People shopping for a smartphone in July, for instance, might consider holding off if a significant iPhone update is predicted for September. Hints of a modest update can prompt people to wait even longer, or simply buy an Android phone.
I seriously doubt the people would “buy an Android phone” because they didn’t want to wait for Apple. That’s strictly a nerd sort of mentality.
Except that surveys and polls have shown that people do exactly that. Or a very recent example of the reverse behavior: during the Note 7 debacle, lots of people who wanted to buy the Galaxy Note 7 bought iPhones instead, and lots of THOSE are either buying the Samsung Galaxy 8+ or are waiting on the Galaxy Note 8. Two things that you are overlooking:
1) Carriers make it VERY EASY for their longtime customers to switch/upgrade devices. The reason is that it prevents the competition (carriers I mean) from using the lure of a new device to get people to switch.
2) 90% of the population doesn't care about the fanboy platform wars. Most people switch back and forth between the platforms. The vast majority of iPhone owners have owned an Android phone in the past and vice versa. The media only reports the number of people who switch from Android to iPhone each quarter ... while ignoring that an equal number of people switch from iPhone to Android, and that a huge number of people own BOTH iPhones and Androids with one being their daily driver and the other a spare, or one being for professional use and the other for personal use. That is why I always take the "I once owned a Samsung and LG phone and it was so horrible ... the stutter, the lag, the crashing apps ... it was a total nightmare but when I switched to an iPhone it was like a new lease on life!" comments on Apple blogs with a grain of salt (because anonymous unverifiable Internet comments that can be made with no repercussions are exactly that). It does not come close to matching actual market statistics and patterns. If it did you WOULD NOT see AT&T, Verizon, Sprint and T-Mobile treat iPhones and major Android phones nearly equally. (This was not always the case by the way ... I remember when Android phones were a distinct stepchildren to the iPhone and Nokia phones to carriers, and also when carriers were quite antagonistic to Google.)
So as the average consumer hasn't been a loyal Apple fan who has only bought Apple products for the past 20 years but is instead someone who owned an Android phone 3 years ago before buying an iPhone 2 years ago - or vice versa - getting a Samsung Galaxy to use for 6 months or so until they can switch to an iPhone at the cost of only like $50 - $100 bucks (or even for free) from their carrier is not exactly a nausea-inducing thought, but rather is a routine business transaction for your very friends and neighbors.
Please provide links for your statements. I don't believe them. Otherwise please stop trolling. Your time on an apple rumors sight is not being well used.
It's also worth noting that if you deduct the difference in channel reduction from the year-ago quarter and this one, Apple actually sold slightly MORE iPhones this quarter than a year ago. The 50.8M figure only represents shipments to resellers; the total sell-through, Cook said, was quite a bit higher.
Yes, but that "slightly MORE" includes sales of the $399 iPhone SE, a device the likes of which that right up until it was released Apple and many ardent Apple fans insisted should never and would never exist because it was IMPOSSIBLE to make a smartphone for less than the cost of a premium iPhone without sacrificing basic quality and design, eliminating vital profit margin, and subjecting Apple to the same destructive race to the bottom that destroyed the Windows PC industry (except that it didn't happen as Dell, HP, Lenovo, Acer, Toshiba and pretty much everyone but IBM, Sony and Packard Bell are still making PCs, not to mention a lot of new companies that are now making Windows PCs and 2-in-1s like Razer, Huawei, Xiaomi and RCA).
So yes, while total sales of iPhones increased, sales of premium iPhone models declined. In other words, remove the several million iPhone SE sales - some of which were bought by iPhone loyalists who wanted a bargain or preferred a smaller device but a great many would have otherwise bought a midrange name brand Android device - and the drop would have been much more noticeable and much harder to spin away. And this is not my naysaying conjecture - I am not an Apple hater but someone who has bought a MacBook Pro, multiple iPads, an Apple TV and an Apple Watch just in the past couple of years - but something that was predicted in advance by Apple sites such as https://9to5mac.com/2016/11/04/iphone-7-sales/ !!!
