industry, leaving Samsung and Huawei to fight over the other 20%. 

    Again, if you want me to answer questions wrt this thread, and I would note that I am not a mind reader, you will have to ask these directly. I won't play your little game of "guess what I want you to answer".








    edited February 2018
  • Reply 54 of 73
    avon b7avon b7 Posts: 3,075member
    tmay said:
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    nht said:
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    avon b7 said:
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    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    Pray tell, what the hell is/are your question(s)? Instead of attempting to be clever, how about just providing specific questions? 

    He doesn’t have any real questions. He just likes spreading FUD...it has been a constant refrain that the iPhone X must have sold poorly since he hadn’t seen any on the subway.  Therefore it is the cheaper iPhones driving Apple profits which Android and Huawei will soon destroy because of Huawei’s epic technical prowess.  

    Given the higher ASP the product mix shows growth in the higher end for both volume and profit.  But we have to ignore ASPs.  Because.
    Not seen one single iPhone X in the wild but it's early days. However, Apple got hit hard in my part of the world. Seeing as Tmay hasn't answered my question I will put it to you.

    How many of those iPhones at the bottom end of Apple's price spread do you think were shipped in this last quarter?

    If we take them out of the balance, how would it have affected the results or do you think that buyers of those phones would have just upped to the next available tier anyway?

    And why do we now have the biggest spread of models available in iPhone history and, a major difference to iPhones past, all of them have enough memory to actually do things with?

    What changed at Apple to justify such an unprecedented change?




    No one could have possibly imagined that was the burning question of your day...

    AFAIK, no one has an interest, yet, in attempting to figure out the full mix of iPhones for the Quarter, but, there are estimates that 29 m were iPhone X, followed by the iPhones 8 and 7. That doesn't leave much room for sales of the SE or the 6, but it wouldn't change my premise anyway and your scenario of pulling out the low end didn't happen in the real world, so we'll never know. But that ASP surely favors my pov.

    Spain, btw, saw a half percent increase in Apple sales, so "hit hard in my part of the world" looks to be a bit of a reversal, and quite a bit of an exaggeration on your part. 

    The smartphone market, worldwide, was down from 437m to 400m YOY for the quarter, yet Apple increased its ASP and had, at the worst, flat sales, depending on counting days in the quarter. Looks like Android OS saw a drop of 37m in unit sales.

    That's an example of "hit hard". 

    As for your "unprecedented change", I would advise that the process of increasing sales tiers has been ongoing since at least 2010. You just need to look closer at the sales history, which i happily provided in the chart.

    Keep doing what your doing if it makes you happy. 

    I'm finished here.
    Apple was hit hard in Spain. That in a historical context. It is no exaggeration. Android remains at over 87% even today. Your 0,5% 'up' is hardly earth shattering and I've seen reports that it was actually 'down'.

    http://www.businessinsider.com/apples-iphone-market-share-in-spain-has-been-all-but-wiped-out-2013-12

    https://www.kantarworldpanel.com/global/smartphone-os-market-share/

    http://www.businessinsider.com/apple-ios-market-share-us-europe-japan-2018-1

    You will see many carrier stores all over the place in Spanish cities. You will be very hard pressed to see an iPhone in any store front window. You will see Huawei and Samsung literally everywhere, though. That is the competition you think isn't relevant against Apple. It is, as you can enter any of those stores and ask for an iPhone and still be swayed away by the seller. Remember that there are hundreds of such stores throughout Spain and relatively few Apple Retail Stores. Apple also has stores within stores but, once again, it has to compete with dozens of Huawei and Samsung models in them. This wasn't always the case. There was a time when it was iPhones on the store fronts and everybody wanted one. Times change.

    ASP in not irrelevant but Apple is looking to shift units. It wants (dare I say, 'needs') to expand into developing markets and retain or improve performance elsewhere. 

    It is the only reason they left so many models in the last revision and I'm sure that you accept that.

    You still haven't answered the questions I put forward. That's fine.

    I did not ask you any 'burning' questions. That is an exaggeration on your part, as was your throwaway 'profitless business models' jab. Unnecessary and deliberate seeing as Muthuk_vanalingam had explicitly stated that he was talking about the middle ground and NOT the low end and had directly said their were profits to be had there. An opinion I share with him 100%. Your barb was unwarranted. Then the 'race to the bottom' line cropped up (yet again!). So, you are going out of your way to make it clear that it isn't about the bottom end, and that profits ARE being had in the middle tiers, that that is where most of the growth is, and people still throw in the race to the bottom! I suspect more high end Android phones shipped last year than ever before. I wonder if I'm right with that suspicion.

    But I will answer the first question I posed even if it isn't 'burning'.

    I took this snippet from the article:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    It was just a snippet and just for the heck of it because when you read these things you know what to expect.

    I asked what wasn't being told in that snippet.

    First. As Apple's sales have largely been flat for a few years, some people simply state that growth in unit sales isn't important. Some point to ASP etc. Anything to take the focus away from the fact - even if the fact itself is brought up. In spite of this, in this snippet 'unit sales' are now valid. The reality is that it's important in the context of the article simply because the numbers are better than Samsung's. If it were the other way around it wouldn't have been mentioned.

    But wait, 4%? For a quarter. That's hardly a significant number. That's not the aim though. The aim is to show it beat Samsung.

    But wait. Are these numbers real? Yes, but they are not Samsung's. They are from an estimate, but not from Samsung. We have someone putting Apple's declared numbers against an estimate from someone completely unrelated to Samsung. Why not wait for Samsung's official numbers before drawing conclusions? They could be even worse than the estimate! The problem is timing. This piece was to spin Apple's numbers in the best possible way and had to appear now for the desired effect. Give the facts as they stand, but focus on what you want to highlight and if it lets you diss Samsung or Google into the bargain, then it's Thunderbirds are go!

    The 4% was good enough to run with. If  Samsung's numbers turn out to be much worse, you can bet there will be a comment on them. If they are better than forecast, well nobody cares about that, right?

    Then, there is perspective. This is just one quarter in the year. It is also Apple's biggest. It always is. With annual sales flat for the last few years and the success story of these results resting largely on initial sales of iPhone X, what are we to expect during this year? There is a possibility that there won't be so much to cheer about over the coming quarters. iPhone X will NOT reach the same levels of performance. Or do you think it could improve its performance? iPhone 8 series is there to tug things along and there is a nice spread of lower end options but both Samsung and Huawei will be releasing new flagships during this period. There is more direct competition between them but Apple is not immune, above all when it comes to increasing unit shipments and would prefer to see Android users switch.

    IMO, Apple is doing what it needs to do.

    Opening up the model spread was key. There was no way they could forge an opening in developing markets without it. You believe that the low end phones did little to impact unit shipments. I believe you are underestimating their relevance and that a few million less units sold would have had a very negative impact on the interpretation of these results but it's impossible to know. The only qualm I have is that they have just one bezeless phone available and hugely expensive. The rest of the line will look decidedly 'old' this year. Personally, that isn't an issue for me but the market is the market. And if Huawei brings its new battery tech to market without licencing it to competitors, we will see if a longer battery lifespan and 50% charge in five minutes proves to be a draw.

