melgross said: ... Are you saying that Apple is incapable of designing, and making a new $350 phone, because I doubt that. It’s a matter of will, not ability.
... Those of you who want to stick to the outdated notion that Apple MUST only compete on the high end should be seeing what problems that’s causing.
They did with the original iPhone SE. They did it with the iPad (2018) and now the mini (2019). They have done it in the past for various desktops and laptops. They have never been cheap, or competed with the lowest end of a market, but they were competitive and not just high-end.
I'm pretty sure when Steve was talking about 'not making junk' he wasn't saying he wanted the products only to be affordable for the wealthy. He was saying pretty much what he said... don't make junk. There is a difference between junk and creating a quality product for different market positions. Sure, depending on the product, you might not ever be able to go under some $ amount, but I really doubt $350 is it for a phone.
Nobody is talking about them making junk. A $350 phone isn’t junk. An $80 phone may be junk, when you’re talking about a smartphone. When we talk about these countries, we’re talking about people who can’t often even spend $350 on a phone. If Apple expects to do well there they have to sell what people can buy. That’s pretty simple, and nobody saying otherwise gets it. We have to stop being so stuck up about this. Apple, I’m sure, is looking into this. But if they’re so worried about their image, then they’ll never succeed there.
A $350 phone without iOS and Apple's ecosystem is junk. Apple could put out a quality $350 phone and then charge you hundred or two or three for the software and ecosystem needed to make it great.
George, that makes no sense. A phone without software is an incomplete device. So you’re still talking about a $550 phone. I’m not sure if you were serious with this or something else.
apple can make a $350 phone. The selling price of the SE proves it. It doesn’t need the latest SoC. It doesn’t need the most expensive LCD. It doesn’t need the most storage. It can use a polycarbonate case. Apple has already done that, and it proved more popular than they expected.
Yes, it is incomplete -- and to make it complete you have to spend (say) $550. I not only agree with that, but it was my point! That is: You are not considering the cost TO APPLE of their software and ecosystem because they bury it in the price of the "device". But the device is a combination of hardware, software and ecosystem -- each of which is non-trivial.
And yes, they did sell the SE for $350 -- but only by leveraging already existing technology and manufacturing processes. That means it looked new but was old -- or became old because it was never updated. Apple is using the same technique with the 2018 Gen6 iPad.
No. YOURE saying it would cost that much. Frankly, that’s just your numbers, and they mean nothing. You need to look at reality, not what you believe is reality, which this isn’t. Are you really saying that all that time Apple was selling the SE for $350–$400, they were losing $200 per phone? Because if you are, then we can all have a good laugh at that.
I don't think I said that. I pointed out that developing and maintaining APple's software and ecosystem cost money. The numbers were a hypothetical example that you are now trying to distort.
But, while I don't see Apple taking your approach with iPhones or iPads, (new and cheap), it could have benefit in their Mac line since those are pretty much just off-the-shelf hardware anyway and Apple could stick in almost anything they wanted in order to get volume up and bring fixed costs down.
GeorgeBMac said: Yes, it costs very little to INSTALL iOS on a phone. with that I agree.
But if you mean it costs very little to develop and maintain iOS I strongly disagree. It costs a lot. And, on a unit basis far more than either a Windows OS or Android because they go on so many more units. And, then you get to the cost of the ecosystem which is equally costly to Apple.
Because we think Apple gives them away, we tend to under estimate their cost and their value.
Yes, but that also means the more Apple sells, the better those costs are diminished vs the profit they make. They have to have already developed that eco-system and software whether they sell a 10 million phones, or 100 million. The cost of the eco-system scale/use and support costs do go up, but once developed, the software itself and OS are essentially free for Apple to duplicate as much as possible (since they had to do it anyway).
GeorgeBMac said: And yes, they did sell the SE for $350 -- but only by leveraging already existing technology and manufacturing processes. That means it looked new but was old -- or became old because it was never updated. Apple is using the same technique with the 2018 Gen6 iPad.
But, what's wrong with doing that more? That's exactly what we're arguing... take an existing design, put newer stuff in it, leverage that existing tech and manufacturing. Apple seems to be the one who thinks they have to come up with new 'revolutionary' designs each iteration. I'm quite happy with my SE and 2018 Gen6 iPad.
GeorgeBMac said: But, you are only talking about the cost of the hardware. An iPhone without Apple's software and ecosystem is not an iPhone -- and both of those, although buried in the price of the "device", is very costly to Apple. Rather, hey comprise a major part of the cost to Apple.
... But the discussion was about Apple selling a cheap NEW product instead of marketing older devices.
Yes, but once done, the cost to duplicate it on more devices (for which they make money) is effectively zero.
But, I see what you mean with the 'NEW' comment. I wasn't so much talking about a completely new design. For example, they could use the 5c design and just put a modern chip in it, maybe update a couple of other components, etc. Though, they'd have to run the numbers. Maybe designing ground-up something completely aimed at that market would make sense, many not. I'm just saying that I don't think they would need to.
GeorgeBMac said: In the meantime, leveraging the already paid for fixed expenses of older devices has been working well for them to increase the volume you are speaking of.
Yes, but at the cost of UX. Apple is damaging their brand, IMO, for short-term gain. An older, lower-feature, design with a new chip is a great user experience (except for feature lack). An old model compromises the user experience (slower), and impacts the product longevity.
GeorgeBMac said: Yes, it costs very little to INSTALL iOS on a phone. with that I agree.
But if you mean it costs very little to develop and maintain iOS I strongly disagree. It costs a lot. And, on a unit basis far more than either a Windows OS or Android because they go on so many more units. And, then you get to the cost of the ecosystem which is equally costly to Apple.
Because we think Apple gives them away, we tend to under estimate their cost and their value.
Yes, but that also means the more Apple sells, the better those costs are diminished vs the profit they make. They have to have already developed that eco-system and software whether they sell a 10 million phones, or 100 million. The cost of the eco-system scale/use and support costs do go up, but once developed, the software itself and OS are essentially free for Apple to duplicate as much as possible (since they had to do it anyway).
GeorgeBMac said: And yes, they did sell the SE for $350 -- but only by leveraging already existing technology and manufacturing processes. That means it looked new but was old -- or became old because it was never updated. Apple is using the same technique with the 2018 Gen6 iPad.
But, what's wrong with doing that more? That's exactly what we're arguing... take an existing design, put newer stuff in it, leverage that existing tech and manufacturing. Apple seems to be the one who thinks they have to come up with new 'revolutionary' designs each iteration. I'm quite happy with my SE and 2018 Gen6 iPad.
GeorgeBMac said: But, you are only talking about the cost of the hardware. An iPhone without Apple's software and ecosystem is not an iPhone -- and both of those, although buried in the price of the "device", is very costly to Apple. Rather, hey comprise a major part of the cost to Apple.
... But the discussion was about Apple selling a cheap NEW product instead of marketing older devices.
Yes, but once done, the cost to duplicate it on more devices (for which they make money) is effectively zero.
