Apple is putting out products that aren’t that much better than the rest of the market, and raising their already high prices. When there are very good phones for less than $700, Apple isn’t going to sell many (compared to cheaper years past models) at $1,100. Apple wowed the world when the iPad came out at $499. Now the entry to the Pro model is $799.
Macs are the same story. Sacrificing upgradability over form factor, prices have increase dramatically with little innovation. Who cares how thin a desktop computer is when you can’t upgrade it.
Apple now nickles and dimes you for everything. They can’t afford to put the 3.5mm dongle in with a $1,250 iPhone? How about the crazy dongle prices when switching to USB C? Apple doesn’t need to make 1000% margin on those when it means breaking the people who are overspending for their products already.
Apple needs to go back to 1998 and review their lineup again. There was a time when Apple Sold one iPhone per year. Now they have a half dozen that don’t appear to be all that different. But keeping each on production costs money. Narrow the assortment and offer products people want (upgradable!) at fair prices.
Except there doesn’t seem to be evidence that many people are leaving iOS for cheaper Android devices (at least not outside of China). If anything people are just holding on to what they have longer. I agree though the company has an issue across the board with pricing. And raising prices to offset lengthening upgrade cycles is not the answer.
Apple has always played the game of being pricey, that if you don’t want to pay up, they don’t need you as a customer, etc.
That works very well in the early stages of a product cycle, when there is lot of scope for differentiation using innovation, lot of scope for new must have features, etc.
However, when the market starts approaching maturity, when older products and competitor products start hitting “good enough” levels, Apple is late to see the writing on the wall. They resort to hubris, and customer unfriendly techniques to increase Average Selling Price, and to increase margins.
At some point, even the most loyalist fans of Apple start noticing that there is little justification for buying the latest Apple product, paying a ridiculous price, and then having to deal with the compromises Apple forces on you.
These compromises could be in many ways. A Buggy Bluetooth Audio implementation, combined with removing the Headphone jack and replacing with Lightning. Pathetic battery life. Poor quality cables and rip off replacement cables. Soldered hardware that isn’t user replaceable. All of this is ignored when the going is good - but suddenly all these customer unfriendly ways hit them from all angles, the moment Apple starts skidding.
And the result is visible for all to see.
I do think Apple has a price issue but the rest is people taking this news and attributing it to whatever pet peeve they have about the company. Cook specifically said this change in guidance is all iPhone related.
This is just the sign that investment bankers have got used to Apples stellar performance. They are still expected to make a profit of billions just not as many. Greed of the bankers is the real story here.
There is also another issue that nobody really wants to talk about in fear of not being PC, but nobody but a small section of the potential customer base want to listen to a potty mouth SJW CEO going on about how their customers should live their lives and what values they should hold.
If Timmy wants to be an activist - fine - keep it at the local level where it might be relevant, but the moment he steps outside the US, his message is either irrelevant because many countries gained the rights he keeps fighting for even decades ago, or it flies right in the face or their religion, culture and belief systems. Incidentally these geographies falls under Apple's definition of emerging markets. So it is not only price and currency issues that discourage customers in these markets.
This I agree with wholeheartedly. Tim and his co-CEOs can say/do whatever they want from 5pm - 8am, but the rest of the time, their job is to manage an organization for their customers and shareholders.
Corporations have absolutely no business getting involved with setting social policy agendas. It’s a short step from there to fascism.
So Apple had supply constraints, maybe it was due to some suppliers cutting their own forecasts and leaking it to the media. Not sure how Apple could be driving demand and saying were constrained by supply only have suppliers say demand was down.
Things are not adding up here.
I do believe the tariff wars had more to do with this than anything else. I can tell you our Asian suppliers are working with us to reduce the tariff impact so they do not lose the business. Then you have China companies telling their employees to boycott Apple products and buy Chinese.
I don't agree with the end-of-the-world tone of some of the posts. That's just dramatizing for attention.
I do notice however, that I'm having a tougher time defending Apple's product prices. In discussions with friends I mostly share my outrage about them. I think twice about buying something and often don't do it, because I can't "justify it". That's a big change for a 30+ year loyal Apple-fan-boy.
From my perspective, it's about time Apple's hits a rough patch. It can only benefit us, it's customers. They've clearly gone too far. Innovation & expensive is ok. Greed is not. A correction is very much needed. If they are stubborn about it, the market will do the work for them.