    Otherwise, I agree with what they are doing with handsets.

    In other areas there are highs and lows. Services are necessary and doing well but ultimately depend on unit shipments. The Mac is underperforming IMO. The move into content creation could pay off. HomePods and the like will probably add to the bottom line and there will be other products to come.

    We will see how things play out. I don't profess to know.







    It's a bit disingenuous to post a link from 2013 with Apple at 0.5% sales when Spain was considering a bailout from the EU because austerity measures were barely having an effect on turning around Spain's recessionary economy. Let me retort:

    http://money.cnn.com/2012/10/23/news/economy/spain-economy-recession/index.html

    I'm guessing that as Spain regains growth, Apple will continue to see growth in iPhone sales as well, and sure enough, that is the case.

    Subsequently, Apple has increased sales in Spain by 12%. I'm sure that you would state that was due to low end iPhone sales. From my POV, all that is of interest in a declining smartphone market is that Apple is able to maintain ASP. Even with all of sales of Android OS devices, Apple will probably come out with some 80% of the profits in FY2018 for the entire smartphone industry, leaving Samsung and Huawei to fight over the other 20%. 

    Again, if you want me to answer questions wrt this thread, and I would note that I am not a mind reader, you will have to ask these directly. I won't play your little game of "guess what I want you to answer".








    Apple got hit hard here and never recovered. I don't see why you would dispute that. I put things into historical context with the first link but the other two were bang up to date. Android still has more than 87% of the market - today.

    Apple has gained a little, especially with the demise of Windows on mobile with companies renewing fleet phones, but hasn't recovered.

    We went through one of the toughest recessions in recent history but the people affected most by that were people far below Apple's pricing bands. Things are actually more complicated but Apple's demise here has more to do with Samsung and Huawei than anything else.

    Far from exagerrating, I was very reserved when touching this subject. I could have mentioned other EU countries but just limited the comment to my part of the world. in the run up to the end of the year, Apple lost share in many areas of Europe.
  • Reply 55 of 73
    tmaytmay Posts: 3,343member
    avon b7 said:
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    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    Pray tell, what the hell is/are your question(s)? Instead of attempting to be clever, how about just providing specific questions? 

    He doesn’t have any real questions. He just likes spreading FUD...it has been a constant refrain that the iPhone X must have sold poorly since he hadn’t seen any on the subway.  Therefore it is the cheaper iPhones driving Apple profits which Android and Huawei will soon destroy because of Huawei’s epic technical prowess.  

    Given the higher ASP the product mix shows growth in the higher end for both volume and profit.  But we have to ignore ASPs.  Because.
    Not seen one single iPhone X in the wild but it's early days. However, Apple got hit hard in my part of the world. Seeing as Tmay hasn't answered my question I will put it to you.

    How many of those iPhones at the bottom end of Apple's price spread do you think were shipped in this last quarter?

    If we take them out of the balance, how would it have affected the results or do you think that buyers of those phones would have just upped to the next available tier anyway?

    And why do we now have the biggest spread of models available in iPhone history and, a major difference to iPhones past, all of them have enough memory to actually do things with?

    What changed at Apple to justify such an unprecedented change?




    No one could have possibly imagined that was the burning question of your day...

    AFAIK, no one has an interest, yet, in attempting to figure out the full mix of iPhones for the Quarter, but, there are estimates that 29 m were iPhone X, followed by the iPhones 8 and 7. That doesn't leave much room for sales of the SE or the 6, but it wouldn't change my premise anyway and your scenario of pulling out the low end didn't happen in the real world, so we'll never know. But that ASP surely favors my pov.

    Spain, btw, saw a half percent increase in Apple sales, so "hit hard in my part of the world" looks to be a bit of a reversal, and quite a bit of an exaggeration on your part. 

    The smartphone market, worldwide, was down from 437m to 400m YOY for the quarter, yet Apple increased its ASP and had, at the worst, flat sales, depending on counting days in the quarter. Looks like Android OS saw a drop of 37m in unit sales.

    That's an example of "hit hard". 

    As for your "unprecedented change", I would advise that the process of increasing sales tiers has been ongoing since at least 2010. You just need to look closer at the sales history, which i happily provided in the chart.

    Keep doing what your doing if it makes you happy. 

    I'm finished here.
    Apple was hit hard in Spain. That in a historical context. It is no exaggeration. Android remains at over 87% even today. Your 0,5% 'up' is hardly earth shattering and I've seen reports that it was actually 'down'.

    http://www.businessinsider.com/apples-iphone-market-share-in-spain-has-been-all-but-wiped-out-2013-12

    https://www.kantarworldpanel.com/global/smartphone-os-market-share/

    http://www.businessinsider.com/apple-ios-market-share-us-europe-japan-2018-1

    You will see many carrier stores all over the place in Spanish cities. You will be very hard pressed to see an iPhone in any store front window. You will see Huawei and Samsung literally everywhere, though. That is the competition you think isn't relevant against Apple. It is, as you can enter any of those stores and ask for an iPhone and still be swayed away by the seller. Remember that there are hundreds of such stores throughout Spain and relatively few Apple Retail Stores. Apple also has stores within stores but, once again, it has to compete with dozens of Huawei and Samsung models in them. This wasn't always the case. There was a time when it was iPhones on the store fronts and everybody wanted one. Times change.

    ASP in not irrelevant but Apple is looking to shift units. It wants (dare I say, 'needs') to expand into developing markets and retain or improve performance elsewhere. 

    It is the only reason they left so many models in the last revision and I'm sure that you accept that.

    You still haven't answered the questions I put forward. That's fine.

    I did not ask you any 'burning' questions. That is an exaggeration on your part, as was your throwaway 'profitless business models' jab. Unnecessary and deliberate seeing as Muthuk_vanalingam had explicitly stated that he was talking about the middle ground and NOT the low end and had directly said their were profits to be had there. An opinion I share with him 100%. Your barb was unwarranted. Then the 'race to the bottom' line cropped up (yet again!). So, you are going out of your way to make it clear that it isn't about the bottom end, and that profits ARE being had in the middle tiers, that that is where most of the growth is, and people still throw in the race to the bottom! I suspect more high end Android phones shipped last year than ever before. I wonder if I'm right with that suspicion.

    But I will answer the first question I posed even if it isn't 'burning'.

    I took this snippet from the article:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    It was just a snippet and just for the heck of it because when you read these things you know what to expect.

    I asked what wasn't being told in that snippet.

    First. As Apple's sales have largely been flat for a few years, some people simply state that growth in unit sales isn't important. Some point to ASP etc. Anything to take the focus away from the fact - even if the fact itself is brought up. In spite of this, in this snippet 'unit sales' are now valid. The reality is that it's important in the context of the article simply because the numbers are better than Samsung's. If it were the other way around it wouldn't have been mentioned.

