France Telecom CEO says iPhone sales threatened by lack of cheaper option

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Comments

  • Reply 21 of 67
    gazoobeegazoobee Posts: 3,754member

    Quote:

    Originally Posted by jdnc123 View Post


     


    The market will accept lower margins if the top line increases such that the overall notional gross margin dollar amount is larger.  The market doesn't want to sit around and watch margins bleed while Apple does nothing to address top line to offset the margin drop.  


     


    For those paying attention, the value of Apple (meaning enterprise value) is about where it was 2 years ago.  Any move up in stock since then has been offset by cash build, so the underlying business hasn't increased in value at all at this point (of course it had).  Probably one of only a handful of companies in the market where no value creation in 2 years.  Focus on making great products is great, but they need to do so in such a fashion that it increases the value of the company.



     


    This strikes me as just a load of business-speak baffle-gab.  


     


    Steve Balmer, is that you?  image

  • Reply 22 of 67
    gazoobeegazoobee Posts: 3,754member

    Quote:

    Originally Posted by SolipsismX View Post





    In comparison to the newer iPhone it is but it's still expensive. In the US the iPhone 4 from 2010 retails for $450 for 8GB. How much is that same phone in France?


     


    This seems to be also a good argument *against* a low cost iPhone in that they could probably get more marketshare and generate more revenue by simply halving the margin on last years' phone, dropping the price by a hundred or more when bought off-contract, and making it essentially free, on-contract. 

  • Reply 23 of 67
    solipsismxsolipsismx Posts: 19,566member
    gazoobee wrote: »
    This seems to be also a good argument *against* a low cost iPhone in that they could probably get more marketshare and generate more revenue by simply halving the margin on last years' phone, dropping the price by a hundred or more when bought off-contract, and making it essentially free, on-contract. 

    For markets that have such contracts I think that's a great way to go, but others — especially for China, India and upcoming African markets — that may not be the best move for maximizing profits long term.
  • Reply 24 of 67
    apple ][apple ][ Posts: 9,233member


    Here we go again, and this time it's French people whining about cheaper iPhones.


     


    Apple needs to resist the temptation to give in to the cheapskates who keep calling for cheaper Apple products. There is a limit as to how cheap Apple can go, and Apple is never going to win the cheap race. 


     


    Apple should be concentrating on making new, mind blowing products, and pricing them appropriately. And guess what, not everybody will be able to afford them, that's life. Go get a job or something.


     


    Is Apple about making amazing products that are the envy of the entire industry, or is Apple about providing cheap people with cheap products? I know which Apple that I prefer. In closing, screw cheap people, who are a hinder to the advancement of tech.

  • Reply 25 of 67
    mj webmj web Posts: 918member

    Quote:

    Originally Posted by mieswall View Post


    The guy is right. It is silly to be self-blinded because of your desires. I am very concerned about the lack of proactivity of Apple's board.


     


    A year ago, we were all thinking Apple would sell 60m, even 70m iphones per Q with the arrival of iphone5 (remember, "unstoppable demand"?) . Then, supply issues tried to convince us that it was not a matter of shrinking demand. That may or may not be true; but the real consequence is that the demand, perhaps even because of that lack of supply, end up shrinking. The very same Apple has validated the droid alternatives, leaving low-income markets uncovered, not properly giving the high incomers what they wanted and when they wanted (larger phone, IFC, etc).


     


    Now we are waiting forever some action of the management regarding China Mobile (years hearing this story), cheaper phone, larger phone, stock buyback, higher dividend, iTV (at least two years ago the "cracked" this), iRadio... and nothing at all happens except piling cash absurdly; instead we have lower margins, growth stalled, iphone supply issues, imac supply issues, map app problems, execs leaving the company, competitors providing equal or better products at lower prices, iPad mini cannibalizing his big brother, stock downgrades, options blatant manipulation, and the stock in free-fall, with Cook & Partners doing nothing...


     


    I give up on Apple.