It's like they are too concerned with themselves (as a company). Reminds me of good old Rome. Building palaces right up to the fall.
From 2011 through 2017, many so-called analysts who didn't understand Apple, said that Apple stopped innovating, and the other players in the market caught up. They said Apple could not innovate without Steve Jobs.
It turns out that you can innovate without Steve Jobs (look at WayTools, Telsa, and other companies). You just really have to want it. Referring to what Steve said, R&D isn't about writing a cheque. You have to think on behalf of your customers' best interests, all-round, including fairness and providing value.
When the original iPhone dropped in price the year after it was released, Apple issued a $100 refund for every single early buyer. Apple took a small hit on the bottom line to be loyal to their customers. And that's why the Apple brand name was so strong in 2012.
2018 rolls around and finally the so-called analysts are right. Apple now increments but charges category-defining prices. iPad Pro 12.9" (512GB LTE) went from CA$1606 (2017) to over CA$1900 (2018). The damn pencil went up by 50%!!! Same goes for iPhone, Mac mini, MacBook Air - just about everything Apple makes.
If it was $1000 or more, it went up by $200-$300. Overnight. If it was under $1000, it went up to nearly $1000. Base model Mac mini went from $499 to $799. And all they did was put back the quad core that the 2012 model had that they took out in 2014. And the audacity to shout on stage at the keynote, "more cores is faster." No shit?
Is it a mystery that people aren't buying?
Steve used to say that Apple's customers were smart. If you want to lead, you got to make things for the leaders. i.e. artists, musicians, directors, and other professionals who do amazing things with their systems and push the boundaries.
But instead Apple is fooling itself thinking it can chase easy money. They send demo units to "influencers" i.e. people with YouTube channels. They hope that Apple customers are truly sheeple who just buy what "influencers" show off.
Apple is failing because it is pandering to fools, hoping that "a fool and their money soon part." They forgot their customers are artists, creatives, directors, engineers, authors, teachers, scientists.
We can easily see Intel is polishing a turd when they are at 14nm+++ (i.e. didn't do 10, 10+, and certainly didn't do 7). Nobody is going to buy their crap. Everyone is pissed off at Intel, to the point they are booting up their own silicon teams.
Perhaps the only area that Apple is leading in right now - is the A-series silicon. They used to lead in development tools too, like Swift. But hey, they pissed off the people who made Swift so they went elsewhere.
Exactly. Add to this the fact that some of us (like yours truly) bought MacBook Pros this summer as soon as they were released only to have a silent graphics upgrade issued for them 3 months later at a nominal price, just in time to avoid mass returns under their “secret” 90 day customer service return policy. This was insult to loyal customers and unlike when the iPhone dropped in price, no check was issued and no upgrade is still yet offered for those who spent thousands and would prefer the upgraded graphics. Apple’s only goal was to milk first adopters during the back to school season before releasing the additional MBP upgrades later.
Brand loyalty and trust is earned over years, but can be lost in months and under Tim Cook’s Apple, they are starting to lose mine.
People complaining about prices still don’t get it. Apple has a majority base of buyers who are price insensitive. Whining about it will change nothing and it’s that core of support that makes Apple resilient in times when things get bad for everyone else.
Another big change was the way iPhones are purchased, from the monthly payment to your cell provider to a one time up-front. People don’t mind $15 a month, but a thousand at once means running up the credit card at 25%. Perhaps an acceptance corporation to deal with long term loans like the old GMAC used to do with GM cars?
If you’re using a credit card to borrow money at 25%, you should probably be working on paying down debt, not buying expensive new things.
From 2011 through 2017, many so-called analysts who didn't understand Apple, said that Apple stopped innovating, and the other players in the market caught up. They said Apple could not innovate without Steve Jobs.
It turns out that you can innovate without Steve Jobs (look at WayTools, Telsa, and other companies). You just really have to want it. Referring to what Steve said, R&D isn't about writing a cheque. You have to think on behalf of your customers' best interests, all-round, including fairness and providing value.
When the original iPhone dropped in price the year after it was released, Apple issued a $100 refund for every single early buyer. Apple took a small hit on the bottom line to be loyal to their customers. And that's why the Apple brand name was so strong in 2012.