But, I see what you mean with the 'NEW' comment. I wasn't so much talking about a completely new design. For example, they could use the 5c design and just put a modern chip in it, maybe update a couple of other components, etc. Though, they'd have to run the numbers. Maybe designing ground-up something completely aimed at that market would make sense, many not. I'm just saying that I don't think they would need to.
GeorgeBMac said: In the meantime, leveraging the already paid for fixed expenses of older devices has been working well for them to increase the volume you are speaking of.
Yes, but at the cost of UX. Apple is damaging their brand, IMO, for short-term gain. An older, lower-feature, design with a new chip is a great user experience (except for feature lack). An old model compromises the user experience (slower), and impacts the product longevity.
Yes, that is true -- the more they sell the lower those mostly fixed costs for software and ecosystem go on a per unit basis. I've been harping on that here and elsewhere for awhile now.
But, the question is: how to get there (assuming that they want to)
I would say leveraging the cost advantage of older designs provides the most effective avenue. While the external design doesn't change the cost much, the cost of manufacturing the internals such as the chips do... I think the new Mini is a good example. It is likely as cheap as Apple can go -- but still more than the larger Gen6 9.7" iPad.
Just as the cost of the software and ecosystem comprise a major part of the cost of Apple's products, so does the investment in the facilities to manufacture them. Apple can best leverage the latter most effectively. And, since the newer processors are so powerful, having a generation or 2 back does not overly impact the experience of most users browsing the web or Facebook.
melgross said: I think they should do both. Why shut themselves out of markets? Look at all the problems they have selling in India. They had a phone they were selling for $350. Then they discontinued it. There’s no sense in that. Why make a push in a country that can’t afford the products without having a product that they can afford? And the gold models were popular there, and elsewhere, and now they are no more either.
Yeah, I don't know. It doesn't make much overall sense. Maybe they are just trying to raise the average selling price to make the Wall Street people happy.
They certainly could do both, and I think they would be better for it. I'd much rather see a true lower cost model than selling outdated tech at lower prices.
The iPad line is now kind of like that, so I'm not sure why they can't do the same with phones. The big thing for me, though, is decoupling the form-factor from the price. I don't want the size device I pick to determine the feature set (or limited features set) because some schmuck at Apple has decided small screens should be 'budget' devices. That's just a stupid notion they need to break free from.
There are ramifications there... Selling a cheap product also means one that doesn't have the quality or reserve power of a standard product. That would drag Apple down to be just another manufacturer of junk -- which would impact the reputation (how people think) of the core products. It's why car manufacturers have separate companies for high end vs lower end products. The name "Cadillac" still has meaning...
Conversely, by selling older products they are leveraging existing facilities and technology without sacrificing quality. That is: the development work and manufacturing facilities and training for the iPhone 8 are done and paid for and they can use them for free or very low cost -- while supplying a high quality product.
And actually, both the iPhone SE and the iPad Gen 6 did just that: Although they were marketed as brand new products, the technology and internals were older and they did or will continue to leverage them for years. So, they can still sell a high quality product at a low cost.
That’s just doesn’t make sense. I repeat, why make a major sales, and manufacturing push (required there to sell independently) in a poor, but very large country, if you have no products that more than a tiny part of the population can buy? Not everyone wants to but 4 years old products at a lower price. Are you saying that Apple is incapable of designing, and making a new $350 phone, because I doubt that. It’s a matter of will, not ability.
yes, if Apple was only selling in wealthy countries, that experience shows will but these products in good numbers, then it makes sense to not sell a lower priced product. But not when we’re talking about India, and other countries Apple is trying to have a major impact in since the China angle is becoming difficult, both politically, and competitively.
this is very simple, and well understood business sense. Those of you who want to stick to the outdated notion that Apple MUST only compete on the high end should be seeing what problems that’s causing.
I don't think that they can -- because of two things: 1) Expected quality of materials, design and manufacture. 2) The cost of the software and ecosystem that accompanies every phone -- but is too often ignored. Instead, we compare a knock-off to an iPhone. It's not the hardware that makes iPhones great. It's the software and ecosystem -- and they cost money.
Or, to put it more succinctly: Could Apple make a brand new, state of the art phone for $350? YES! But only if they installed an Android OS and omitted all of Apple's ecosystem.
It costs Apple very little to put iOS on a phone, or their software. All of which is being given away for free, and that costs very little to supply.
just remember that it’s Apple that’s trying very hard to break into these markets. What I’m reading here makes no sense once you consider that. It’s not as though we’re talking about Apple breaking into those markets with Apple not being interested. Then it would just be our discussion. But it’s not. It’s Apple. So the question is why they’re not successful now. The main reason is price. It’s pretty simple. So there has to be a way for them to break into that market in a big enough way.
if you don’t like the idea of a less expensive product line, what is it that you do suggest? And try to be realistic.
Yes, it costs very little to INSTALL iOS on a phone. with that I agree. But if you mean it costs very little to develop and maintain iOS I strongly disagree. It costs a lot. And, on a unit basis far more than either a Windows OS or Android because they go on so many more units. And, then you get to the cost of the ecosystem which is equally costly to Apple.
Because we think Apple gives them away, we tend to under estimate their cost and their value.
Then that’s missing the point. The more devices it’s distributed in the less it costs per device. I understand how this works from my own businesses. R&D costs, whether hardware of software related are fixed for the year. Distribute it to 300 million devices and it costs so much per device. Distribute it between 500 million devices and it costs considerably less per device. That works out for their most expensive devices to their least expensive ones. Usually, the most expensive devices are assigned more of those costs per device than the lower cost devices are.
and it’s strange, because you basically just destroyed your own argument.
LOL... No, I didn't destroy anything. In addition to pointing out how volume impacts the per unit costs of mostly fixed costs, I acnowledged the reality of the situation -- that the quantities you are alluding to do not exist in the Apple world like they do in the Android or Windows worlds. And, to get there, Apple would need to take on a very different marketing model -- one that is very foreign to them.
In the meantime, leveraging the already paid for fixed expenses of older devices has been working well for them to increase the volume you are speaking of.
