Nice piece on how reading the supply chain can be misleading and how some analysts still do it despite the misleading conclusions.
For his next exposé, DED will scrutinize rumor web sites that slavishly publicize these analyst reports and how some of them even vouch for the accuracy of their favorite analyst, Ming-Chi Kuo.
The 5C isn't the flagship and you can't compare percentages that way with any real meaning with out the total number.
How do you figure?
The 4s wasn't the flagship model compared to last years 5. Yet I can compare last years percentages to this years. We have total numbers:
4s - 24% of 6 million
5c - 27% of 9 million
Apple still made a sizable investment in the 5c, that likely did not yield them any more income than they would have received had they simply discounted last years 5 as they had done in previous years.
Does the 5c cost less to make? Perhaps. But does that recoup the massive expenditure to redesign, engineer, test and market it? As I look at it, it appears as though they are losing money over having done nothing.
Now could you argue the 5c promotion drew people into the stores who ended up buying more 5s models than they otherwise would have sold? Perhaps. But I'm not yet convinced the 5c wasn't a mistake no matter how well the brand is selling overall. The will tell.
Yes. The 27% of Apple's sales of iPhone is huge considering it's essentially an iPhone 5. With the price difference, I didn't expect the 5c to be the highest demand model. And it's possible that the profit margin on the 5c is higher (in percent of unit price) if indeed it uses mostly iPhone 5 parts (which at this point in time are cheaper than the 5s parts). Seems like the 5c is highly successful. I don't know what Apple's expectations were, but I don't see where they would be disappointed at all.
When you redesign an old model to make it new, then advertise the crap out of it while basically ignoring the flagship model... well, you can bet that Apple is banking on the 5c to perform really really well. Disappointed? I doubt it. It is selling in the millions. Wanting it to do better? I'd say yes, a lot better.
Oh, by the way, that 27% figure that you use... that's US only and with a high margin of error rate. We still haven't seen any figures from anywhere else. It could be as low as 15% or as high as 40%... we just don't know.
Quote: Apple's plan to "broaden its appeal with a cheaper version of the iPhone [...] appears to be faltering after a few weeks."
I wasn't aware that was Apple's plan. It was the plan that media pundits were suggesting that Apple adopt, but that's not the same thing. And given how overpriced the iPhone 5c is for what customers get, that's clearly not what Apple's executives intended with the model.
Rather than the 'c' standing for 'cheap,' it stands for 'color.' And they clearly hoped the Apple magic would persuade millions of people that last year's hardware in a ho-hum color case that looks like dozens of other phones was brilliant and innovative. We're now waiting to seem if that's true.
Keep in mind that the iPhone 5s is about twice as powerful and comes in a much more attractive case. If you compute out the cost over the term of the contract, the difference between the two is only about a dime to a quarter a day. Those who get the 5s will get that added cost back when they sell. Those who get the 5c will be lucky if they can sell theirs at anything other that fire sale prices.
Apple could have done something bold with the 5c, creating a smartphone for the many people who don't have an excess of disposable income. But it didn't and apparently never even tried.
The 4s wasn't the flagship model compared to last years 5. Yet I can compare last years percentages to this years. We have total numbers:
4s - 24% of 6 million
5c - 27% of 9 million
Apple still made a sizable investment in the 5c, that likely did not yield them any more income than they would have received had they simply discounted last years 5 as they had done in previous years.
Does the 5c cost less to make? Perhaps. But does that recoup the massive expenditure to redesign, engineer, test and market it? As I look at it, it appears as though they are losing money over having done nothing.
Now could you argue the 5c promotion drew people into the stores who ended up buying more 5s models than they otherwise would have sold? Perhaps. But I'm not yet convinced the 5c wasn't a mistake no matter how well the brand is selling overall. The will tell.
Mac
As mentioned above.
Bandying about that 27% of 9 million figure might not be a good idea. It's a US figure only. So, unless Apple sold 9 million units in the US then... well, I'm sure you get it.