And by the way ... that article also predicted the squeeze that Apple was going to put on the likes of Imagination, Nokia, Qualcomm etc. over licensing and components costs as a result too. Selling fewer premium high margin iPhones means getting as much out of each iPhone that you do sell as possible.
Easy solution for Apple is the spread product releases out so people have official news to talk about. Currently all product news is between WWDC to thanksgiving and nothing but suggestion of things to come otherwise.
Suggestions for early in the year event. IPadPro and padOS 4inch Phone (noting iPhone sales declines but user base is growing faster than sales so people are holding on to older phones) iMac and iMacPro IPod Touch upgrades. Here is where the jump to plusSize screen could be a winner for Apple.
I remember Microsoft’s tactic. After a startup announced or released a new product Microsoft would immediately announce that they were working on the same thing and that it would be better. Consumers then often waited for the Microsoft product instead of buying the startup’s product. Microsoft would then buy out the now failing startup and release the original product as its own. Evil personified but it worked for a long time, along with the equally evil “embrace and extend” policy that suffocated innovative software.
Yep. And that was another old technique that Microsoft stole from IBM. Back in the 60s during the CDC 6600’s Five Year Reign :
When [Seymour] Cray’s CDC 6600 streaked ahead in 1964, IBM chief Tom Watson, Jr. was furious. IBM quickly pre-announced faster models of its System/360 computers, drying up CDC’s sales.
But IBM never actually shipped its “6600 killer,” and CDC president William Norris responded with an antitrust suit.
I think what Cook means is that the new model is being over hyped with unreasonable feature expectation and the is a limit to what they can put in a new model that list of features is probably way too much for a brand new phone and should it even miss one feature that is basically confirmed to be coming, well the media is going to tear Apple a new one thus setting what might have been a very successful product to faile, if no one new what was coming any new feature even if it was two would sell well IMHO
I think what Cook means is that the new model is being over hyped with unreasonable feature expectation
That might influence the buying decisions of folks that read the tech blogs, but what percentage of Apple's customer base fall into the category? I suspect the significant majority don't know what the rumored feature set of the iPhone 8 is going to be. But I'd also wager that anyone who pays even marginal attention to anything knows that new iPhones come on about the same time every year.
This is probably more a problem of Apple's release schedule being predictable than what technology is actually rumored to be in the release.
Smartphones in general have largely exhausted most of the conceptually "easy" use cases that were simply brought over and repackaged from various legacy platforms, e.g., music, phone, email, games, driving directions, ebooks, photography, pda functions, messaging, etc. Not discounting the implementation complexity, amazing design, or dramatic improvements in miniaturization and power efficiency - but the basic concepts about what features and capabilities needed to be captured in a universally connected mobile handheld device were well known and waiting for smart people to bring to real products. Once Apple figured out the basic formula, established the archetype, and settled on a form factor that exists intact to the current models, everyone else's challenges were reduced dramatically. Plug and chug. So we now have the first wave of innovation in cash cow mode and smartphones are ubiquitous for the masses. What's next is anyone's guess, but it's not going to be as "easy" as repackaging well known concepts into a new form factor. The next wave of innovation will be exponentially more challenging and interesting. I have a high level of confidence that Apple will lead the way and other technology firms will follow in Apple's wake, but there's probably not a lot of breakthrough or breathtaking innovation left in the current generation of smartphones. But they'll still be relevant for at least a couple more decades.
By how much do leaks hurt sales? Are we talking 1M or 2M unit losses? Surely, most consumers around the world aren't constantly reading tech articles about coming products. Since there are people always claiming that iPhone upgrades aren't worth very much due to lack of innovation, one would think there weren't a lot of people desperately waiting to upgrade.