    I don't give up on Apple but...


     


    Steve Jobs left Apple once in the 90s and the company shriveled to a rotten core. 


    Steve Jobs left Apple for good in 2012 (RIP) and the company is imploding under Tim Cook & Co in the same way.


    If the directors don't repair the trouble at the top, ASAP, Apple is destined to shrivel implode to its 1990 levels.


    The Apple apologist, cheerleaders, and fanbois on AI aren't doing Apple any favors blindly sitting by as Apple atrophies.


     


    I don't give up on Apple but have given up on the blind people on this forum.

  • Reply 26 of 67
    robin huberrobin huber Posts: 3,724member


    In related news, sales of gold said to be hurt by lack of a lower cost option. Tiffany said to be test marketing "gold lite" jewelry. 

  • Reply 27 of 67
    jungmarkjungmark Posts: 6,924member
    mj web wrote: »
    I don't give up on Apple but...

    Steve Jobs left Apple once in the 90s and the company shriveled to a rotten core. 
    Steve Jobs left Apple for good in 2012 (RIP) and the company is imploding under Tim Cook & Co in the same way.
    If the directors don't repair the trouble at the top, ASAP, Apple is destined to shrivel implode to its 1990 levels.
    The Apple apologist, cheerleaders, and fanbois on AI aren't doing Apple any favors blindly sitting by as Apple atrophies.

    I don't give up on Apple but have given up on the blind people on this forum.

    Know your history. Jobs left in the 80s and died in 2011. Apple had the most profitable year in recent corporate history. Apple failed in the dark ages because they weren't focused. What's the diff between a PM7200 and PM7500? They also weren't selling much and also not making any profit. Now they are practically selling everything the make and getting the lion's share of profit.
  • Reply 28 of 67
    sensisensi Posts: 346member
    Well if the French say it, it must be true!
    Care to elaborate? You sound like another pathetic bigot.
  • Reply 29 of 67
    sensisensi Posts: 346member
    danv2 wrote: »

    France is facing a huge recession. They are going broke, don't work, and their unions are stuffing their channels with jargon when they already work a six hour day. Poor governance is killing them, and they are trying to place blame everywhere but with themselves. This telecom leader is a prime example.

    I'd say France needs to look at the policies it has in place, and question whether or not it wants to stop inflicting self injury.
    You should check again the definition of recession because France sure isn't in any, France has less public debt than the US, France is the less unionized country among the OECD nations with 9% of the active population in any union (vs 12% for the US), etc. Try again, maybe with facts this time.
  • Reply 30 of 67
    v5vv5v Posts: 1,357member

    Quote:

    Originally Posted by paxman View Post


    [...] For Apple to create a feature limited iPhone beyond speed and capacity also strikes me as odd and not like Applesque thinking.



     


    iPod Shuffle, Nano, Touch. Good, better, best. Cheap, affordable, "Ouch."


     


    So there's at least some precedent for that approach in Apple's history.

  • Reply 31 of 67
    apple ][apple ][ Posts: 9,233member

    Quote:

    Originally Posted by Sensi View Post





    You should check again the definition of recession because France sure isn't in any, France has less public debt than the US, France is the less unionized country among the OECD nations with 9% of the active population in any union (vs 12% for the US), etc. Try again, maybe with facts this time.


    That's funny, this is from today's news:


     


     


    FAILING FRANCE


    The dismal French PMI boded ill for the euro zone's No.2 economy for the next quarter at least.


    The Markit services purchasing managers' index fell in March for the eighth month running to 41.3 from 43.7 in February, hitting its lowest level since February 2009.