Trouble is... none of us really knows anything and I doubt if Apple will ever let us in on the secret. If we call out the analysts then we have to admit that our guesses aren't any better.
I've pointed out that Cook warned against making predictions based on limited supply chain rumors, but the analysts continue with spreading their false information.
IMO, these analysts are just like carnival fortune tellers, only they're not as accurate or as entertaining.
WSJ, NYT are becoming nothing more than inaccurate rumor sites! Their revision on this issue is too little, too late. My guess is they're trying to manipulate the stock market. Someone should look into this and write an article. It doesn't have to be factual, just negative.
But how do you equate this with the success of the 5c. If they had simply followed historical patterns and offered the last years 5, might it have done just as well? I think it would have based on how well the 4 did to the 4S. I believe the iPhone overall has consistently done better than the previous year, as I said above. So I still don't see the 5c being justified.
They wouldve sold a ton of the 5- sure- probably even more. You could easily argue the minor differences (to most people- not us techies) between the 5 and 5s would have had a decent amount of cannabilization of the 5s and hurt their bottom line. Maybe in looking at their previous sales when the 4S was the flagship, and the 4 was the mid-tier- they saw way too many of the 4 sold vs the 4s because people thought "the only difference is siri". And they have no corrected the "exact look" problem that they had before.
The truth is- we don't know exactly everything. But what we do know is that it has sold substantially more than the 4s the previous year- as has the 5s vs the 5. So while we can argue they could have sold x% more of XYZ iphone- that's an argument that can never be answered because we'll never know. But when we look at the numbers sold across the board- it's a massive win in both the "mid-tier" and "top-tier" for Apple- and that's a great thing.
It always seems so odd why people would go out of their way to say that a particular company's product isn't selling well. There must dozens of tech companies who have products that aren't selling all that well. Take H-P or ASUS. Both of those companies have been struggling for a long time with poor product sales but you don't hear daily reports about any of their products not selling well. One just has to think when these reports about Apple having poor sales that it's some agenda-driven reason. Why should it be so important to report on Apple product sales daily? It just doesn't make any practical sense. Isn't anyone concerned with how many Kindle Fire HDXs are being sold? I constantly hear about the HDX as being stiff competition to the iPad Mini, but I never hear any numbers to back that up. I'm only saying that why should the news media always single Apple out of the pack.
Sometimes their bs affects a stock price in a positive way. It's just entertainment, like a supermarket checkout line fan mag. The press is a business. It hawks what sells.
Of greater significance is how stupid "investors" (including many a highly paid fund manager) really are who don't understand this. They are the ones "affect[ing] the stock price in a negative way".
The press doesn't buy and sell. It's audience does. And that is why the markets are such crap shoots and always will be.
It didn't sound like the WSJ was back pedaling to me. It was still a very negative article with an obvious anti Apple slant.
I said this in the other thread but it's rather apparent to me that the 5C is selling below expectations.
Retailers have been overstocked with the device since launch which means Apple probably anticipated higher demand for the 5C.
Add in the fact that Apple has launched a massive global advertising campaign for the 5C and it can barely muster a 27% share of sales is also very telling.
...a 27% share of sales is also very telling.
In what way? The 5c has been on sale in the U.S. for less than a month and other countries for even less time. How is that enough time to prove a product is a success or failure. The average consumer doesn't just rush out a buy a product as soon as it's released. Give it a few months and then you'll have a much better picture. This reasoning about how a product can be a success or failure based on initial or early sales isn't sound. You say retailers have been overstocked with 5c units. What do you consider overstock? That the product doesn't stay sold out? You don't have a clue how many 5c units are in any any retail store at any moment. Only the store would know that information and you can't go by just one or two stores. You don't know what Apple's sales expectations of the 5c were. Only Apple could tell you that with any certainty. If you're talking about analysts' expectations, forget them because they're just a bunch of agenda-driven, hedge fund butt-kissing sock-puppets.