Again, we're talking about quarterly sales when investors should consider looking at the entire yearly sales. Between peak iPhone sales, Apple should be selling their other products to fill in those low revenue quarters. That's Apple's fault. If Apple had a cloud business it might have been able to fill in these low-revenue quarters.
That's the difference between Apple and those FANG stocks. Those FANG stocks have revenue coming in every quarter and they're also managing to increase revenue every quarter whereas Apple has weak quarters because they're only relying on the iPhone. There doesn't seem to be any other major bright spots for Apple except the iPhone. With all that reserve cash, Apple should easily be able to find some business that can boost revenue every quarter. Apple simply isn't aggressive enough or hungry enough as a company when they certainly have the means to be.
What are you smoking? Apple IS selling other product lines and services -- the revenue from their ipad line could be its own company. iPhone dwarfs all else, including their excellent revenue elsewhere.
It's also worth noting that if you deduct the difference in channel reduction from the year-ago quarter and this one, Apple actually sold slightly MORE iPhones this quarter than a year ago. The 50.8M figure only represents shipments to resellers; the total sell-through, Cook said, was quite a bit higher.
Yes, but that "slightly MORE" includes sales of the $399 iPhone SE, a device the likes of which that right up until it was released Apple and many ardent Apple fans insisted should never and would never exist because it was IMPOSSIBLE to make a smartphone for less than the cost of a premium iPhone without sacrificing basic quality and design, eliminating vital profit margin, and subjecting Apple to the same destructive race to the bottom
No, what people said was apple wouldn't do a cheap phone for the same reasons they wouldn't do a cheap netbook. They didn't.
...hmmm nobody seems concerned about: "3D facial recognition and/or iris scanning"...? ...and is this volunteered to the cloud under patriot act law of governance...? If speculation ensues in facts, for whom is this an upgrade...?
What I've always appreciated most from Apple is stunning industrial design and WYSIWYG GUI on a robust UNIX OS, and integrated lossless digital audio...
People shopping for a smartphone in July, for instance, might consider holding off if a significant iPhone update is predicted for September. Hints of a modest update can prompt people to wait even longer, or simply buy an Android phone.
I seriously doubt the people would “buy an Android phone” because they didn’t want to wait for Apple. That’s strictly a nerd sort of mentality.
Except that surveys and polls have shown that people do exactly that. Or a very recent example of the reverse behavior: during the Note 7 debacle, lots of people who wanted to buy the Galaxy Note 7 bought iPhones instead, and lots of THOSE are either buying the Samsung Galaxy 8+ or are waiting on the Galaxy Note 8. Two things that you are overlooking:
1) Carriers make it VERY EASY for their longtime customers to switch/upgrade devices. The reason is that it prevents the competition (carriers I mean) from using the lure of a new device to get people to switch.
2) 90% of the population doesn't care about the fanboy platform wars. Most people switch back and forth between the platforms. The vast majority of iPhone owners have owned an Android phone in the past and vice versa. The media only reports the number of people who switch from Android to iPhone each quarter ... while ignoring that an equal number of people switch from iPhone to Android, and that a huge number of people own BOTH iPhones and Androids with one being their daily driver and the other a spare, or one being for professional use and the other for personal use. That is why I always take the "I once owned a Samsung and LG phone and it was so horrible ... the stutter, the lag, the crashing apps ... it was a total nightmare but when I switched to an iPhone it was like a new lease on life!" comments on Apple blogs with a grain of salt (because anonymous unverifiable Internet comments that can be made with no repercussions are exactly that). It does not come close to matching actual market statistics and patterns. If it did you WOULD NOT see AT&T, Verizon, Sprint and T-Mobile treat iPhones and major Android phones nearly equally. (This was not always the case by the way ... I remember when Android phones were a distinct stepchildren to the iPhone and Nokia phones to carriers, and also when carriers were quite antagonistic to Google.)