    But wait, 4%? For a quarter. That's hardly a significant number. That's not the aim though. The aim is to show it beat Samsung.

    But wait. Are these numbers real? Yes, but they are not Samsung's. They are from an estimate, but not from Samsung. We have someone putting Apple's declared numbers against an estimate from someone completely unrelated to Samsung. Why not wait for Samsung's official numbers before drawing conclusions? They could be even worse than the estimate! The problem is timing. This piece was to spin Apple's numbers in the best possible way and had to appear now for the desired effect. Give the facts as they stand, but focus on what you want to highlight and if it lets you diss Samsung or Google into the bargain, then it's Thunderbirds are go!

    The 4% was good enough to run with. If  Samsung's numbers turn out to be much worse, you can bet there will be a comment on them. If they are better than forecast, well nobody cares about that, right?

    Then, there is perspective. This is just one quarter in the year. It is also Apple's biggest. It always is. With annual sales flat for the last few years and the success story of these results resting largely on initial sales of iPhone X, what are we to expect during this year? There is a possibility that there won't be so much to cheer about over the coming quarters. iPhone X will NOT reach the same levels of performance. Or do you think it could improve its performance? iPhone 8 series is there to tug things along and there is a nice spread of lower end options but both Samsung and Huawei will be releasing new flagships during this period. There is more direct competition between them but Apple is not immune, above all when it comes to increasing unit shipments and would prefer to see Android users switch.

    IMO, Apple is doing what it needs to do.

    Opening up the model spread was key. There was no way they could forge an opening in developing markets without it. You believe that the low end phones did little to impact unit shipments. I believe you are underestimating their relevance and that a few million less units sold would have had a very negative impact on the interpretation of these results but it's impossible to know. The only qualm I have is that they have just one bezeless phone available and hugely expensive. The rest of the line will look decidedly 'old' this year. Personally, that isn't an issue for me but the market is the market. And if Huawei brings its new battery tech to market without licencing it to competitors, we will see if a longer battery lifespan and 50% charge in five minutes proves to be a draw.

    Otherwise, I agree with what they are doing with handsets.

    In other areas there are highs and lows. Services are necessary and doing well but ultimately depend on unit shipments. The Mac is underperforming IMO. The move into content creation could pay off. HomePods and the like will probably add to the bottom line and there will be other products to come.

    We will see how things play out. I don't profess to know.







    It's a bit disingenuous to post a link from 2013 with Apple at 0.5% sales when Spain was considering a bailout from the EU because austerity measures were barely having an effect on turning around Spain's recessionary economy. Let me retort:

    http://money.cnn.com/2012/10/23/news/economy/spain-economy-recession/index.html

    I'm guessing that as Spain regains growth, Apple will continue to see growth in iPhone sales as well, and sure enough, that is the case.

    Subsequently, Apple has increased sales in Spain by 12%. I'm sure that you would state that was due to low end iPhone sales. From my POV, all that is of interest in a declining smartphone market is that Apple is able to maintain ASP. Even with all of sales of Android OS devices, Apple will probably come out with some 80% of the profits in FY2018 for the entire smartphone industry, leaving Samsung and Huawei to fight over the other 20%. 

    Again, if you want me to answer questions wrt this thread, and I would note that I am not a mind reader, you will have to ask these directly. I won't play your little game of "guess what I want you to answer".








    Apple got hit hard here and never recovered. I don't see why you would dispute that. I put things into historical context with the first link but the other two were bang up to date. Android still has more than 87% of the market - today.

    Apple has gained a little, especially with the demise of Windows on mobile with companies renewing fleet phones, but hasn't recovered.

    We went through one of the toughest recessions in recent history but the people affected most by that were people far below Apple's pricing bands. Things are actually more complicated but Apple's demise here has more to do with Samsung and Huawei than anything else.

    Far from exagerrating, I was very reserved when touching this subject. I could have mentioned other EU countries but just limited the comment to my part of the world. in the run up to the end of the year, Apple lost share in many areas of Europe.
    You have a habit of ignoring data that doesn't suit your meme. Apple recovered from 4.3% sales share in 2013 to 12.7% today in Spain. That's a recovery. You are absolutely lying if you can't acknowledge that fact. I doubt that Apple's share was greater than that prior to the recession.

    I agree that Apple did lose a lot of share in Europe during the recession in the EU. In some of EU states, Apple is recovering in; others not, like Britain, and in that case, likely because of Brexit. You would also have to acknowledge that those recessionary conditions don't exist today, all EU states are in growth, and that with the reduction in the value of the dollar, Apple will continue picking up overall share in the EU, just as it is regaining share in China.

    I too acknowledge that having an entry level iPhone increases unit sales and marketshare, but this has been true for seven years. Over those seven years, Apple has been expanding models and both high and low pricing tiers. I think we'll have to agree to disagree, but nowhere have I stated that Apple shouldn't have unit growth, just that Apple's model appears to support the maintenance or extension of ASP over marketshare, and that graph that I linked absolutely demonstrated that.

    That Samsung and Huawei find much lower ASP's acceptable in either their maintenance or growth of units and marketshare, is of little interest to me, other than acknowledgement that it is an important factor in the overall equation.
    edited February 2018
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    avon b7avon b7 Posts: 3,075member
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    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.
    This argument is so easily debunked I feel like I’m explaining how ice is a thing. A. In what way is this challenge “unique?” It is no such thing. B. The middle class can grow. You may be thinking only of America, where the middle class is being systematically killed off, but the middle class is growing by leaps and bounds in some other countries. You must have missed the part where Cook noted China had double-digit growth, Japan had double-digit growth, indeed the company said all their market segments were up. Apple is now the number one seller of smartphones worldwide by revenue. So your claim that “only so many people can afford an iPhone” is unvarnished malarkey. C. You have a fair point that if the world economy goes badly south, Apple may hurt more than others, but a recent story elsewhere that rated the refurb iPhone 7 line as “clearly the best phone you can buy for $380” makes me think maybe — just maybe — Apple has already given that scenario some thought. It seems to me to be well-proven that people want as close to the iPhone experience as they can afford to get, and Apple has responded to that by ... offering an array or mid-range models , most of which are older designs, but not old iPhones — from the SE to the 6S to the 7 Plus, they are all brand new (and if you’re willing to go refurb or used, they’re even cheaper). D. Yes, iPhone sales were essentially flat this year, but you seem to be ignoring the fact that for *every other maker not named Samsung,* sales were way down. IOW, the global smartphone industry just had exactly the sort of major market downturn you’re predicting will hurt Apple the most — and yet the companies who were actually hurt the most by it were — the cheapie/knockoff makers, because they weren’t making any money to start with.

    chasm said:
    Here is the new unique challenge that Apple will have to deal with. "Premium" segment in terms of volume (phones with >$600) is NOT going to increase in the coming years. This segment is stagnant with no more room for growth, because there are only so many people on this planet who can "afford" premium devices.


    muthuk_vanalingam posted based on facts.