2018 rolls around and finally the so-called analysts are right. Apple now increments but charges category-defining prices. iPad Pro 12.9" (512GB LTE) went from CA$1606 (2017) to over CA$1900 (2018). The damn pencil went up by 50%!!! Same goes for iPhone, Mac mini, MacBook Air - just about everything Apple makes.
If it was $1000 or more, it went up by $200-$300. Overnight. If it was under $1000, it went up to nearly $1000. Base model Mac mini went from $499 to $799. And all they did was put back the quad core that the 2012 model had that they took out in 2014. And the audacity to shout on stage at the keynote, "more cores is faster." No shit?
Is it a mystery that people aren't buying?
Steve used to say that Apple's customers were smart. If you want to lead, you got to make things for the leaders. i.e. artists, musicians, directors, and other professionals who do amazing things with their systems and push the boundaries.
But instead Apple is fooling itself thinking it can chase easy money. They send demo units to "influencers" i.e. people with YouTube channels. They hope that Apple customers are truly sheeple who just buy what "influencers" show off.
Apple is failing because it is pandering to fools, hoping that "a fool and their money soon part." They forgot their customers are artists, creatives, directors, engineers, authors, teachers, scientists.
We can easily see Intel is polishing a turd when they are at 14nm+++ (i.e. didn't do 10, 10+, and certainly didn't do 7). Nobody is going to buy their crap. Everyone is pissed off at Intel, to the point they are booting up their own silicon teams.
Perhaps the only area that Apple is leading in right now - is the A-series silicon. They used to lead in development tools too, like Swift. But hey, they pissed off the people who made Swift so they went elsewhere.
Do you even read? Apple had grown in revenue almost everywhere but China. It grew every category of products and services other than iPhones due to China. In a nut shell, Trump’s Tradewar cost Apple 5 billion dollars.
The difference between jobs and cook is jobs would have called it exactly what it is. He would have likely said The US trade war with China was made it extremely difficult for Apple and other US companies to perform well in China. He would have went on to say how great Apple has done everywhere else and how excited he is about the product road map. Short and sweet.
Growth in all categories hardly is indicative of failure to innovate or pricing issues when the loss in revenue can squarely be contributed to China.
From 2011 through 2017, many so-called analysts who didn't understand Apple, said that Apple stopped innovating, and the other players in the market caught up. They said Apple could not innovate without Steve Jobs.
It turns out that you can innovate without Steve Jobs (look at WayTools, Telsa, and other companies). You just really have to want it. Referring to what Steve said, R&D isn't about writing a cheque. You have to think on behalf of your customers' best interests, all-round, including fairness and providing value.
When the original iPhone dropped in price the year after it was released, Apple issued a $100 refund for every single early buyer. Apple took a small hit on the bottom line to be loyal to their customers. And that's why the Apple brand name was so strong in 2012.
2018 rolls around and finally the so-called analysts are right. Apple now increments but charges category-defining prices. iPad Pro 12.9" (512GB LTE) went from CA$1606 (2017) to over CA$1900 (2018). The damn pencil went up by 50%!!! Same goes for iPhone, Mac mini, MacBook Air - just about everything Apple makes.
If it was $1000 or more, it went up by $200-$300. Overnight. If it was under $1000, it went up to nearly $1000. Base model Mac mini went from $499 to $799. And all they did was put back the quad core that the 2012 model had that they took out in 2014. And the audacity to shout on stage at the keynote, "more cores is faster." No shit?
Is it a mystery that people aren't buying?
Steve used to say that Apple's customers were smart. If you want to lead, you got to make things for the leaders. i.e. artists, musicians, directors, and other professionals who do amazing things with their systems and push the boundaries.
But instead Apple is fooling itself thinking it can chase easy money. They send demo units to "influencers" i.e. people with YouTube channels. They hope that Apple customers are truly sheeple who just buy what "influencers" show off.
Apple is failing because it is pandering to fools, hoping that "a fool and their money soon part." They forgot their customers are artists, creatives, directors, engineers, authors, teachers, scientists.
We can easily see Intel is polishing a turd when they are at 14nm+++ (i.e. didn't do 10, 10+, and certainly didn't do 7). Nobody is going to buy their crap. Everyone is pissed off at Intel, to the point they are booting up their own silicon teams.