So as the average consumer hasn't been a loyal Apple fan who has only bought Apple products for the past 20 years but is instead someone who owned an Android phone 3 years ago before buying an iPhone 2 years ago - or vice versa - getting a Samsung Galaxy to use for 6 months or so until they can switch to an iPhone at the cost of only like $50 - $100 bucks (or even for free) from their carrier is not exactly a nausea-inducing thought, but rather is a routine business transaction for your very friends and neighbors.
I stopped taking you seriously after you stated,
"...a very recent example of the reverse behavior: during the Note 7 debacle, lots of people who wanted to buy the Galaxy Note 7 bought iPhones instead,"
You're suggesting that switching to IPhone after the Note 7 debacle is equivalent behavior to switching away from the iPhone to Andriod because there's a significant new iPhone rumored but not yet available. That's very muddy thinking.
You then go on to state,
"...an equal number of people switch from iPhone to Android,"
and
"Most people switch back and forth between the platforms." These are statements that you cannot possibly defend with actual numbers. If an equal number of people switch away from iPhone to Andriod as switch to iPhone from Andriod, then that implies the entire increase in tje iPhone user base is due to people switching to iPhone from a feature phone or buying an iPhone as their first phone. But this is refuted by Tim Cook's own words, and you'll be aware that he has more information on the topic than you do, plus he is legally obligated to speak the truth. He doesn't refer to Andriod as a training ground for the iPhone for no reason.
The statement suggesting most people switch back and forth carries two implications. First, it excludes all those who have switched only once between platforms. I am in that camp, as I began on Andriod and switched to iPhone, and never switched again. That's not 'back and forth,' it's just forth. Second, the word 'most' implies that more than 50% of people are doing this activity. I'd say 'most' implies significantly more than 50%, otherwise, if the number were near the 50% range you'd have been more clear to say, 'a majority,' but you used the word, 'most.' The notion that most smartphone users in the Android and iPhone universe switch back and forth is incredible to the point of being absurd. Thus, your arguments and knowledge of these markets cannot be taken seriously.
But, you were at least honest enough to offer a hint to your readers in this statement,
"because anonymous unverifiable Internet comments that can be made with no repercussions are exactly that" Thanks for at least warning your readers regarding your own statements.
Of course people are holding off upgrading, my wife's 6S suffered from the battery problem and once fixed she sold it on and picked up a cheap 5S. She didn't want the 7 as she knew a new iPhone was coming out in September - she doesn't read any tech sites or see any apple leaks and I don't bore her with such info and yet even she knew an all-new major redesign was on the cards and she was going to wait for it. I think if Apple can maintain year on year sales despite the looming iPhone 8/X then sales are surely going to spike to all new highs when it finally hits.
People are holding off on buying the iterative update because they are waiting on the major redesign. Happens all the time - and not just with the iPhone or even just with Apple - so no news or shock here. It is only an issue for those who felt that iPhone sales were going to increase indefinitely. Everyone else - including folks internally at Apple - knew that the saturation point was going to happen some time. That was why 2 years ago Apple started making a concerted effort to get Android owners to switch - by playing up security and privacy fears and releasing the "move to iPhone" app - as well as focusing on overseas growth.
But peak iPhone - more accurately peak (premium) smartphone - has passed. It may be an exaggeration to say that smartphones are just another product - as they still make Apple the #1 company in history by far after all - but the gee whiz phenomenon factor is gone. People are used to them, which means that they no longer have to go out and have the latest one ... or even get the best one that they can afford (since cheaper smartphones are no longer the brutal devices that they once were ... and by the way now include the iPhone SE, another attempt by Apple to goose sales and draw international customers and Android switchers).
True. We are in the comfort zone for smart phones. We will not see the smartphone market expand wildly in the developed world and will (in fact are already seeing) more competition at the premium end where the pie is largely the same size.
Rumours will hurt sales today, that is clear but if people didn't hold off today they wouldn't be in the market tomorrow anyway. The upshot is that it's swings and roundabouts. TC is using the claim to partially justify the sales numbers.