The 4s wasn't the flagship model compared to last years 5. Yet I can compare last years percentages to this years. We have total numbers:
4s - 24% of 6 million
5c - 27% of 9 million
Apple still made a sizable investment in the 5c, that likely did not yield them any more income than they would have received had they simply discounted last years 5 as they had done in previous years.
Does the 5c cost less to make? Perhaps. But does that recoup the massive expenditure to redesign, engineer, test and market it? As I look at it, it appears as though they are losing money over having done nothing.
Now could you argue the 5c promotion drew people into the stores who ended up buying more 5s models than they otherwise would have sold? Perhaps. But I'm not yet convinced the 5c wasn't a mistake no matter how well the brand is selling overall. The will tell.
You seem to be claiming that because the percentages remain largely unchanged between the 4s and 5c that Apple failed.
But look at the figures;
24% of 6m = 1.44m
27% of 9m = 2.43m
Therefore its clear that the 5c sold 68% more than the 4s did.
your argument that apple would have increased sales by 3% regardless also doesn't stack up, a 3% increase on sales of 1.44m is 1.48m, so taking into account natural market growth, still means that the 5c increase sales by 66%.
It always seems so odd why people would go out of their way to say that a particular company's product isn't selling well. There must dozens of tech companies who have products that aren't selling all that well. Take H-P or ASUS. Both of those companies have been struggling for a long time with poor product sales but you don't hear daily reports about any of their products not selling well. One just has to think when these reports about Apple having poor sales that it's some agenda-driven reason. Why should it be so important to report on Apple product sales daily? It just doesn't make any practical sense. Isn't anyone concerned with how many Kindle Fire HDXs are being sold? I constantly hear about the HDX as being stiff competition to the iPad Mini, but I never hear any numbers to back that up. I'm only saying that why should the news media always single Apple out of the pack.
My theory is either it's deliberate manipulation or they are die hard Microcrap/PC users that hate Apple has shat (UK past tense) all over MS. Sometimes they might be both I guess.
You seem to be claiming that because the percentages remain largely unchanged between the 4s and 5c that Apple failed.
But look at the figures;
24% of 6m = 1.44m
27% of 9m = 2.43m
Therefore its clear that the 5c sold 68% more than the 4s did.
your argument that apple would have increased sales by 3% regardless also doesn't stack up, a 3% increase on sales of 1.44m is 1.48m, so taking into account natural market growth, still means that the 5c increase sales by 66%.
No no no!
That 27% figure is for the US only.
For all you know they shipped 3 million units to China with only a 15% sell rate.
The 23% and 27% figures are not even valid for a real discussion unless you know the numbers available and sold in the US for the 4s last year and the same for the 5c this year.
[iow - the yoy growth in the US, according to the figures used form that study, was a statistical dead heat.]
You seem to be claiming that because the percentages remain largely unchanged between the 4s and 5c that Apple failed.
But look at the figures;
24% of 6m = 1.44m
27% of 9m = 2.43m
Therefore its clear that the 5c sold 68% more than the 4s did.
your argument that apple would have increased sales by 3% regardless also doesn't stack up, a 3% increase on sales of 1.44m is 1.48m, so taking into account natural market growth, still means that the 5c increase sales by 66%.
For all you know they shipped 3 million units to China with only a 15% sell rate.
The 23% and 27% figures are not even valid for a real discussion unless you know the numbers available and sold in the US for the 4s last year and the same for the 5c this year.
[iow - the yoy growth in the US, according to the figures used form that study, was a statistical dead heat.]
If China got 3 million units and only a 15% rate (both estimations which are likely skewed to the point you're making)- thats 450,000 more units still.
24% of 6m = 1.44m
27% of 6m = 1.62m + .45m = 2.07m or a 44% increase year over year.
If China got 3 million units and only a 15% rate (both estimations which are likely skewed to the point you're making)- thats 450,000 more units still.
24% of 6m = 1.44m
27% of 6m = 1.62m + .45m = 2.07m or a 44% increase year over year.
Even with your skewed numbers its a home run
So no 5c units were sold in Europe or the rest of the world?