They exist for Apple, just as they do for anyone else. When you get to the level of selling over 200 million phones a year, with just a few models, you spread costs much more easily. I remember that when Nokia still ruled the roost, they had the highest R&D budget. But that budget was spread over an astounding 225 phone models. Yes, they were in various families, and each family shared a large part of the R&D for that family. Still each phone had different hardware, cases, and software. Apple has just a very few models.
putting software on more phones results in very little incremental costs. I get this. I was a manufacturer.
a while ago, Tim was asked about making cheaper phones. He repeated what Steve said, which had nothing to do with the concept of “junk”. It was, he said whether Apple could contribute something unique to that price level. If they thought they could, they would. If not, they wouldn’t enter the category.
that’s all well and good when sales for the industry are growing robustly, as they were for years after the iPhone came out. But now, industry sales are not growing, in fact, they’re down. When that happens, you have to rethink your strategy. Why does Apple have to have something unique in that category? Why not just produce a very good phone for the money, with Apple’s brand?
it may be getting to the point where nobody’s new phone, at any price, is all that much ahead of anyone else’s phone at that price.
and Apple’s problem now is that their highest growth area; greater China, has Chinese manufacturers that are competing much better than a few years ago. In addition, WeChat and Alibaba’s apps are being used for everything over there, making both Android and iOS almost irrelevant. That hurts Apple’s competitiveness. The Chinese government likes that because they can easily track everything that goes through those two apps. Chinese people don’t care because, according to a number of video reports from China I’ve seen, people’s attitude there is that if you keep your nose clean, it doesn’t matter. Here, People’s attitude is just the opposite, they’re worried that if they do something illegal the government might find out. What a difference.
these problems have forced Apple to turn to India. They really weren’t that interested until the China turn occurred. But India is far poorer than China. Apple can’t use the same marketing and sales policies there. And India is requiring them to bend over backwards in order to have their own stores, and to sell certain models. So Apple is spending billions on doing that. What are they going to sell? That’s what we need the answer to, because it’s not most of what Apple sells now.
from what you’re saying, Apple should pull out of most of the world because they can’t afford most of Apple’s hardware and services. I haven’t seen you come up with an answer, just a denial of the only answer Apple has.
melgross said: ... Are you saying that Apple is incapable of designing, and making a new $350 phone, because I doubt that. It’s a matter of will, not ability.
... Those of you who want to stick to the outdated notion that Apple MUST only compete on the high end should be seeing what problems that’s causing.
They did with the original iPhone SE. They did it with the iPad (2018) and now the mini (2019). They have done it in the past for various desktops and laptops. They have never been cheap, or competed with the lowest end of a market, but they were competitive and not just high-end.
I'm pretty sure when Steve was talking about 'not making junk' he wasn't saying he wanted the products only to be affordable for the wealthy. He was saying pretty much what he said... don't make junk. There is a difference between junk and creating a quality product for different market positions. Sure, depending on the product, you might not ever be able to go under some $ amount, but I really doubt $350 is it for a phone.
Nobody is talking about them making junk. A $350 phone isn’t junk. An $80 phone may be junk, when you’re talking about a smartphone. When we talk about these countries, we’re talking about people who can’t often even spend $350 on a phone. If Apple expects to do well there they have to sell what people can buy. That’s pretty simple, and nobody saying otherwise gets it. We have to stop being so stuck up about this. Apple, I’m sure, is looking into this. But if they’re so worried about their image, then they’ll never succeed there.
A $350 phone without iOS and Apple's ecosystem is junk. Apple could put out a quality $350 phone and then charge you hundred or two or three for the software and ecosystem needed to make it great.
George, that makes no sense. A phone without software is an incomplete device. So you’re still talking about a $550 phone. I’m not sure if you were serious with this or something else.
apple can make a $350 phone. The selling price of the SE proves it. It doesn’t need the latest SoC. It doesn’t need the most expensive LCD. It doesn’t need the most storage. It can use a polycarbonate case. Apple has already done that, and it proved more popular than they expected.
Yes, it is incomplete -- and to make it complete you have to spend (say) $550. I not only agree with that, but it was my point! That is: You are not considering the cost TO APPLE of their software and ecosystem because they bury it in the price of the "device". But the device is a combination of hardware, software and ecosystem -- each of which is non-trivial.
And yes, they did sell the SE for $350 -- but only by leveraging already existing technology and manufacturing processes. That means it looked new but was old -- or became old because it was never updated. Apple is using the same technique with the 2018 Gen6 iPad.
No. YOURE saying it would cost that much. Frankly, that’s just your numbers, and they mean nothing. You need to look at reality, not what you believe is reality, which this isn’t. Are you really saying that all that time Apple was selling the SE for $350–$400, they were losing $200 per phone? Because if you are, then we can all have a good laugh at that.
I don't think I said that. I pointed out that developing and maintaining APple's software and ecosystem cost money. The numbers were a hypothetical example that you are now trying to distort.
But, while I don't see Apple taking your approach with iPhones or iPads, (new and cheap), it could have benefit in their Mac line since those are pretty much just off-the-shelf hardware anyway and Apple could stick in almost anything they wanted in order to get volume up and bring fixed costs down.
I’m not distorting anything. You said the software should add $100 to $300 to the price of the phone. I took a middle number from YOUR numbers. Then later you even said, yes that $350 phone should cost $550, because of the software. So you’re acknowledging what you said with those numbers, unless you’re going to change your posts, but they’re in my response, right above.
Now, you’re saying you didn’t mean what you said? Well, exactly what did you mean, because you made it very clear in two posts.
why, instead of arguing with what I’m saying, don’t you tell us your solution, because so far, all you’re doing is denying that there is a solution.
melgross said: I think they should do both. Why shut themselves out of markets? Look at all the problems they have selling in India. They had a phone they were selling for $350. Then they discontinued it. There’s no sense in that. Why make a push in a country that can’t afford the products without having a product that they can afford? And the gold models were popular there, and elsewhere, and now they are no more either.
Yeah, I don't know. It doesn't make much overall sense. Maybe they are just trying to raise the average selling price to make the Wall Street people happy.
They certainly could do both, and I think they would be better for it. I'd much rather see a true lower cost model than selling outdated tech at lower prices.
The iPad line is now kind of like that, so I'm not sure why they can't do the same with phones. The big thing for me, though, is decoupling the form-factor from the price. I don't want the size device I pick to determine the feature set (or limited features set) because some schmuck at Apple has decided small screens should be 'budget' devices. That's just a stupid notion they need to break free from.
There are ramifications there... Selling a cheap product also means one that doesn't have the quality or reserve power of a standard product. That would drag Apple down to be just another manufacturer of junk -- which would impact the reputation (how people think) of the core products. It's why car manufacturers have separate companies for high end vs lower end products. The name "Cadillac" still has meaning...
Conversely, by selling older products they are leveraging existing facilities and technology without sacrificing quality. That is: the development work and manufacturing facilities and training for the iPhone 8 are done and paid for and they can use them for free or very low cost -- while supplying a high quality product.
And actually, both the iPhone SE and the iPad Gen 6 did just that: Although they were marketed as brand new products, the technology and internals were older and they did or will continue to leverage them for years. So, they can still sell a high quality product at a low cost.
That’s just doesn’t make sense. I repeat, why make a major sales, and manufacturing push (required there to sell independently) in a poor, but very large country, if you have no products that more than a tiny part of the population can buy? Not everyone wants to but 4 years old products at a lower price. Are you saying that Apple is incapable of designing, and making a new $350 phone, because I doubt that. It’s a matter of will, not ability.
yes, if Apple was only selling in wealthy countries, that experience shows will but these products in good numbers, then it makes sense to not sell a lower priced product. But not when we’re talking about India, and other countries Apple is trying to have a major impact in since the China angle is becoming difficult, both politically, and competitively.
this is very simple, and well understood business sense. Those of you who want to stick to the outdated notion that Apple MUST only compete on the high end should be seeing what problems that’s causing.