    The premium segment has stagnated in unit sales. You can't counter that as needing to be debunked by saying revenues are up. They are completely different beasts.

    We need to pull back from the Christmas quarter and see the bigger picture. How many phones did Apple sell in 2017, 2016, 2015?

    We know these numbers. They are facts and the facts tell us that growth for Apple in unit sales has been largely flat for the last few years. It's not a new situation but one that Apple clearly wants to change.

    Your affirmation that the middle classes are growing by leaps and bounds doesn't debunk anything either. There is no guarantee that some, many or all of them will spend on premium iPhones. That is to be seen. Those people probably have more non iPhone options open to them as ever before. We also can't claim that iPhone X sales this quarter actually mean anything. Not yet anyway one thing is almost certain. iPhone X shipments will drop off as the year progresses.

    You need to answer this question. Why did Apple leave older phones in the product mix when they announced the 8 and X series? What made them take that huge strategic decision? One that left its older - cheaper - phones in the mix to potentially canibalise the more expensive options?

    If they were seeing the same middle classes as you growing in leaps and bounds, why take risks?

    Now, let's reflect on these latest results and try to imagine them sans the older phones in the mix? How do you think things would have looked?

    Revenues would still have been high, I'm sure, but how would unit sales look? And what would the reaction have been? 

    Your point B is centred on the Christmas quarter. The peak in Apple's year. Things always get worse after that. We might see a new SE but Apple has set out its stall for the long months ahead. You mention growth in China but Apple still has a long way to go there and these latest flat numbers included that double digit growth you referred to anyway.

    So, what can be done to increase unit sales? Or is Apple happy to remain flat?

    The best option is to try and pick up sales in the shark infested mid tiers and that isn't what many here claim it to be 'a race to the bottom'. More like a race to the middle and Apple is late to that party. Even so, it's worth the effort and they arrived in earnest in the Christmas quarter. That move may have saved the day yesterday.

    Your affirmation that any other maker not named Samsung is showing sales well down, isn't correct. Huawei has topped its previous year's sales.

    muthuk_vanalingam made a very good point IMO.






    http://appleinsider.com/articles/18/02/02/apple-beat-samsung-in-unit-sales-with-iphone-x-during-q4-during-the-biggest-annual-fall-in-smartphone-history

    I can see that Samsung has followed your advice to the letter.
    LOL. You cannot be serious!  

    Just for the heck of it:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    I hope you were paying attention as you know anything he writes is deliberately skewed to show Apple in the best possible light while dissing competitors.

    So, take a look at that snippet and tell me what's not being said.




    Did you forget to mention that Samsung had 1/3 of Apple's ASP; it's hard to miss that in the story.


    I have never ever made a big deal out of ASP. 

    My post was on unit performance, marketshare and everything that comes from that.

    I will conclude that you don't know how to answer my question.
    Of course you don't make a big deal out of ASP, you're fine with profitless business models when it suits your marketshare nonsense.
    Not at all. I have a more balanced opinion.

    You still haven't answered my question.

    While I await your answer, I  will add another. Why did Apple leave its older models in the product mix and not follow its historical behaviour?

    I have never ever mentioned a profitless business model. Ever.
    I have consistently stated that Apple required a more expensive premium iPhone, in this case, the iPhone X, in order to allow lower cost entry iPhones and still keep the ASP at around $700, or where is has consistently been when corrected for inflation. That Apple exceeded that by near $100 ASP indicated that it was in fact the iPhone X that drove the higher ASP. The fact that Samsung has such low ASP's even with it's similarly priced premium phones indicates that Samsung has not achieved the same balance of model price tiers. 

    To reiterate;

    It is not difficult to understand, but having a high price for a premium phone allows lower entry price tiers, and at the same time, proper balance of models retains ASP. This is why Apple, over the years, has added even more higher, and lower, price tiers, Merely creating lower price tiers may drive unit sales and marketshare, but ultimately leads to lower ASP and, in the long run, less revenue and profit. I believe that Apple's financials indicate that it has mastered this, and given the future roadmap of iPhones, I would expect yet another super premium iPhone in the horizon, likely with a large OLED screen and supporting the pencil, and similarly, a lower priced SE to follow, maintaining unit sales increases, and increases in the user base, while maintaining revenue and profit expansion. 

    I would add to that. Customer loyalty to iPhones indicates that 96% will buy another iPhone, even if users will keep their iPhones longer. This is ultimately bad news for Android OS device makers, as they will not be able to penetrate the iPhone ecosystem sufficiently to draw new into the Android OS platform.

    This leaves Android OS device manufacturers competing to maintain marketshare, and unit sales, at whatever the cost, driving down ASP, revenue and profits for all. This is a fact as noted by Apple portion of the overall profits in the smartphone market. It is not a death spiral for Android OS device makers, but technology diffusion leaves very little room for any single device manufacturer to exceed Samsung's revenue and share; Samsung will fight tooth and nail to prevent that.
    You confirm what was evident. Your essay has nothing to do with anything I have mentioned on ASP, which is largely nothing.

    It's your opinion though, which is fine and I can see why you think that way.

    I disagree with your line that Apple's ASP somehow facilitated the entry into the lower tiers. It had the financial muscle to do that years ago, and didn't.

    Something happened to make them change tack. That 'something' is two or three fold but, in my opinion, centres on at least three areas.

    1. Consistently flat sales.
    2. Handset saturation 
    3. Increased competition

    There is no denying the fact that putting out lower priced options increases the risk of those options eating into the higher priced models. It's a risk I'm sure Apple weighed up very carefully but decided to take with the sole purpose of increasing unit sales.

    I could go on but would be rehashing what I've already explained in the past.

    I will just offer this observation. You support your reasoning by clinging to these latest results and say a new, even more premium device is coming. Anything is possible but two things are evident:

    1. Any new premium Apple offering will not come before September this year (unless Apple breaks that trend too).

    2. iPhone X shipments will fall, possibly dramatically, over the coming months. 

    Where do you situate Apple's ASP come Sept 1st?




    http://www.businessinsider.com/apple-iphone-average-selling-price-2018-2

    This story makes my case. 

    I don't expect ASP to drop below $725 for the next three quarters. iPhone X will be extremely well received and in demand for the next two quarters, will fade for the quarter leading up to the next iteration, and then accelerate up again at the next release.

    Lather, rinse, repeat.

    Increased competition from Android OS devices? I see no evidence of that at all in premium smartphones.
    Lather, rinse, repeat. 

    ASP, ASP, ASP.

    The article doesn't make 'a case' for anything, except: ASP. It's almost a non article.

    You are (wilfully?) Ignoring the questions raised.

    You have not answered one of them.