Perhaps the only area that Apple is leading in right now - is the A-series silicon. They used to lead in development tools too, like Swift. But hey, they pissed off the people who made Swift so they went elsewhere.
In addition I personally find Apples political correctness and its social positioning a detractor for its products and cannot be associated with some of there product advertising.
Show me 1 decision by Apple in the last year that was beneficial to the customer more-so than Apple? You can't. This company has become more about the shareholders and influence than it has about innovation, industrial design, and the customer experience.
Completely ignoring their customers needs and instead telling their customers what they want. You know, all the "Pro" users out there screaming for secretly throttled phones and bent iPads for obscene money.
Hubris. Brought them down before - it's bringing them down again. Can try and deflect with China all you want Tim - but when the stock hits $84 this summer you're gone.
Exactly. My old boss who was an Apple Store owner and did education for the schools in the 80s/90s used to say, "Apple's cycle is do something really well, then get greedy and stupid, then fall, then repeat."
Apple has a lot going for them, but definitely some areas that need work.
I know that in my household (which used to be all Apple) they have lost some business. One person in our household opted for a Surface laptop because (1) he was turned off by the high price Apple charges for hardware that is rarely updated and (2) he wanted a touchscreen on the laptop. I bought a Linux-threadripper workstation because Apple doesn't sell a competitive Mac Pro and I couldn't wait anymore. I bought a HomePod last year, but everyone else dislikes it because Siri makes a lot of dumb mistakes, so they are going with Alexa-based devices.
I normally would have bought a new iPhone this past year, but I don't care about OLED, my iPhone 7+ is plenty fast for most things, the iPhone XR is a thick brick, and the XS is too expensive for what you get. I think Apple is wasting effort on AR when they should be focused on camera quality, both hardware and software. AR will be great when they can come out with AR glasses, but it's a gimmick on the phone, and not worth any kind of price premium.
I'd say the best Apple product I bought in the last year was my Apple Watch 4.
There is also another issue that nobody really wants to talk about in fear of not being PC, but nobody but a small section of the potential customer base want to listen to a potty mouth SJW CEO going on about how their customers should live their lives and what values they should hold.
If Timmy wants to be an activist - fine - keep it at the local level where it might be relevant, but the moment he steps outside the US, his message is either irrelevant because many countries gained the rights he keeps fighting for even decades ago, or it flies right in the face or their religion, culture and belief systems. Incidentally these geographies falls under Apple's definition of emerging markets. So it is not only price and currency issues that discourage customers in these markets.
You are dead right, I have the same view about Tim...
1. Apple isn't doomed; 2. The iPhone is what makes or breaks the company quarter over quarter given the amount of revenue it generates; 3. In general, the smartphone market has matured so less wow factor with each new release (more commoditized); 4. Starting with my iPhone 7 Plus the power of the processor was so good I could consider a longer purchase interval; 5. Price increases over the last few years have been too high and need to be revisited (all products); 6. Apple is not immune from the world economy and geopolitics happening all over right now...just look at the tanking market as of late.
I'm sure there are a few more but coffee needs to kick in!
Hey Tim, I would've bought a Mac mini if it wasn't ONE THOUSAND DOLLARS (in Canada)!
I would even pay the higher price if it was easily upgradeable.
Upgrade, upgrade, upgrade. Yea, except Apple knows that the vast majority do not upgrade. They know this! And yet some people continue to insist that upgradability is a make or break factor in buying decisions for the masses. Come on!
The biggest problem I see is that Apple has mostly abandoned entry-level hardware. The Mac mini is more of a pro machine now, with a pro-level price point. Same thing with the MacBook Air. The iPad mini has not been updated in nearly 4 years, and the entry-level iPhone model now costs $749 compared to $400 that the iPhone SE used to cost. I think analysts are correct in saying that Apple's future is dependent on revenue from services. However, ignoring the entry-level market is really going to hurt them in this regard. They need to sell more devices, at lower margins, in order to increase the number of users and revenue generated from services. It sounds like they are beginning to realize this if the new iPad mini rumors are true, but I believe that they really need to focus on an entry-level iPhone. I wouldn't be surprised to see a new 4" iPhone this year with some of the new features we have been seeing on the flagships in recent years like Face ID.
Apple has a lot going for them, but definitely some areas that need work.