I don't think that they can -- because of two things: 1) Expected quality of materials, design and manufacture. 2) The cost of the software and ecosystem that accompanies every phone -- but is too often ignored. Instead, we compare a knock-off to an iPhone. It's not the hardware that makes iPhones great. It's the software and ecosystem -- and they cost money.
Or, to put it more succinctly: Could Apple make a brand new, state of the art phone for $350? YES! But only if they installed an Android OS and omitted all of Apple's ecosystem.
It costs Apple very little to put iOS on a phone, or their software. All of which is being given away for free, and that costs very little to supply.
just remember that it’s Apple that’s trying very hard to break into these markets. What I’m reading here makes no sense once you consider that. It’s not as though we’re talking about Apple breaking into those markets with Apple not being interested. Then it would just be our discussion. But it’s not. It’s Apple. So the question is why they’re not successful now. The main reason is price. It’s pretty simple. So there has to be a way for them to break into that market in a big enough way.
if you don’t like the idea of a less expensive product line, what is it that you do suggest? And try to be realistic.
Yes, it costs very little to INSTALL iOS on a phone. with that I agree. But if you mean it costs very little to develop and maintain iOS I strongly disagree. It costs a lot. And, on a unit basis far more than either a Windows OS or Android because they go on so many more units. And, then you get to the cost of the ecosystem which is equally costly to Apple.
Because we think Apple gives them away, we tend to under estimate their cost and their value.
Then that’s missing the point. The more devices it’s distributed in the less it costs per device. I understand how this works from my own businesses. R&D costs, whether hardware of software related are fixed for the year. Distribute it to 300 million devices and it costs so much per device. Distribute it between 500 million devices and it costs considerably less per device. That works out for their most expensive devices to their least expensive ones. Usually, the most expensive devices are assigned more of those costs per device than the lower cost devices are.
and it’s strange, because you basically just destroyed your own argument.
LOL... No, I didn't destroy anything. In addition to pointing out how volume impacts the per unit costs of mostly fixed costs, I acnowledged the reality of the situation -- that the quantities you are alluding to do not exist in the Apple world like they do in the Android or Windows worlds. And, to get there, Apple would need to take on a very different marketing model -- one that is very foreign to them.
In the meantime, leveraging the already paid for fixed expenses of older devices has been working well for them to increase the volume you are speaking of.
They exist for Apple, just as they do for anyone else. When you get to the level of selling over 200 million phones a year, with just a few models, you spread costs much more easily. I remember that when Nokia still ruled the roost, they had the highest R&D budget. But that budget was spread over an astounding 225 phone models. Yes, they were in various families, and each family shared a large part of the R&D for that family. Still each phone had different hardware, cases, and software. Apple has just a very few models.
putting software on more phones results in very little incremental costs. I get this. I was a manufacturer.
a while ago, Tim was asked about making cheaper phones. He repeated what Steve said, which had nothing to do with the concept of “junk”. It was, he said whether Apple could contribute something unique to that price level. If they thought they could, they would. If not, they wouldn’t enter the category.
that’s all well and good when sales for the industry are growing robustly, as they were for years after the iPhone came out. But now, industry sales are not growing, in fact, they’re down. When that happens, you have to rethink your strategy. Why does Apple have to have something unique in that category? Why not just produce a very good phone for the money, with Apple’s brand?
it may be getting to the point where nobody’s new phone, at any price, is all that much ahead of anyone else’s phone at that price.
and Apple’s problem now is that their highest growth area; greater China, has Chinese manufacturers that are competing much better than a few years ago. In addition, WeChat and Alibaba’s apps are being used for everything over there, making both Android and iOS almost irrelevant. That hurts Apple’s competitiveness. The Chinese government likes that because they can easily track everything that goes through those two apps. Chinese people don’t care because, according to a number of video reports from China I’ve seen, people’s attitude there is that if you keep your nose clean, it doesn’t matter. Here, People’s attitude is just the opposite, they’re worried that if they do something illegal the government might find out. What a difference.
these problems have forced Apple to turn to India. They really weren’t that interested until the China turn occurred. But India is far poorer than China. Apple can’t use the same marketing and sales policies there. And India is requiring them to bend over backwards in order to have their own stores, and to sell certain models. So Apple is spending billions on doing that. What are they going to sell? That’s what we need the answer to, because it’s not most of what Apple sells now.
from what you’re saying, Apple should pull out of most of the world because they can’t afford most of Apple’s hardware and services. I haven’t seen you come up with an answer, just a denial of the only answer Apple has.
Again, no, sorry. That's not what I said. Again, I was am responding to the claim that Apple can/should make a cheap but new product. The trouble with that approach is that, because of their increased per unit costs from software and ecosystem --- compared to competition -- They aren't competitive that way.
So, instead, they adopted the approach of leveraging their past development and manufacturing infrastructure by selling older, but still viable products. That obviously works.
melgross said: ... Are you saying that Apple is incapable of designing, and making a new $350 phone, because I doubt that. It’s a matter of will, not ability.
... Those of you who want to stick to the outdated notion that Apple MUST only compete on the high end should be seeing what problems that’s causing.
They did with the original iPhone SE. They did it with the iPad (2018) and now the mini (2019). They have done it in the past for various desktops and laptops. They have never been cheap, or competed with the lowest end of a market, but they were competitive and not just high-end.
I'm pretty sure when Steve was talking about 'not making junk' he wasn't saying he wanted the products only to be affordable for the wealthy. He was saying pretty much what he said... don't make junk. There is a difference between junk and creating a quality product for different market positions. Sure, depending on the product, you might not ever be able to go under some $ amount, but I really doubt $350 is it for a phone.
Nobody is talking about them making junk. A $350 phone isn’t junk. An $80 phone may be junk, when you’re talking about a smartphone. When we talk about these countries, we’re talking about people who can’t often even spend $350 on a phone. If Apple expects to do well there they have to sell what people can buy. That’s pretty simple, and nobody saying otherwise gets it. We have to stop being so stuck up about this. Apple, I’m sure, is looking into this. But if they’re so worried about their image, then they’ll never succeed there.
A $350 phone without iOS and Apple's ecosystem is junk. Apple could put out a quality $350 phone and then charge you hundred or two or three for the software and ecosystem needed to make it great.
George, that makes no sense. A phone without software is an incomplete device. So you’re still talking about a $550 phone. I’m not sure if you were serious with this or something else.
apple can make a $350 phone. The selling price of the SE proves it. It doesn’t need the latest SoC. It doesn’t need the most expensive LCD. It doesn’t need the most storage. It can use a polycarbonate case. Apple has already done that, and it proved more popular than they expected.
Yes, it is incomplete -- and to make it complete you have to spend (say) $550. I not only agree with that, but it was my point! That is: You are not considering the cost TO APPLE of their software and ecosystem because they bury it in the price of the "device". But the device is a combination of hardware, software and ecosystem -- each of which is non-trivial.