    "The very weak support readings for the president (Francois Hollande) suggest it will be very difficult to go ahead with far-reaching structural reforms that are likely to lift productivity growth in the economy anytime soon, said Michels at Citi.


    http://www.reuters.com/article/2013/04/04/us-europe-economy-idUSBRE9330E620130404


    The socialist in charge of France is finding out that stealing money from people is not as easy as first planned. Many of the rich are leaving the country, after all, who wants to get taxed at 75%? image What a joke.image


     


    And, here's another one:image


     


    France ‘heading into triple-dip recession’


     


    http://www.euronews.com/2013/03/22/france-hrecessioneading-into-triple-dip-/


     


     


     



  • Reply 32 of 67
    theothergeofftheothergeoff Posts: 2,081member

    Quote:

    Originally Posted by mieswall View Post


    The guy is right. It is silly to be self-blinded because of your desires. I am very concerned about the lack of proactivity of Apple's board.


     


    A year ago, we were all thinking Apple would sell 60m, even 70m iphones per Q with the arrival of iphone5 (remember, "unstoppable demand"?) . Then, supply issues tried to convince us that it was not a matter of shrinking demand. That may or may not be true; but the real consequence is that the demand, perhaps even because of that lack of supply, end up shrinking. The very same Apple has validated the droid alternatives, leaving low-income markets uncovered, not properly giving the high incomers what they wanted and when they wanted (larger phone, IFC, etc).


     


    Now we are waiting forever some action of the management regarding China Mobile (years hearing this story), cheaper phone, larger phone, stock buyback, higher dividend, iTV (at least two years ago the "cracked" this), iRadio... and nothing at all happens except piling cash absurdly; instead we have lower margins, growth stalled, iphone supply issues, imac supply issues, map app problems, execs leaving the company, competitors providing equal or better products at lower prices, iPad mini cannibalizing his big brother, stock downgrades, options blatant manipulation, and the stock in free-fall, with Cook & Partners doing nothing...


     


    I give up on Apple.



    I'll buy your stock

  • Reply 33 of 67
    allenbfallenbf Posts: 993member


    Some of you are a little too quick (or maybe just blind) to write off the CEO's comments as "negotiation gimmicks" or with comments like "Good, let the French people save up" and other such nonsense. It's obvious that you are either just intentionally ignorant or have zero knowledge (maybe both) of how sales and to a larger degree, economics, work. Thankfully, Apple does.


     


    It's literally a zero sum game. Apple knows this. And Samsung & other Android phones are a decent SECOND choice option. In that market, with price being a factor (which is what the CEO is saying here) then every Android phone that is sold is one less iPhone that is sold. It's basic math. We can discuss VALUE all we want and I'm all for that, I am not interested in a second tier platform and build quality, which is why love my iPhone 5. But not everyone who's shopping for a smartphone looks at it in terms of value, but instead in terms of cost, and will it serve their needs. The answer is, Yes; it does. And yes, it's cheaper.


     


    Apple knows this, and they'll address it. As for myself, I believe they will build a less expensive iPhone to serve the market.

  • Reply 34 of 67
    theothergeofftheothergeoff Posts: 2,081member

    Quote:

    Originally Posted by v5v View Post


     


    iPod Shuffle, Nano, Touch. Good, better, best. Cheap, affordable, "Ouch."


     


    So there's at least some precedent for that approach in Apple's history.



    I think the precedent here is that Apple sells at many price points, but all provide the core service.


     


    What's the difference than a 4/4s/5   good/better/best?   All have retina, all can run all (mostly) iOS apps.   All have facetime.   All have gyros/accelerometers, all support 3.5(4)G, and WiFi.


     


    I think the precedent is covered.


     


    What France Telecom is complaining about is the fact that France Telecom is getting caught in the vise of providing more bandwidth for less price, and still can't attract the big iOS customers (who demand/require higher bulk data) to his carrier because his company doesn't subsidize the phone.   If more people bought the iPhone in France, he'd make more profit, so he wants Apple to make less profit....  yeah.... right.

  • Reply 35 of 67
    jungmarkjungmark Posts: 6,924member
    v5v wrote: »
    iPod Shuffle, Nano, Touch. Good, better, best. Cheap, affordable, "Ouch."

    So there's at least some precedent for that approach in Apple's history.