    The existence of a broader range of models has nothing to do with ASP. Tim Cook has to 'sell' the results he has. Its his job but the presence of cheaper models in the lineup is for a different reason: unit sales. We will see how that plays out, though. One quarter isn't enough to judge but I will repeat what I said before. Try to imagine these results without the millions of lower priced units. Try to imagine the reaction of the markets if unit sales had been well off last year's. The initial success of the X and ASP would have been seen in a completely different light. Ironically, it is now those lower priced units that will be looked on to provide growth in the coming quarters - and in developing markets. It's one of the reasons they exist of course.

    You cannot see competition from premium Android devices? Look at it a different way. If those Android devices didn't exist, would more of their purchasers opt for iPhones or simply choose something less premium?

    That's not hard to answer and means that, in a way, they are taking sales away from Apple.

    My view is that, while premium Android devices compete more with other Android devices, they also compete directly and indirectly with iPhones.

    And you still haven't answered my initial question by the way, ;-)
    Pray tell, what the hell is/are your question(s)? Instead of attempting to be clever, how about just providing specific questions? 

    He doesn’t have any real questions. He just likes spreading FUD...it has been a constant refrain that the iPhone X must have sold poorly since he hadn’t seen any on the subway.  Therefore it is the cheaper iPhones driving Apple profits which Android and Huawei will soon destroy because of Huawei’s epic technical prowess.  

    Given the higher ASP the product mix shows growth in the higher end for both volume and profit.  But we have to ignore ASPs.  Because.
    Not seen one single iPhone X in the wild but it's early days. However, Apple got hit hard in my part of the world. Seeing as Tmay hasn't answered my question I will put it to you.

    How many of those iPhones at the bottom end of Apple's price spread do you think were shipped in this last quarter?

    If we take them out of the balance, how would it have affected the results or do you think that buyers of those phones would have just upped to the next available tier anyway?

    And why do we now have the biggest spread of models available in iPhone history and, a major difference to iPhones past, all of them have enough memory to actually do things with?

    What changed at Apple to justify such an unprecedented change?




    No one could have possibly imagined that was the burning question of your day...

    AFAIK, no one has an interest, yet, in attempting to figure out the full mix of iPhones for the Quarter, but, there are estimates that 29 m were iPhone X, followed by the iPhones 8 and 7. That doesn't leave much room for sales of the SE or the 6, but it wouldn't change my premise anyway and your scenario of pulling out the low end didn't happen in the real world, so we'll never know. But that ASP surely favors my pov.

    Spain, btw, saw a half percent increase in Apple sales, so "hit hard in my part of the world" looks to be a bit of a reversal, and quite a bit of an exaggeration on your part. 

    The smartphone market, worldwide, was down from 437m to 400m YOY for the quarter, yet Apple increased its ASP and had, at the worst, flat sales, depending on counting days in the quarter. Looks like Android OS saw a drop of 37m in unit sales.

    That's an example of "hit hard". 

    As for your "unprecedented change", I would advise that the process of increasing sales tiers has been ongoing since at least 2010. You just need to look closer at the sales history, which i happily provided in the chart.

    Keep doing what your doing if it makes you happy. 

    I'm finished here.
    Apple was hit hard in Spain. That in a historical context. It is no exaggeration. Android remains at over 87% even today. Your 0,5% 'up' is hardly earth shattering and I've seen reports that it was actually 'down'.

    http://www.businessinsider.com/apples-iphone-market-share-in-spain-has-been-all-but-wiped-out-2013-12

    https://www.kantarworldpanel.com/global/smartphone-os-market-share/

    http://www.businessinsider.com/apple-ios-market-share-us-europe-japan-2018-1

    You will see many carrier stores all over the place in Spanish cities. You will be very hard pressed to see an iPhone in any store front window. You will see Huawei and Samsung literally everywhere, though. That is the competition you think isn't relevant against Apple. It is, as you can enter any of those stores and ask for an iPhone and still be swayed away by the seller. Remember that there are hundreds of such stores throughout Spain and relatively few Apple Retail Stores. Apple also has stores within stores but, once again, it has to compete with dozens of Huawei and Samsung models in them. This wasn't always the case. There was a time when it was iPhones on the store fronts and everybody wanted one. Times change.

    ASP in not irrelevant but Apple is looking to shift units. It wants (dare I say, 'needs') to expand into developing markets and retain or improve performance elsewhere. 

    It is the only reason they left so many models in the last revision and I'm sure that you accept that.

    You still haven't answered the questions I put forward. That's fine.

    I did not ask you any 'burning' questions. That is an exaggeration on your part, as was your throwaway 'profitless business models' jab. Unnecessary and deliberate seeing as Muthuk_vanalingam had explicitly stated that he was talking about the middle ground and NOT the low end and had directly said their were profits to be had there. An opinion I share with him 100%. Your barb was unwarranted. Then the 'race to the bottom' line cropped up (yet again!). So, you are going out of your way to make it clear that it isn't about the bottom end, and that profits ARE being had in the middle tiers, that that is where most of the growth is, and people still throw in the race to the bottom! I suspect more high end Android phones shipped last year than ever before. I wonder if I'm right with that suspicion.

    But I will answer the first question I posed even if it isn't 'burning'.

    I took this snippet from the article:

    "Apple's total sales of iPhones in the quarter reached 77.3 million, nearly 4 percent higher than Samsung's despite the introduction of a trio of the most expensive tier of new flagship iPhones ever."

    It was just a snippet and just for the heck of it because when you read these things you know what to expect.

    I asked what wasn't being told in that snippet.

    First. As Apple's sales have largely been flat for a few years, some people simply state that growth in unit sales isn't important. Some point to ASP etc. Anything to take the focus away from the fact - even if the fact itself is brought up. In spite of this, in this snippet 'unit sales' are now valid. The reality is that it's important in the context of the article simply because the numbers are better than Samsung's. If it were the other way around it wouldn't have been mentioned.

    But wait, 4%? For a quarter. That's hardly a significant number. That's not the aim though. The aim is to show it beat Samsung.

    But wait. Are these numbers real? Yes, but they are not Samsung's. They are from an estimate, but not from Samsung. We have someone putting Apple's declared numbers against an estimate from someone completely unrelated to Samsung. Why not wait for Samsung's official numbers before drawing conclusions? They could be even worse than the estimate! The problem is timing. This piece was to spin Apple's numbers in the best possible way and had to appear now for the desired effect. Give the facts as they stand, but focus on what you want to highlight and if it lets you diss Samsung or Google into the bargain, then it's Thunderbirds are go!

    The 4% was good enough to run with. If  Samsung's numbers turn out to be much worse, you can bet there will be a comment on them. If they are better than forecast, well nobody cares about that, right?