The 4s wasn't sold in China or the rest of the world?
The margin of error rate between 23% and 27%
You've forgotten a few things.
That was a US study. Get over it.
We don't know availabilities of either phone in the US.
A study of yoy growth in China and Europe might tell us more. Not sure.
Is the 23% vs. 27% even a valid barometer (I like that word) for yoy growth?
I don't know. You don't know.
... but you can keep banging away at it if you wish.
Boy, you find it hard to admit that you don't really know.
You give me absolutely no figures to support your assumptions. No yoy in Europe, no yoy in China, no yoy anywhere except the States... and then you say that I am spinning the story.
I tell you what I know. A questionable study came out that showed yoy growth in the US in the mid tier Apple phones was 23% vs. 27%, 4s / 5c... a statistical dead heat. I also know that it might not even be a valid barometer of anything.
See if you can say otherwise.
[... and I'm sure if I was too far off the mark there would be a number of qualified posters ripping me to shreds]
Comments
For his next exposé, DED will scrutinize rumor web sites that slavishly publicize these analyst reports and how some of them even vouch for the accuracy of their favorite analyst, Ming-Chi Kuo.
The 4s wasn't the flagship model compared to last years 5. Yet I can compare last years percentages to this years. We have total numbers:
4s - 24% of 6 million
5c - 27% of 9 million
Apple still made a sizable investment in the 5c, that likely did not yield them any more income than they would have received had they simply discounted last years 5 as they had done in previous years.
Does the 5c cost less to make? Perhaps. But does that recoup the massive expenditure to redesign, engineer, test and market it? As I look at it, it appears as though they are losing money over having done nothing.
Now could you argue the 5c promotion drew people into the stores who ended up buying more 5s models than they otherwise would have sold? Perhaps. But I'm not yet convinced the 5c wasn't a mistake no matter how well the brand is selling overall. The will tell.
Yes. The 27% of Apple's sales of iPhone is huge considering it's essentially an iPhone 5. With the price difference, I didn't expect the 5c to be the highest demand model. And it's possible that the profit margin on the 5c is higher (in percent of unit price) if indeed it uses mostly iPhone 5 parts (which at this point in time are cheaper than the 5s parts). Seems like the 5c is highly successful. I don't know what Apple's expectations were, but I don't see where they would be disappointed at all.
When you redesign an old model to make it new, then advertise the crap out of it while basically ignoring the flagship model... well, you can bet that Apple is banking on the 5c to perform really really well. Disappointed? I doubt it. It is selling in the millions. Wanting it to do better? I'd say yes, a lot better.
Oh, by the way, that 27% figure that you use... that's US only and with a high margin of error rate. We still haven't seen any figures from anywhere else. It could be as low as 15% or as high as 40%... we just don't know.
I wasn't aware that was Apple's plan. It was the plan that media pundits were suggesting that Apple adopt, but that's not the same thing. And given how overpriced the iPhone 5c is for what customers get, that's clearly not what Apple's executives intended with the model.
Rather than the 'c' standing for 'cheap,' it stands for 'color.' And they clearly hoped the Apple magic would persuade millions of people that last year's hardware in a ho-hum color case that looks like dozens of other phones was brilliant and innovative. We're now waiting to seem if that's true.
Keep in mind that the iPhone 5s is about twice as powerful and comes in a much more attractive case. If you compute out the cost over the term of the contract, the difference between the two is only about a dime to a quarter a day. Those who get the 5s will get that added cost back when they sell. Those who get the 5c will be lucky if they can sell theirs at anything other that fire sale prices.
Apple could have done something bold with the 5c, creating a smartphone for the many people who don't have an excess of disposable income. But it didn't and apparently never even tried.
How do you figure?
The 4s wasn't the flagship model compared to last years 5. Yet I can compare last years percentages to this years. We have total numbers:
4s - 24% of 6 million
5c - 27% of 9 million
Apple still made a sizable investment in the 5c, that likely did not yield them any more income than they would have received had they simply discounted last years 5 as they had done in previous years.