    The iPod is an MP3 player first. The iPhone is a smartphone first. How can you "dumb" it down and still have the same iOS experience?
  • Reply 36 of 67

    Quote:

    Originally Posted by MJ Web View Post


    I don't give up on Apple but...


     


    Steve Jobs left Apple once in the 90s and the company shriveled to a rotten core. 


    Steve Jobs left Apple for good in 2012 (RIP) and the company is imploding under Tim Cook & Co in the same way.


    If the directors don't repair the trouble at the top, ASAP, Apple is destined to shrivel implode to its 1990 levels.


    The Apple apologist, cheerleaders, and fanbois on AI aren't doing Apple any favors blindly sitting by as Apple atrophies.


     


    I don't give up on Apple but have given up on the blind people on this forum.



     


    Steve Jobs died October 5th 2011.  The stock price in the days before he died was around 370 a share.  Even with the pullback the stock is still 15% higher than it was before his death.  Oh and the last quarter of Apple before he died Apple had revenues of 27.28 Billion. The most recent quarter they had revenues of 54.51 Billion.  Their profit margins since Steve Jobs' death have been higher than any other quarter before Steve Job's death except the June 2011 quarter surpassing the profit margin of the quarter June 30 2012 by .4%.  So basically their stock is higher than it ever was under Jobs, their revenues are higher than they ever were under Jobs (with the most recent quarter having revenues double what they were the last quarter before Jobs' death) and their profit margins have exceeded all quarters but one before Jobs' death.  Atrophy my ass. I'd be willing to bet every CEO wishes their company to "implode" by having their revenues double in under 2 years of being on the job and leading the company to be more profitable than it has ever been in its entire history.

  • Reply 37 of 67
    v5vv5v Posts: 1,357member

    Quote:

    Originally Posted by jungmark View Post



    The iPod is an MP3 player first. The iPhone is a smartphone first. How can you "dumb" it down and still have the same iOS experience?


     


    So what are the fundamentals of a smartphone? Voice, text, web? Media player? Something else?


     


    Consider the iPod Touch the equivalent of the current iPhone. The Nano could be a model for a less expensive iPhone. Still a phone and media player, but without Apps.


     


    I'm not saying that's what they will or should do, I'm just saying that it's not at all "un-Apple" to offer varying capabilities and price points within a product line. The iPod line is an example of how they already do.

  • Reply 38 of 67
    sidstesidste Posts: 25member


    I had a cheaper iPhone.  It was called the iPhone 4.  I sold it for $275 on Amazon.  Maybe I should start buying them up and taking them to France.

  • Reply 39 of 67
    a2gsga2gsg Posts: 26member

    Quote:

    Originally Posted by SolipsismX View Post





    In comparison to the newer iPhone it is but it's still expensive. In the US the iPhone 4 from 2010 retails for $450 for 8GB. How much is that same phone in France?




    since last year, you can buy a no-contract 16GB iPhone 4S for $450 retail from http://www.virginmobileusa.com/shop/cell-phones/iphone-phones/ here in the US as well as a 8GB iPhone 4 for $350...


     


    they also have the cheapest/most affordable no-contract rate plans (for which you get an additional $5 off/discount per month) when AUTO-PAY is enabled: http://www.virginmobileusa.com/cell-phone-plans/

  • Reply 40 of 67
    jungmarkjungmark Posts: 6,924member
    v5v wrote: »
    So what are the fundamentals of a smartphone? Voice, text, web? Media player? Something else?

    Consider the iPod Touch the equivalent of the current iPhone. The Nano could be a model for a less expensive iPhone. Still a phone and media player, but without Apps.

    I'm not saying that's what they will or should do, I'm just saying that it's not at all "un-Apple" to offer varying capabilities and price points within a product line. The iPod line is an example of how they already do.

    Why would there be an iPhone without Apps? It wouldn't make any sense. The apps are part if the experience. That stripped down phone might a well be a dumb phone.
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