    Then, there is perspective. This is just one quarter in the year. It is also Apple's biggest. It always is. With annual sales flat for the last few years and the success story of these results resting largely on initial sales of iPhone X, what are we to expect during this year? There is a possibility that there won't be so much to cheer about over the coming quarters. iPhone X will NOT reach the same levels of performance. Or do you think it could improve its performance? iPhone 8 series is there to tug things along and there is a nice spread of lower end options but both Samsung and Huawei will be releasing new flagships during this period. There is more direct competition between them but Apple is not immune, above all when it comes to increasing unit shipments and would prefer to see Android users switch.

    IMO, Apple is doing what it needs to do.

    Opening up the model spread was key. There was no way they could forge an opening in developing markets without it. You believe that the low end phones did little to impact unit shipments. I believe you are underestimating their relevance and that a few million less units sold would have had a very negative impact on the interpretation of these results but it's impossible to know. The only qualm I have is that they have just one bezeless phone available and hugely expensive. The rest of the line will look decidedly 'old' this year. Personally, that isn't an issue for me but the market is the market. And if Huawei brings its new battery tech to market without licencing it to competitors, we will see if a longer battery lifespan and 50% charge in five minutes proves to be a draw.

    Otherwise, I agree with what they are doing with handsets.

    In other areas there are highs and lows. Services are necessary and doing well but ultimately depend on unit shipments. The Mac is underperforming IMO. The move into content creation could pay off. HomePods and the like will probably add to the bottom line and there will be other products to come.

    We will see how things play out. I don't profess to know.







    It's a bit disingenuous to post a link from 2013 with Apple at 0.5% sales when Spain was considering a bailout from the EU because austerity measures were barely having an effect on turning around Spain's recessionary economy. Let me retort:

    http://money.cnn.com/2012/10/23/news/economy/spain-economy-recession/index.html

    I'm guessing that as Spain regains growth, Apple will continue to see growth in iPhone sales as well, and sure enough, that is the case.

    Subsequently, Apple has increased sales in Spain by 12%. I'm sure that you would state that was due to low end iPhone sales. From my POV, all that is of interest in a declining smartphone market is that Apple is able to maintain ASP. Even with all of sales of Android OS devices, Apple will probably come out with some 80% of the profits in FY2018 for the entire smartphone industry, leaving Samsung and Huawei to fight over the other 20%. 

    Again, if you want me to answer questions wrt this thread, and I would note that I am not a mind reader, you will have to ask these directly. I won't play your little game of "guess what I want you to answer".








    Apple got hit hard here and never recovered. I don't see why you would dispute that. I put things into historical context with the first link but the other two were bang up to date. Android still has more than 87% of the market - today.

    Apple has gained a little, especially with the demise of Windows on mobile with companies renewing fleet phones, but hasn't recovered.

    We went through one of the toughest recessions in recent history but the people affected most by that were people far below Apple's pricing bands. Things are actually more complicated but Apple's demise here has more to do with Samsung and Huawei than anything else.

    Far from exagerrating, I was very reserved when touching this subject. I could have mentioned other EU countries but just limited the comment to my part of the world. in the run up to the end of the year, Apple lost share in many areas of Europe.
    You have a habit of ignoring data that doesn't suit your meme. Apple recovered from 4.3% sales share in 2013 to 12.7% today in Spain. That's a recovery. You are absolutely lying if you can't acknowledge that fact. I doubt that Apple's share was greater than that prior to the recession.

    I agree that Apple did lose a lot of share in Europe during the recession in the EU. In some of EU states, Apple is recovering in; others not, like Britain, and in that case, likely because of Brexit. You would also have to acknowledge that those recessionary conditions don't exist today, all EU states are in growth, and that with the reduction in the value of the dollar, Apple will continue picking up overall share in the EU, just as it is regaining share in China.

    I too acknowledge that having an entry level iPhone increases unit sales and marketshare, but this has been true for seven years. Over those seven years, Apple has been expanding models and both high and low pricing tiers. I think we'll have to agree to disagree, but nowhere have I stated that Apple shouldn't have unit growth, just that Apple's model appears to support the maintenance or extension of ASP over marketshare, and that graph that I linked absolutely demonstrated that.

    That Samsung and Huawei find much lower ASP's acceptable in either their maintenance or growth of units and marketshare, is of little interest to me, other than acknowledgement that it is an important factor in the overall equation.
    One man's recovery is another man's gain:

    https://www.statista.com/statistics/260419/market-share-held-by-smartphone-operating-systems-in-spain/

    As you'll see from the numbers, there is not much changing from 2013-2017.

    I've told you what happened. There was a time when iPhones were in carrier store front windows, on prominent display and visible all over the place. That has all changed. You still see plenty of them around but nothing compared to the amounts of Samsung and Huawei handsets.

    Both my wife and I are on the same carrier. We receive offers every week to upgrade our phones. Always Samsung or Huawei. Other brands are available but we'd have to request them specifically.

    Apple got hit hard because Huawei gives credits to carriers who purchase it's backbone infrastructure. That in turn gives carriers incentives to push Huawei phones and they do. In fact, they push the high end phones for prestige value on the carrier side and then work down to accommodate the clients budget. Right now it's difficult not to see the Mate 10 everywhere you go.
  • Reply 57 of 73
    Rayz2016Rayz2016 Posts: 4,520member
    avon b7 said:

    Not seen one single iPhone X in the wild but it's early days. However, Apple got hit hard in my part of the world. Seeing as Tmay hasn't answered my question I will put it to you.

    How many of those iPhones at the bottom end of Apple's price spread do you think were shipped in this last quarter?

    If we take them out of the balance, how would it have affected the results or do you think that buyers of those phones would have just upped to the next available tier anyway?

    And why do we now have the biggest spread of models available in iPhone history and, a major difference to iPhones past, all of them have enough memory to actually do things with?

    What changed at Apple to justify such an unprecedented change?


    "Unprecedented"?

    Apple has sold a varying spread of iPhones and iPods and whatever else since Jobs was in charge. (The iPads seem to get this a lot). As well as offering different products according to budget, this does seem to occur when they're switching from one piece of tech, to something new. In this case, we have the iPhoneX which introduces wireless charging, FaceID, OLED… We always see a shortage of components to build the new kit, so until the supply line gets the hang of it, Apple runs expanded products bands. As it settles down, the bands shrink to cover the new models at three levels. Nothing new at all.

    Increased memory? Since the kit now has to do a lot more than it did five years ago, then it needs more memory. They're doing a lot of onboard processing for AI and graphics for AI.  The reason that Apple has not fitted so much memory is because they didn't need to. Android apps are written in Java and required a JVM to run; Apple apps run closer to the metal. Apple processors are optimised for running iOS; the chips in Android phones are off the shelf. 

    I think the problem you have with making an argument is that you tend to do it in reverse. You look for a position you want to prove, and the scramble around looking for unrelated scraps of evidence to support it.

    Sorry if I have this wrong, but weren't you the chap who read a statement that Tim Cook made about the iPhoneX? You then spent a couple of posts insisting that the iPhoneX was some sort of anniversary model that Apple could/would abandon if it had to, even though Cook had not said anything about it being an anniversary phone in the interview. You were trying to shoehorn the argument that Apple may at some point return to TouchID, even though Cook and others long stated that they view TouchID as legacy technology. 