The design of the iPhone 7 is tired and there is a group of users for whom design change in itself is reason to upgrade and lack of change is reason to hold back. As it's been a while since the last real change, I imagine the coming version of iPhone will have more potential buyers (provided the price is right). That means Apple might see a peak after release but the underlying market will be the same basic size.
And yet Samsug gets a pass even though "Sales from the mobile unit declined, with the business posting an operating profit of $1.8 billion (2.07 trillion won), down 47% from the $3.4 billion (3.89 trillion won) it netted a year ago".
Comments
Currently all product news is between WWDC to thanksgiving and nothing but suggestion of things to come otherwise.
Suggestions for early in the year event.
IPadPro and padOS
4inch Phone (noting iPhone sales declines but user base is growing faster than sales so people are holding on to older phones)
iMac and iMacPro
IPod Touch upgrades. Here is where the jump to plusSize screen could be a winner for Apple.
Back in the 60s during the CDC 6600’s Five Year Reign :
This is probably more a problem of Apple's release schedule being predictable than what technology is actually rumored to be in the release.
Apple's growing cash hoard surges to $256.8 billion
'Nuff said.
...and is this volunteered to the cloud under patriot act law of governance...?
If speculation ensues in facts, for whom is this an upgrade...?
What I've always appreciated most from Apple is stunning industrial design and WYSIWYG GUI on a robust UNIX OS,
and integrated lossless digital audio...
"...a very recent example of the reverse behavior: during the Note 7 debacle, lots of people who wanted to buy the Galaxy Note 7 bought iPhones instead,"
You're suggesting that switching to IPhone after the Note 7 debacle is equivalent behavior to switching away from the iPhone to Andriod because there's a significant new iPhone rumored but not yet available. That's very muddy thinking.
You then go on to state,
"...an equal number of people switch from iPhone to Android,"
and
"Most people switch back and forth between the platforms."
These are statements that you cannot possibly defend with actual numbers. If an equal number of people switch away from iPhone to Andriod as switch to iPhone from Andriod, then that implies the entire increase in tje iPhone user base is due to people switching to iPhone from a feature phone or buying an iPhone as their first phone. But this is refuted by Tim Cook's own words, and you'll be aware that he has more information on the topic than you do, plus he is legally obligated to speak the truth. He doesn't refer to Andriod as a training ground for the iPhone for no reason.
The statement suggesting most people switch back and forth carries two implications. First, it excludes all those who have switched only once between platforms. I am in that camp, as I began on Andriod and switched to iPhone, and never switched again. That's not 'back and forth,' it's just forth. Second, the word 'most' implies that more than 50% of people are doing this activity. I'd say 'most' implies significantly more than 50%, otherwise, if the number were near the 50% range you'd have been more clear to say, 'a majority,' but you used the word, 'most.' The notion that most smartphone users in the Android and iPhone universe switch back and forth is incredible to the point of being absurd. Thus, your arguments and knowledge of these markets cannot be taken seriously.
But, you were at least honest enough to offer a hint to your readers in this statement,
"because anonymous unverifiable Internet comments that can be made with no repercussions are exactly that"
Thanks for at least warning your readers regarding your own statements.
Rumours will hurt sales today, that is clear but if people didn't hold off today they wouldn't be in the market tomorrow anyway. The upshot is that it's swings and roundabouts. TC is using the claim to partially justify the sales numbers.
The design of the iPhone 7 is tired and there is a group of users for whom design change in itself is reason to upgrade and lack of change is reason to hold back. As it's been a while since the last real change, I imagine the coming version of iPhone will have more potential buyers (provided the price is right). That means Apple might see a peak after release but the underlying market will be the same basic size.
And yet Samsug gets a pass even though "Sales from the mobile unit declined, with the business posting an operating profit of $1.8 billion (2.07 trillion won), down 47% from the $3.4 billion (3.89 trillion won) it netted a year ago".
Source: http://www.androidcentral.com/samsung-posts-record-profits-q1-2017-even-phone-sales-decline