And yes, they did sell the SE for $350 -- but only by leveraging already existing technology and manufacturing processes. That means it looked new but was old -- or became old because it was never updated. Apple is using the same technique with the 2018 Gen6 iPad.
No. YOURE saying it would cost that much. Frankly, that’s just your numbers, and they mean nothing. You need to look at reality, not what you believe is reality, which this isn’t. Are you really saying that all that time Apple was selling the SE for $350–$400, they were losing $200 per phone? Because if you are, then we can all have a good laugh at that.
I don't think I said that. I pointed out that developing and maintaining APple's software and ecosystem cost money. The numbers were a hypothetical example that you are now trying to distort.
But, while I don't see Apple taking your approach with iPhones or iPads, (new and cheap), it could have benefit in their Mac line since those are pretty much just off-the-shelf hardware anyway and Apple could stick in almost anything they wanted in order to get volume up and bring fixed costs down.
I’m not distorting anything. You said the software should add $100 to $300 to the price of the phone. I took a middle number from YOUR numbers. Then later you even said, yes that $350 phone should cost $550, because of the software. So you’re acknowledging what you said with those numbers, unless you’re going to change your posts, but they’re in my response, right above.
Now, you’re saying you didn’t mean what you said? Well, exactly what did you mean, because you made it very clear in two posts.
why, instead of arguing with what I’m saying, don’t you tell us your solution, because so far, all you’re doing is denying that there is a solution.
Can you spell H Y P O T H E T I C A L E X A M P L E ?
And, since you seem to either twist my words or ignore them, there is not much point in spelling out what I said yet again.
melgross said: I think they should do both. Why shut themselves out of markets? Look at all the problems they have selling in India. They had a phone they were selling for $350. Then they discontinued it. There’s no sense in that. Why make a push in a country that can’t afford the products without having a product that they can afford? And the gold models were popular there, and elsewhere, and now they are no more either.
Yeah, I don't know. It doesn't make much overall sense. Maybe they are just trying to raise the average selling price to make the Wall Street people happy.
They certainly could do both, and I think they would be better for it. I'd much rather see a true lower cost model than selling outdated tech at lower prices.
The iPad line is now kind of like that, so I'm not sure why they can't do the same with phones. The big thing for me, though, is decoupling the form-factor from the price. I don't want the size device I pick to determine the feature set (or limited features set) because some schmuck at Apple has decided small screens should be 'budget' devices. That's just a stupid notion they need to break free from.
There are ramifications there... Selling a cheap product also means one that doesn't have the quality or reserve power of a standard product. That would drag Apple down to be just another manufacturer of junk -- which would impact the reputation (how people think) of the core products. It's why car manufacturers have separate companies for high end vs lower end products. The name "Cadillac" still has meaning...
Conversely, by selling older products they are leveraging existing facilities and technology without sacrificing quality. That is: the development work and manufacturing facilities and training for the iPhone 8 are done and paid for and they can use them for free or very low cost -- while supplying a high quality product.
And actually, both the iPhone SE and the iPad Gen 6 did just that: Although they were marketed as brand new products, the technology and internals were older and they did or will continue to leverage them for years. So, they can still sell a high quality product at a low cost.
That’s just doesn’t make sense. I repeat, why make a major sales, and manufacturing push (required there to sell independently) in a poor, but very large country, if you have no products that more than a tiny part of the population can buy? Not everyone wants to but 4 years old products at a lower price. Are you saying that Apple is incapable of designing, and making a new $350 phone, because I doubt that. It’s a matter of will, not ability.
yes, if Apple was only selling in wealthy countries, that experience shows will but these products in good numbers, then it makes sense to not sell a lower priced product. But not when we’re talking about India, and other countries Apple is trying to have a major impact in since the China angle is becoming difficult, both politically, and competitively.
this is very simple, and well understood business sense. Those of you who want to stick to the outdated notion that Apple MUST only compete on the high end should be seeing what problems that’s causing.
I don't think that they can -- because of two things: 1) Expected quality of materials, design and manufacture. 2) The cost of the software and ecosystem that accompanies every phone -- but is too often ignored. Instead, we compare a knock-off to an iPhone. It's not the hardware that makes iPhones great. It's the software and ecosystem -- and they cost money.
Or, to put it more succinctly: Could Apple make a brand new, state of the art phone for $350? YES! But only if they installed an Android OS and omitted all of Apple's ecosystem.
It costs Apple very little to put iOS on a phone, or their software. All of which is being given away for free, and that costs very little to supply.
just remember that it’s Apple that’s trying very hard to break into these markets. What I’m reading here makes no sense once you consider that. It’s not as though we’re talking about Apple breaking into those markets with Apple not being interested. Then it would just be our discussion. But it’s not. It’s Apple. So the question is why they’re not successful now. The main reason is price. It’s pretty simple. So there has to be a way for them to break into that market in a big enough way.
if you don’t like the idea of a less expensive product line, what is it that you do suggest? And try to be realistic.
Yes, it costs very little to INSTALL iOS on a phone. with that I agree. But if you mean it costs very little to develop and maintain iOS I strongly disagree. It costs a lot. And, on a unit basis far more than either a Windows OS or Android because they go on so many more units. And, then you get to the cost of the ecosystem which is equally costly to Apple.
Because we think Apple gives them away, we tend to under estimate their cost and their value.
Then that’s missing the point. The more devices it’s distributed in the less it costs per device. I understand how this works from my own businesses. R&D costs, whether hardware of software related are fixed for the year. Distribute it to 300 million devices and it costs so much per device. Distribute it between 500 million devices and it costs considerably less per device. That works out for their most expensive devices to their least expensive ones. Usually, the most expensive devices are assigned more of those costs per device than the lower cost devices are.
and it’s strange, because you basically just destroyed your own argument.
LOL... No, I didn't destroy anything. In addition to pointing out how volume impacts the per unit costs of mostly fixed costs, I acnowledged the reality of the situation -- that the quantities you are alluding to do not exist in the Apple world like they do in the Android or Windows worlds. And, to get there, Apple would need to take on a very different marketing model -- one that is very foreign to them.
In the meantime, leveraging the already paid for fixed expenses of older devices has been working well for them to increase the volume you are speaking of.