    A well-formed argument involves looking at the evidence and drawing conclusions; not looking for the answers you want and then reading tea leaves for snippets of information that support it. 

    This is a very common trait amongst Android supporters, especially when they see a piece of tech that is not common on their platform. They convince themselves that things like Touch ID on the back of the phone is the very best solution possible, then they spend a lot of time in Apple forums trying to prove that Apple must go the same way or all is lost. It surprises me how many Android users need to convince Apple users that their choice is the right one. It's almost as if you need Apple fans approval to vindicate your own choice of platform.

    You don't. Just enjoy it.


    tmay
  • Reply 58 of 73
    Rayz2016 said:
    avon b7 said:

    Not seen one single iPhone X in the wild but it's early days. However, Apple got hit hard in my part of the world. Seeing as Tmay hasn't answered my question I will put it to you.

    How many of those iPhones at the bottom end of Apple's price spread do you think were shipped in this last quarter?

    If we take them out of the balance, how would it have affected the results or do you think that buyers of those phones would have just upped to the next available tier anyway?

    And why do we now have the biggest spread of models available in iPhone history and, a major difference to iPhones past, all of them have enough memory to actually do things with?

    What changed at Apple to justify such an unprecedented change?


    "Unprecedented"?

    Apple has sold a varying spread of iPhones and iPods and whatever else since Jobs was in charge. (The iPads seem to get this a lot). As well as offering different products according to budget, this does seem to occur when they're switching from one piece of tech, to something new. In this case, we have the iPhoneX which introduces wireless charging, FaceID, OLED… We always see a shortage of components to build the new kit, so until the supply line gets the hang of it, Apple runs expanded products bands. As it settles down, the bands shrink to cover the new models at three levels. Nothing new at all.

    Increased memory? Since the kit now has to do a lot more than it did five years ago, then it needs more memory. They're doing a lot of onboard processing for AI and graphics for AI.  The reason that Apple has not fitted so much memory is because they didn't need to. Android apps are written in Java and required a JVM to run; Apple apps run closer to the metal. Apple processors are optimised for running iOS; the chips in Android phones are off the shelf. 

    I think the problem you have with making an argument is that you tend to do it in reverse. You look for a position you want to prove, and the scramble around looking for unrelated scraps of evidence to support it.

    Sorry if I have this wrong, but weren't you the chap who read a statement that Tim Cook made about the iPhoneX? You then spent a couple of posts insisting that the iPhoneX was some sort of anniversary model that Apple could/would abandon if it had to, even though Cook had not said anything about it being an anniversary phone in the interview. You were trying to shoehorn the argument that Apple may at some point return to TouchID, even though Cook and others long stated that they view TouchID as legacy technology. 

    A well-formed argument involves looking at the evidence and drawing conclusions; not looking for the answers you want and then reading tea leaves for snippets of information that support it. 

    This is a very common trait amongst Android supporters, especially when they see a piece of tech that is not common on their platform. They convince themselves that things like Touch ID on the back of the phone is the very best solution possible, then they spend a lot of time in Apple forums trying to prove that Apple must go the same way or all is lost. It surprises me how many Android users need to convince Apple users that their choice is the right one. It's almost as if you need Apple fans approval to vindicate your own choice of platform.

    You don't. Just enjoy it.

    Actually, this thread has taken a substantial turn, from my initial post!!! What I mentioned in my first post was fairly simple - Apple's unit sales have NOT increased in last 2.5 years. The revenue/profit increase observed in last 2.5 years is predominantly due to ASP increase, which will hit a wall pretty soon than later. And for "growth", Apple will have to look for increase in unit sales. I also said this is a new challenge, compared to the initial 7 years of iPhones when "unit sales" increased year on year. It is going to take a different strategy than the current one, to spur "growth".

  • Reply 59 of 73
    avon b7avon b7 Posts: 3,075member
    Rayz2016 said:
    avon b7 said:

    Not seen one single iPhone X in the wild but it's early days. However, Apple got hit hard in my part of the world. Seeing as Tmay hasn't answered my question I will put it to you.

    How many of those iPhones at the bottom end of Apple's price spread do you think were shipped in this last quarter?

    If we take them out of the balance, how would it have affected the results or do you think that buyers of those phones would have just upped to the next available tier anyway?

    And why do we now have the biggest spread of models available in iPhone history and, a major difference to iPhones past, all of them have enough memory to actually do things with?

    What changed at Apple to justify such an unprecedented change?


    "Unprecedented"?

    Apple has sold a varying spread of iPhones and iPods and whatever else since Jobs was in charge. (The iPads seem to get this a lot). As well as offering different products according to budget, this does seem to occur when they're switching from one piece of tech, to something new. In this case, we have the iPhoneX which introduces wireless charging, FaceID, OLED… We always see a shortage of components to build the new kit, so until the supply line gets the hang of it, Apple runs expanded products bands. As it settles down, the bands shrink to cover the new models at three levels. Nothing new at all.

    Increased memory? Since the kit now has to do a lot more than it did five years ago, then it needs more memory. They're doing a lot of onboard processing for AI and graphics for AI.  The reason that Apple has not fitted so much memory is because they didn't need to. Android apps are written in Java and required a JVM to run; Apple apps run closer to the metal. Apple processors are optimised for running iOS; the chips in Android phones are off the shelf. 

    I think the problem you have with making an argument is that you tend to do it in reverse. You look for a position you want to prove, and the scramble around looking for unrelated scraps of evidence to support it.

    Sorry if I have this wrong, but weren't you the chap who read a statement that Tim Cook made about the iPhoneX? You then spent a couple of posts insisting that the iPhoneX was some sort of anniversary model that Apple could/would abandon if it had to, even though Cook had not said anything about it being an anniversary phone in the interview. You were trying to shoehorn the argument that Apple may at some point return to TouchID, even though Cook and others long stated that they view TouchID as legacy technology. 

    A well-formed argument involves looking at the evidence and drawing conclusions; not looking for the answers you want and then reading tea leaves for snippets of information that support it. 

    This is a very common trait amongst Android supporters, especially when they see a piece of tech that is not common on their platform. They convince themselves that things like Touch ID on the back of the phone is the very best solution possible, then they spend a lot of time in Apple forums trying to prove that Apple must go the same way or all is lost. It surprises me how many Android users need to convince Apple users that their choice is the right one. It's almost as if you need Apple fans approval to vindicate your own choice of platform.

    You don't. Just enjoy it.


    1. '''unprecedented". Yes. This is the biggest spread in iPhone history and represents a major shift in approach.

    2. "Increased memory". No. It's not the increased memory. It's the fact that, out of the gate you can actually make better use of the phone now. When phones were, for example, at 8GB and 16GB starters with their respective systems on board, they were practically crippled due to space limitations. That situation isn't as bad now.