Does the 5c cost less to make? Perhaps. But does that recoup the massive expenditure to redesign, engineer, test and market it? As I look at it, it appears as though they are losing money over having done nothing.
Now could you argue the 5c promotion drew people into the stores who ended up buying more 5s models than they otherwise would have sold? Perhaps. But I'm not yet convinced the 5c wasn't a mistake no matter how well the brand is selling overall. The will tell.
Mac
As mentioned above.
Bandying about that 27% of 9 million figure might not be a good idea. It's a US figure only. So, unless Apple sold 9 million units in the US then... well, I'm sure you get it.
Trouble is... none of us really knows anything and I doubt if Apple will ever let us in on the secret. If we call out the analysts then we have to admit that our guesses aren't any better.
IMO, these analysts are just like carnival fortune tellers, only they're not as accurate or as entertaining.
WSJ, NYT are becoming nothing more than inaccurate rumor sites! Their revision on this issue is too little, too late. My guess is they're trying to manipulate the stock market. Someone should look into this and write an article. It doesn't have to be factual, just negative.
But how do you equate this with the success of the 5c. If they had simply followed historical patterns and offered the last years 5, might it have done just as well? I think it would have based on how well the 4 did to the 4S. I believe the iPhone overall has consistently done better than the previous year, as I said above. So I still don't see the 5c being justified.
They wouldve sold a ton of the 5- sure- probably even more. You could easily argue the minor differences (to most people- not us techies) between the 5 and 5s would have had a decent amount of cannabilization of the 5s and hurt their bottom line. Maybe in looking at their previous sales when the 4S was the flagship, and the 4 was the mid-tier- they saw way too many of the 4 sold vs the 4s because people thought "the only difference is siri". And they have no corrected the "exact look" problem that they had before.
The truth is- we don't know exactly everything. But what we do know is that it has sold substantially more than the 4s the previous year- as has the 5s vs the 5. So while we can argue they could have sold x% more of XYZ iphone- that's an argument that can never be answered because we'll never know. But when we look at the numbers sold across the board- it's a massive win in both the "mid-tier" and "top-tier" for Apple- and that's a great thing.
Sometimes their bs affects a stock price in a positive way. It's just entertainment, like a supermarket checkout line fan mag. The press is a business. It hawks what sells.
Of greater significance is how stupid "investors" (including many a highly paid fund manager) really are who don't understand this. They are the ones "affect[ing] the stock price in a negative way".
The press doesn't buy and sell. It's audience does. And that is why the markets are such crap shoots and always will be.
It didn't sound like the WSJ was back pedaling to me. It was still a very negative article with an obvious anti Apple slant.
I said this in the other thread but it's rather apparent to me that the 5C is selling below expectations.
Retailers have been overstocked with the device since launch which means Apple probably anticipated higher demand for the 5C.
Add in the fact that Apple has launched a massive global advertising campaign for the 5C and it can barely muster a 27% share of sales is also very telling.
...a 27% share of sales is also very telling.
In what way? The 5c has been on sale in the U.S. for less than a month and other countries for even less time. How is that enough time to prove a product is a success or failure. The average consumer doesn't just rush out a buy a product as soon as it's released. Give it a few months and then you'll have a much better picture. This reasoning about how a product can be a success or failure based on initial or early sales isn't sound. You say retailers have been overstocked with 5c units. What do you consider overstock? That the product doesn't stay sold out? You don't have a clue how many 5c units are in any any retail store at any moment. Only the store would know that information and you can't go by just one or two stores. You don't know what Apple's sales expectations of the 5c were. Only Apple could tell you that with any certainty. If you're talking about analysts' expectations, forget them because they're just a bunch of agenda-driven, hedge fund butt-kissing sock-puppets.
How do you figure?
The 4s wasn't the flagship model compared to last years 5. Yet I can compare last years percentages to this years. We have total numbers:
4s - 24% of 6 million
5c - 27% of 9 million
Apple still made a sizable investment in the 5c, that likely did not yield them any more income than they would have received had they simply discounted last years 5 as they had done in previous years.