They exist for Apple, just as they do for anyone else. When you get to the level of selling over 200 million phones a year, with just a few models, you spread costs much more easily. I remember that when Nokia still ruled the roost, they had the highest R&D budget. But that budget was spread over an astounding 225 phone models. Yes, they were in various families, and each family shared a large part of the R&D for that family. Still each phone had different hardware, cases, and software. Apple has just a very few models.
putting software on more phones results in very little incremental costs. I get this. I was a manufacturer.
a while ago, Tim was asked about making cheaper phones. He repeated what Steve said, which had nothing to do with the concept of “junk”. It was, he said whether Apple could contribute something unique to that price level. If they thought they could, they would. If not, they wouldn’t enter the category.
that’s all well and good when sales for the industry are growing robustly, as they were for years after the iPhone came out. But now, industry sales are not growing, in fact, they’re down. When that happens, you have to rethink your strategy. Why does Apple have to have something unique in that category? Why not just produce a very good phone for the money, with Apple’s brand?
it may be getting to the point where nobody’s new phone, at any price, is all that much ahead of anyone else’s phone at that price.
and Apple’s problem now is that their highest growth area; greater China, has Chinese manufacturers that are competing much better than a few years ago. In addition, WeChat and Alibaba’s apps are being used for everything over there, making both Android and iOS almost irrelevant. That hurts Apple’s competitiveness. The Chinese government likes that because they can easily track everything that goes through those two apps. Chinese people don’t care because, according to a number of video reports from China I’ve seen, people’s attitude there is that if you keep your nose clean, it doesn’t matter. Here, People’s attitude is just the opposite, they’re worried that if they do something illegal the government might find out. What a difference.
these problems have forced Apple to turn to India. They really weren’t that interested until the China turn occurred. But India is far poorer than China. Apple can’t use the same marketing and sales policies there. And India is requiring them to bend over backwards in order to have their own stores, and to sell certain models. So Apple is spending billions on doing that. What are they going to sell? That’s what we need the answer to, because it’s not most of what Apple sells now.
from what you’re saying, Apple should pull out of most of the world because they can’t afford most of Apple’s hardware and services. I haven’t seen you come up with an answer, just a denial of the only answer Apple has.
Again, no, sorry. That's not what I said. Again, I was am responding to the claim that Apple can/should make a cheap but new product. The trouble with that approach is that, because of their increased per unit costs from software and ecosystem --- compared to competition -- They aren't competitive that way.
So, instead, they adopted the approach of leveraging their past development and manufacturing infrastructure by selling older, but still viable products. That obviously works.
Your saying that doesn’t make it true. Apple needs a less expensive line that’s less expensive from the get go, that supports the newest standards. Once phones become more than a couple of years old, they can’t do that, and that limits the distribution, and appeal. Just because people can’t afford the best and newest, doesn’t mean they want four and five year old products either. Apple can’t recycle the same thing over and over, making tiny changes, if any.
they advertise that they support the phone for a minimum of four years, actually five, more recently. But if they have a phone with a four year old chip, or modem, or whatever, they can’t do that.
they need to have a lower priced line from the beginning. Then they can keep a model for two years. After that, they need to clean house and totally upgrade it.
melgross said: ... Are you saying that Apple is incapable of designing, and making a new $350 phone, because I doubt that. It’s a matter of will, not ability.
... Those of you who want to stick to the outdated notion that Apple MUST only compete on the high end should be seeing what problems that’s causing.
They did with the original iPhone SE. They did it with the iPad (2018) and now the mini (2019). They have done it in the past for various desktops and laptops. They have never been cheap, or competed with the lowest end of a market, but they were competitive and not just high-end.
I'm pretty sure when Steve was talking about 'not making junk' he wasn't saying he wanted the products only to be affordable for the wealthy. He was saying pretty much what he said... don't make junk. There is a difference between junk and creating a quality product for different market positions. Sure, depending on the product, you might not ever be able to go under some $ amount, but I really doubt $350 is it for a phone.
Nobody is talking about them making junk. A $350 phone isn’t junk. An $80 phone may be junk, when you’re talking about a smartphone. When we talk about these countries, we’re talking about people who can’t often even spend $350 on a phone. If Apple expects to do well there they have to sell what people can buy. That’s pretty simple, and nobody saying otherwise gets it. We have to stop being so stuck up about this. Apple, I’m sure, is looking into this. But if they’re so worried about their image, then they’ll never succeed there.
A $350 phone without iOS and Apple's ecosystem is junk. Apple could put out a quality $350 phone and then charge you hundred or two or three for the software and ecosystem needed to make it great.
George, that makes no sense. A phone without software is an incomplete device. So you’re still talking about a $550 phone. I’m not sure if you were serious with this or something else.
apple can make a $350 phone. The selling price of the SE proves it. It doesn’t need the latest SoC. It doesn’t need the most expensive LCD. It doesn’t need the most storage. It can use a polycarbonate case. Apple has already done that, and it proved more popular than they expected.
Yes, it is incomplete -- and to make it complete you have to spend (say) $550. I not only agree with that, but it was my point! That is: You are not considering the cost TO APPLE of their software and ecosystem because they bury it in the price of the "device". But the device is a combination of hardware, software and ecosystem -- each of which is non-trivial.
And yes, they did sell the SE for $350 -- but only by leveraging already existing technology and manufacturing processes. That means it looked new but was old -- or became old because it was never updated. Apple is using the same technique with the 2018 Gen6 iPad.
No. YOURE saying it would cost that much. Frankly, that’s just your numbers, and they mean nothing. You need to look at reality, not what you believe is reality, which this isn’t. Are you really saying that all that time Apple was selling the SE for $350–$400, they were losing $200 per phone? Because if you are, then we can all have a good laugh at that.
I don't think I said that. I pointed out that developing and maintaining APple's software and ecosystem cost money. The numbers were a hypothetical example that you are now trying to distort.
But, while I don't see Apple taking your approach with iPhones or iPads, (new and cheap), it could have benefit in their Mac line since those are pretty much just off-the-shelf hardware anyway and Apple could stick in almost anything they wanted in order to get volume up and bring fixed costs down.
I’m not distorting anything. You said the software should add $100 to $300 to the price of the phone. I took a middle number from YOUR numbers. Then later you even said, yes that $350 phone should cost $550, because of the software. So you’re acknowledging what you said with those numbers, unless you’re going to change your posts, but they’re in my response, right above.
Now, you’re saying you didn’t mean what you said? Well, exactly what did you mean, because you made it very clear in two posts.
why, instead of arguing with what I’m saying, don’t you tell us your solution, because so far, all you’re doing is denying that there is a solution.
Can you spell H Y P O T H E T I C A L E X A M P L E ?
And, since you seem to either twist my words or ignore them, there is not much point in spelling out what I said yet again.
A hypothetical example is an example of what you think. Otherwise, why say it? Besides, you only called it hypothetical two posts later. I’m not ignoring your words when I’m referring to them directly, while you’re denying that you really mean what you said. Please don’t try to step things back that way. You said what you did. Either stick with it, and stop saying i’m distorting your very definite words, or back away from them and state that you don’t really think it’s possible.
and again, you’re trying to confuse the issue by not giving us your plan as to how Apple can solve this sales problem. Why don’t you concentrate on that instead?
melgross said: ... Are you saying that Apple is incapable of designing, and making a new $350 phone, because I doubt that. It’s a matter of will, not ability.
... Those of you who want to stick to the outdated notion that Apple MUST only compete on the high end should be seeing what problems that’s causing.
They did with the original iPhone SE. They did it with the iPad (2018) and now the mini (2019). They have done it in the past for various desktops and laptops. They have never been cheap, or competed with the lowest end of a market, but they were competitive and not just high-end.