    3. iPhone X. Anniversary model. The term was in the (first?) Paragraph of the AI article in question.

    4. TouchID. Legacy? No. Apple released three completely new phones last year. Two have TouchID.

    5. We'll formed arguments. Professionally speaking, part of my job is preparing people to argue for or against certain things. I am very good at what I do. I support pretty much everything I say when it is factual or rooted in fact. Opinions are a different matter, of course. Some people don't know how to separate the two, wilfully take things the wrong way to support their own objectives, confuse them accidentally etc. The reality is I am not a professional AI forum poster. Most of the time I'm sitting on a train between visits and pick up on some threads on my phone while doing other things. Sometimes, things can legitimately be interpreted in various ways. However, once the edit window has closed its too late. I am very tolerant of people and individual styles. I don't get into tit for tat insult flinging and don't gloat when pointing out someone is just plain wrong. I give everyone the benefit of the doubt but, as I said, some people just wilfully try to distort things or come in with chips on their shoulders.

    People are people. There are no common traits to iPhone users or Android users much less in posting style. You will find the same traits everywhere, at least in this context. We can look for traits in types of people, or on a cultural level but I know what you are getting at and it isn't such a big deal. I try to take your comments into the bigger picture and not not pick over things like 'anniversary' iPhones, unless someone picks up on those kinds of things and starts poking the finger.

    6. TouchID (again). I have stated on countless occasions that the placement of the scanner is preference. I have defended the rear placement (my preference) when someone has tried to claim a front mounted sensor is 'better'. I have countered those arguments with my view and IIRC not one single person has been able to counter what I have presented.

    7. I have two active Android devices right now but heaps of macOS and iOS devices. Calling me an Android user as if it were my only system isn't really correct. Calling me a Mac user would be, as I have never owned a Windows machine in my life. I use macOS, Android and iOS daily. This fact might grind on some as I do not 'worship' any company and don't go on the defensive when someone says something bad about Apple, Samsung, Huawei or whatever. That said, when people go overboard in certain areas, I inject some balance and point out that things aren't really as they are proclaiming.

    It's also worth noting that I post in relatively few threads because I don't have time to follow up on everything and even then some stuff falls off my radar.

    8. I don't need or seek the approval of anybody. It's not 'almost if' either. Also, if you need to scramble when defending a position you lost it before you started. 
    edited February 2018
  • Reply 60 of 73
    tmaytmay Posts: 3,343member
    Rayz2016 said:
    avon b7 said:

    Not seen one single iPhone X in the wild but it's early days. However, Apple got hit hard in my part of the world. Seeing as Tmay hasn't answered my question I will put it to you.

    How many of those iPhones at the bottom end of Apple's price spread do you think were shipped in this last quarter?

    If we take them out of the balance, how would it have affected the results or do you think that buyers of those phones would have just upped to the next available tier anyway?

    And why do we now have the biggest spread of models available in iPhone history and, a major difference to iPhones past, all of them have enough memory to actually do things with?

    What changed at Apple to justify such an unprecedented change?


    "Unprecedented"?

    Apple has sold a varying spread of iPhones and iPods and whatever else since Jobs was in charge. (The iPads seem to get this a lot). As well as offering different products according to budget, this does seem to occur when they're switching from one piece of tech, to something new. In this case, we have the iPhoneX which introduces wireless charging, FaceID, OLED… We always see a shortage of components to build the new kit, so until the supply line gets the hang of it, Apple runs expanded products bands. As it settles down, the bands shrink to cover the new models at three levels. Nothing new at all.

    Increased memory? Since the kit now has to do a lot more than it did five years ago, then it needs more memory. They're doing a lot of onboard processing for AI and graphics for AI.  The reason that Apple has not fitted so much memory is because they didn't need to. Android apps are written in Java and required a JVM to run; Apple apps run closer to the metal. Apple processors are optimised for running iOS; the chips in Android phones are off the shelf. 

    I think the problem you have with making an argument is that you tend to do it in reverse. You look for a position you want to prove, and the scramble around looking for unrelated scraps of evidence to support it.

    Sorry if I have this wrong, but weren't you the chap who read a statement that Tim Cook made about the iPhoneX? You then spent a couple of posts insisting that the iPhoneX was some sort of anniversary model that Apple could/would abandon if it had to, even though Cook had not said anything about it being an anniversary phone in the interview. You were trying to shoehorn the argument that Apple may at some point return to TouchID, even though Cook and others long stated that they view TouchID as legacy technology. 

    A well-formed argument involves looking at the evidence and drawing conclusions; not looking for the answers you want and then reading tea leaves for snippets of information that support it. 

    This is a very common trait amongst Android supporters, especially when they see a piece of tech that is not common on their platform. They convince themselves that things like Touch ID on the back of the phone is the very best solution possible, then they spend a lot of time in Apple forums trying to prove that Apple must go the same way or all is lost. It surprises me how many Android users need to convince Apple users that their choice is the right one. It's almost as if you need Apple fans approval to vindicate your own choice of platform.

    You don't. Just enjoy it.

    Actually, this thread has taken a substantial turn, from my initial post!!! What I mentioned in my first post was fairly simple - Apple's unit sales have NOT increased in last 2.5 years. The revenue/profit increase observed in last 2.5 years is predominantly due to ASP increase, which will hit a wall pretty soon than later. And for "growth", Apple will have to look for increase in unit sales. I also said this is a new challenge, compared to the initial 7 years of iPhones when "unit sales" increased year on year. It is going to take a different strategy than the current one, to spur "growth".

    It's also true that overall, both iPhone users and Android OS users are keeping their devices longer, that Android OS unit sales fell for the quarter 9%, while Apple's were at worst "flat", and that in a mature market, there's no odds in gaining marketshare without maintaining ASP. Significantly, iPhones generated better values at trade in, and there are large and active markets for both refurbished iPhones and used iPhones, a substantial portion of which support 64 bit, necessary to current iOS releases. In India, Apple was foiled in its desire to market refurbished products, and has a nascent manufacturing operation in place. How much growth and how fast that growth will be created is unknown, but, this is an example of attempting to meet market needs.

    What you, and others fail to consider or mention, is that Apple is already leading in wearables, which is the natural follow on to smartphone. Will they be successful in yet another disruption like the iPhone in the future? I don't know, though their track record is pretty good.

    So, I agree that unit growth will be a challenge, but the remedy posed by most of these Monday Morning Quarterbacks, a rush to even lower cost iPhones, is a roadmap to failure.

    Yet another chart from Horace:




    Apple is projecting unit growth for next quarter.

    and another link to Horace:

    http://www.asymco.com/2018/02/05/apple-remarks-to-investors-in-fq1-2018-earnings-conference-call-categorized-and-annotated/

    In that is that same chart I posted earlier, updated for the ASP increase and the high and low tier product.
    edited February 2018
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