Does the 5c cost less to make? Perhaps. But does that recoup the massive expenditure to redesign, engineer, test and market it? As I look at it, it appears as though they are losing money over having done nothing.
Now could you argue the 5c promotion drew people into the stores who ended up buying more 5s models than they otherwise would have sold? Perhaps. But I'm not yet convinced the 5c wasn't a mistake no matter how well the brand is selling overall. The will tell.
You seem to be claiming that because the percentages remain largely unchanged between the 4s and 5c that Apple failed.
But look at the figures;
24% of 6m = 1.44m
27% of 9m = 2.43m
Therefore its clear that the 5c sold 68% more than the 4s did.
your argument that apple would have increased sales by 3% regardless also doesn't stack up, a 3% increase on sales of 1.44m is 1.48m, so taking into account natural market growth, still means that the 5c increase sales by 66%.
Half way to my goal.
My theory is either it's deliberate manipulation or they are die hard Microcrap/PC users that hate Apple has shat (UK past tense) all over MS. Sometimes they might be both I guess.
You seem to be claiming that because the percentages remain largely unchanged between the 4s and 5c that Apple failed.
But look at the figures;
24% of 6m = 1.44m
27% of 9m = 2.43m
Therefore its clear that the 5c sold 68% more than the 4s did.
your argument that apple would have increased sales by 3% regardless also doesn't stack up, a 3% increase on sales of 1.44m is 1.48m, so taking into account natural market growth, still means that the 5c increase sales by 66%.
No no no!
That 27% figure is for the US only.
For all you know they shipped 3 million units to China with only a 15% sell rate.
The 23% and 27% figures are not even valid for a real discussion unless you know the numbers available and sold in the US for the 4s last year and the same for the 5c this year.
[iow - the yoy growth in the US, according to the figures used form that study, was a statistical dead heat.]
Beat me to it.
No no no!
That 27% figure is for the US only.
For all you know they shipped 3 million units to China with only a 15% sell rate.
The 23% and 27% figures are not even valid for a real discussion unless you know the numbers available and sold in the US for the 4s last year and the same for the 5c this year.
[iow - the yoy growth in the US, according to the figures used form that study, was a statistical dead heat.]
If China got 3 million units and only a 15% rate (both estimations which are likely skewed to the point you're making)- thats 450,000 more units still.
24% of 6m = 1.44m
27% of 6m = 1.62m + .45m = 2.07m or a 44% increase year over year.
Even with your skewed numbers its a home run
If China got 3 million units and only a 15% rate (both estimations which are likely skewed to the point you're making)- thats 450,000 more units still.
24% of 6m = 1.44m
27% of 6m = 1.62m + .45m = 2.07m or a 44% increase year over year.
Even with your skewed numbers its a home run
So no 5c units were sold in Europe or the rest of the world?
The 4s wasn't sold in China or the rest of the world?
The margin of error rate between 23% and 27%
You've forgotten a few things.
That was a US study. Get over it.
We don't know availabilities of either phone in the US.
A study of yoy growth in China and Europe might tell us more. Not sure.
Is the 23% vs. 27% even a valid barometer (I like that word) for yoy growth?
I don't know. You don't know.
... but you can keep banging away at it if you wish.
So no 5c units were sold in Europe or the rest of the world?
The 4s wasn't sold in China or the rest of the world?
The margin of error rate between 23% and 27%
You've forgotten a few things.
Boy, you find it hard to admit that you don't really know.
You give me absolutely no figures to support your assumptions. No yoy in Europe, no yoy in China, no yoy anywhere except the States... and then you say that I am spinning the story.
I tell you what I know. A questionable study came out that showed yoy growth in the US in the mid tier Apple phones was 23% vs. 27%, 4s / 5c... a statistical dead heat. I also know that it might not even be a valid barometer of anything.
See if you can say otherwise.
[... and I'm sure if I was too far off the mark there would be a number of qualified posters ripping me to shreds]