I'm pretty sure when Steve was talking about 'not making junk' he wasn't saying he wanted the products only to be affordable for the wealthy. He was saying pretty much what he said... don't make junk. There is a difference between junk and creating a quality product for different market positions. Sure, depending on the product, you might not ever be able to go under some $ amount, but I really doubt $350 is it for a phone.
Nobody is talking about them making junk. A $350 phone isn’t junk. An $80 phone may be junk, when you’re talking about a smartphone. When we talk about these countries, we’re talking about people who can’t often even spend $350 on a phone. If Apple expects to do well there they have to sell what people can buy. That’s pretty simple, and nobody saying otherwise gets it. We have to stop being so stuck up about this. Apple, I’m sure, is looking into this. But if they’re so worried about their image, then they’ll never succeed there.
A $350 phone without iOS and Apple's ecosystem is junk. Apple could put out a quality $350 phone and then charge you hundred or two or three for the software and ecosystem needed to make it great.
George, that makes no sense. A phone without software is an incomplete device. So you’re still talking about a $550 phone. I’m not sure if you were serious with this or something else.
apple can make a $350 phone. The selling price of the SE proves it. It doesn’t need the latest SoC. It doesn’t need the most expensive LCD. It doesn’t need the most storage. It can use a polycarbonate case. Apple has already done that, and it proved more popular than they expected.
Yes, it is incomplete -- and to make it complete you have to spend (say) $550. I not only agree with that, but it was my point! That is: You are not considering the cost TO APPLE of their software and ecosystem because they bury it in the price of the "device". But the device is a combination of hardware, software and ecosystem -- each of which is non-trivial.
And yes, they did sell the SE for $350 -- but only by leveraging already existing technology and manufacturing processes. That means it looked new but was old -- or became old because it was never updated. Apple is using the same technique with the 2018 Gen6 iPad.
No. YOURE saying it would cost that much. Frankly, that’s just your numbers, and they mean nothing. You need to look at reality, not what you believe is reality, which this isn’t. Are you really saying that all that time Apple was selling the SE for $350–$400, they were losing $200 per phone? Because if you are, then we can all have a good laugh at that.
I don't think I said that. I pointed out that developing and maintaining APple's software and ecosystem cost money. The numbers were a hypothetical example that you are now trying to distort.
But, while I don't see Apple taking your approach with iPhones or iPads, (new and cheap), it could have benefit in their Mac line since those are pretty much just off-the-shelf hardware anyway and Apple could stick in almost anything they wanted in order to get volume up and bring fixed costs down.
I’m not distorting anything. You said the software should add $100 to $300 to the price of the phone. I took a middle number from YOUR numbers. Then later you even said, yes that $350 phone should cost $550, because of the software. So you’re acknowledging what you said with those numbers, unless you’re going to change your posts, but they’re in my response, right above.
Now, you’re saying you didn’t mean what you said? Well, exactly what did you mean, because you made it very clear in two posts.
why, instead of arguing with what I’m saying, don’t you tell us your solution, because so far, all you’re doing is denying that there is a solution.
Can you spell H Y P O T H E T I C A L E X A M P L E ?
And, since you seem to either twist my words or ignore them, there is not much point in spelling out what I said yet again.
A hypothetical example is an example of what you think. Otherwise, why say it? Besides, you only called it hypothetical two posts later. I’m not ignoring your words when I’m referring to them directly, while you’re denying that you really mean what you said. Please don’t try to step things back that way. You said what you did. Either stick with it, and stop saying i’m distorting your very definite words, or back away from them and state that you don’t really think it’s possible.
and again, you’re trying to confuse the issue by not giving us your plan as to how Apple can solve this sales problem. Why don’t you concentrate on that instead?
Ok, you win. I said whatever you say I said. And, I meant whatever you say I meant.
GeorgeBMac said: I would say leveraging the cost advantage of older designs provides the most effective avenue. ... And, since the newer processors are so powerful, having a generation or 2 back does not overly impact the experience of most users browsing the web or Facebook.
Yes, I suppose, though farther out it will. Maybe by that time, they've already had that 'magical' experience? But, I'm more concerned about UX than Apple optimizing their profits. I think Apple is now more concerned about optimizing profits.
GeorgeBMac said: Again, I was am responding to the claim that Apple can/should make a cheap but new product. The trouble with that approach is that, because of their increased per unit costs from software and ecosystem --- compared to competition -- They aren't competitive that way.
So, instead, they adopted the approach of leveraging their past development and manufacturing infrastructure by selling older, but still viable products. That obviously works.
But, they put the same software and apps on the past developed products, too. Maybe I'm misunderstand the debate here. I'm talking about taking an older design and adding a few updated components vs selling a product that is actually old vs designing a whole new product.
IMO, selling the old design with updated components is best for everyone. Making a totally new product maximizes the R&D cost. Selling an old product minimizes UX. The hybrid creates a new, very usable product with maximum UX for minimum R&D. All three use the same software and apps they'd have to put an additional copy of on if they sell another unit.
melgross said: ... Are you saying that Apple is incapable of designing, and making a new $350 phone, because I doubt that. It’s a matter of will, not ability.
... Those of you who want to stick to the outdated notion that Apple MUST only compete on the high end should be seeing what problems that’s causing.
They did with the original iPhone SE. They did it with the iPad (2018) and now the mini (2019). They have done it in the past for various desktops and laptops. They have never been cheap, or competed with the lowest end of a market, but they were competitive and not just high-end.
I'm pretty sure when Steve was talking about 'not making junk' he wasn't saying he wanted the products only to be affordable for the wealthy. He was saying pretty much what he said... don't make junk. There is a difference between junk and creating a quality product for different market positions. Sure, depending on the product, you might not ever be able to go under some $ amount, but I really doubt $350 is it for a phone.
Nobody is talking about them making junk. A $350 phone isn’t junk. An $80 phone may be junk, when you’re talking about a smartphone. When we talk about these countries, we’re talking about people who can’t often even spend $350 on a phone. If Apple expects to do well there they have to sell what people can buy. That’s pretty simple, and nobody saying otherwise gets it. We have to stop being so stuck up about this. Apple, I’m sure, is looking into this. But if they’re so worried about their image, then they’ll never succeed there.
A $350 phone without iOS and Apple's ecosystem is junk. Apple could put out a quality $350 phone and then charge you hundred or two or three for the software and ecosystem needed to make it great.
George, that makes no sense. A phone without software is an incomplete device. So you’re still talking about a $550 phone. I’m not sure if you were serious with this or something else.
apple can make a $350 phone. The selling price of the SE proves it. It doesn’t need the latest SoC. It doesn’t need the most expensive LCD. It doesn’t need the most storage. It can use a polycarbonate case. Apple has already done that, and it proved more popular than they expected.
Yes, it is incomplete -- and to make it complete you have to spend (say) $550. I not only agree with that, but it was my point! That is: You are not considering the cost TO APPLE of their software and ecosystem because they bury it in the price of the "device". But the device is a combination of hardware, software and ecosystem -- each of which is non-trivial.
And yes, they did sell the SE for $350 -- but only by leveraging already existing technology and manufacturing processes. That means it looked new but was old -- or became old because it was never updated. Apple is using the same technique with the 2018 Gen6 iPad.
No. YOURE saying it would cost that much. Frankly, that’s just your numbers, and they mean nothing. You need to look at reality, not what you believe is reality, which this isn’t. Are you really saying that all that time Apple was selling the SE for $350–$400, they were losing $200 per phone? Because if you are, then we can all have a good laugh at that.
I don't think I said that. I pointed out that developing and maintaining APple's software and ecosystem cost money. The numbers were a hypothetical example that you are now trying to distort.
But, while I don't see Apple taking your approach with iPhones or iPads, (new and cheap), it could have benefit in their Mac line since those are pretty much just off-the-shelf hardware anyway and Apple could stick in almost anything they wanted in order to get volume up and bring fixed costs down.
I’m not distorting anything. You said the software should add $100 to $300 to the price of the phone. I took a middle number from YOUR numbers. Then later you even said, yes that $350 phone should cost $550, because of the software. So you’re acknowledging what you said with those numbers, unless you’re going to change your posts, but they’re in my response, right above.
Now, you’re saying you didn’t mean what you said? Well, exactly what did you mean, because you made it very clear in two posts.
why, instead of arguing with what I’m saying, don’t you tell us your solution, because so far, all you’re doing is denying that there is a solution.
Can you spell H Y P O T H E T I C A L E X A M P L E ?
And, since you seem to either twist my words or ignore them, there is not much point in spelling out what I said yet again.
A hypothetical example is an example of what you think. Otherwise, why say it? Besides, you only called it hypothetical two posts later. I’m not ignoring your words when I’m referring to them directly, while you’re denying that you really mean what you said. Please don’t try to step things back that way. You said what you did. Either stick with it, and stop saying i’m distorting your very definite words, or back away from them and state that you don’t really think it’s possible.
and again, you’re trying to confuse the issue by not giving us your plan as to how Apple can solve this sales problem. Why don’t you concentrate on that instead?
Ok, you win. I said whatever you say I said. And, I meant whatever you say I meant.
Ok, great. So you didn’t mean what you said. No problem.
Comments
But, while I don't see Apple taking your approach with iPhones or iPads, (new and cheap), it could have benefit in their Mac line since those are pretty much just off-the-shelf hardware anyway and Apple could stick in almost anything they wanted in order to get volume up and bring fixed costs down.
But, what's wrong with doing that more? That's exactly what we're arguing... take an existing design, put newer stuff in it, leverage that existing tech and manufacturing. Apple seems to be the one who thinks they have to come up with new 'revolutionary' designs each iteration. I'm quite happy with my SE and 2018 Gen6 iPad.
Yes, but once done, the cost to duplicate it on more devices (for which they make money) is effectively zero.
But, I see what you mean with the 'NEW' comment. I wasn't so much talking about a completely new design. For example, they could use the 5c design and just put a modern chip in it, maybe update a couple of other components, etc. Though, they'd have to run the numbers. Maybe designing ground-up something completely aimed at that market would make sense, many not. I'm just saying that I don't think they would need to.
Yes, but at the cost of UX. Apple is damaging their brand, IMO, for short-term gain.
An older, lower-feature, design with a new chip is a great user experience (except for feature lack). An old model compromises the user experience (slower), and impacts the product longevity.
But, the question is: how to get there (assuming that they want to)
I would say leveraging the cost advantage of older designs provides the most effective avenue. While the external design doesn't change the cost much, the cost of manufacturing the internals such as the chips do... I think the new Mini is a good example. It is likely as cheap as Apple can go -- but still more than the larger Gen6 9.7" iPad.
putting software on more phones results in very little incremental costs. I get this. I was a manufacturer.
a while ago, Tim was asked about making cheaper phones. He repeated what Steve said, which had nothing to do with the concept of “junk”. It was, he said whether Apple could contribute something unique to that price level. If they thought they could, they would. If not, they wouldn’t enter the category.
that’s all well and good when sales for the industry are growing robustly, as they were for years after the iPhone came out. But now, industry sales are not growing, in fact, they’re down. When that happens, you have to rethink your strategy. Why does Apple have to have something unique in that category? Why not just produce a very good phone for the money, with Apple’s brand?
it may be getting to the point where nobody’s new phone, at any price, is all that much ahead of anyone else’s phone at that price.
and Apple’s problem now is that their highest growth area; greater China, has Chinese manufacturers that are competing much better than a few years ago. In addition, WeChat and Alibaba’s apps are being used for everything over there, making both Android and iOS almost irrelevant. That hurts Apple’s competitiveness. The Chinese government likes that because they can easily track everything that goes through those two apps. Chinese people don’t care because, according to a number of video reports from China I’ve seen, people’s attitude there is that if you keep your nose clean, it doesn’t matter. Here, People’s attitude is just the opposite, they’re worried that if they do something illegal the government might find out. What a difference.
these problems have forced Apple to turn to India. They really weren’t that interested until the China turn occurred. But India is far poorer than China. Apple can’t use the same marketing and sales policies there. And India is requiring them to bend over backwards in order to have their own stores, and to sell certain models. So Apple is spending billions on doing that. What are they going to sell? That’s what we need the answer to, because it’s not most of what Apple sells now.
from what you’re saying, Apple should pull out of most of the world because they can’t afford most of Apple’s hardware and services. I haven’t seen you come up with an answer, just a denial of the only answer Apple has.
Now, you’re saying you didn’t mean what you said? Well, exactly what did you mean, because you made it very clear in two posts.
why, instead of arguing with what I’m saying, don’t you tell us your solution, because so far, all you’re doing is denying that there is a solution.
Again, I was am responding to the claim that Apple can/should make a cheap but new product. The trouble with that approach is that, because of their increased per unit costs from software and ecosystem --- compared to competition -- They aren't competitive that way.
So, instead, they adopted the approach of leveraging their past development and manufacturing infrastructure by selling older, but still viable products. That obviously works.
And, since you seem to either twist my words or ignore them, there is not much point in spelling out what I said yet again.
they advertise that they support the phone for a minimum of four years, actually five, more recently. But if they have a phone with a four year old chip, or modem, or whatever, they can’t do that.
they need to have a lower priced line from the beginning. Then they can keep a model for two years. After that, they need to clean house and totally upgrade it.
and again, you’re trying to confuse the issue by not giving us your plan as to how Apple can solve this sales problem. Why don’t you concentrate on that instead?
But, they put the same software and apps on the past developed products, too. Maybe I'm misunderstand the debate here. I'm talking about taking an older design and adding a few updated components vs selling a product that is actually old vs designing a whole new product.
IMO, selling the old design with updated components is best for everyone. Making a totally new product maximizes the R&D cost. Selling an old product minimizes UX. The hybrid creates a new, very usable product with maximum UX for minimum R&D. All three use the same software and apps they'd have to put an additional copy of on if they sell another unit.