I know that in my household (which used to be all Apple) they have lost some business. One person in our household opted for a Surface laptop because (1) he was turned off by the high price Apple charges for hardware that is rarely updated and (2) he wanted a touchscreen on the laptop. I bought a Linux-threadripper workstation because Apple doesn't sell a competitive Mac Pro and I couldn't wait anymore. I bought a HomePod last year, but everyone else dislikes it because Siri makes a lot of dumb mistakes, so they are going with Alexa-based devices.
I normally would have bought a new iPhone this past year, but I don't care about OLED, my iPhone 7+ is plenty fast for most things, the iPhone XR is a thick brick, and the XS is too expensive for what you get. I think Apple is wasting effort on AR when they should be focused on camera quality, both hardware and software. AR will be great when they can come out with AR glasses, but it's a gimmick on the phone, and not worth any kind of price premium.
I'd say the best Apple product I bought in the last year was my Apple Watch 4.
Good luck with that Surface. They’re underpowered garbage that tend to overheat. And their OS is a bloody mess. I wouldn’t take one if you paid me.
Apple has a lot going for them, but definitely some areas that need work.
I know that in my household (which used to be all Apple) they have lost some business. One person in our household opted for a Surface laptop because (1) he was turned off by the high price Apple charges for hardware that is rarely updated and (2) he wanted a touchscreen on the laptop. I bought a Linux-threadripper workstation because Apple doesn't sell a competitive Mac Pro and I couldn't wait anymore. I bought a HomePod last year, but everyone else dislikes it because Siri makes a lot of dumb mistakes, so they are going with Alexa-based devices.
I normally would have bought a new iPhone this past year, but I don't care about OLED, my iPhone 7+ is plenty fast for most things, the iPhone XR is a thick brick, and the XS is too expensive for what you get. I think Apple is wasting effort on AR when they should be focused on camera quality, both hardware and software. AR will be great when they can come out with AR glasses, but it's a gimmick on the phone, and not worth any kind of price premium.
I'd say the best Apple product I bought in the last year was my Apple Watch 4.
Good luck with that Surface. They’re underpowered garbage that tend to overheat. And their OS is a bloody mess. I wouldn’t take one if you paid me.
I don't like Windows, either. But Apple's case is much harder to make when they don't update their products -- particularly with younger consumers (the Surface user in our house is a teenager), for whom the appearance of being "old" or "outdated" is the kiss of death.
I'm aware of all the excuses -- Intel's chips don't change that much from year to year, etc -- but it's a simple marketing reality that new beats old. Apple should know that as well as anyone.
Comments
Shouldn't that be "U.S. and China"?
Corporations have absolutely no business getting involved with setting social policy agendas. It’s a short step from there to fascism.
Things are not adding up here.
I do believe the tariff wars had more to do with this than anything else. I can tell you our Asian suppliers are working with us to reduce the tariff impact so they do not lose the business. Then you have China companies telling their employees to boycott Apple products and buy Chinese.
Yeah this is only going to get worse.
I do notice however, that I'm having a tougher time defending Apple's product prices. In discussions with friends I mostly share my outrage about them. I think twice about buying something and often don't do it, because I can't "justify it". That's a big change for a 30+ year loyal Apple-fan-boy.
From my perspective, it's about time Apple's hits a rough patch. It can only benefit us, it's customers. They've clearly gone too far. Innovation & expensive is ok. Greed is not. A correction is very much needed. If they are stubborn about it, the market will do the work for them.
It's like they are too concerned with themselves (as a company). Reminds me of good old Rome. Building palaces right up to the fall.
Brand loyalty and trust is earned over years, but can be lost in months and under Tim Cook’s Apple, they are starting to lose mine.
The difference between jobs and cook is jobs would have called it exactly what it is. He would have likely said The US trade war with China was made it extremely difficult for Apple and other US companies to perform well in China. He would have went on to say how great Apple has done everywhere else and how excited he is about the product road map. Short and sweet.
Growth in all categories hardly is indicative of failure to innovate or pricing issues when the loss in revenue can squarely be contributed to China.
I know that in my household (which used to be all Apple) they have lost some business. One person in our household opted for a Surface laptop because (1) he was turned off by the high price Apple charges for hardware that is rarely updated and (2) he wanted a touchscreen on the laptop. I bought a Linux-threadripper workstation because Apple doesn't sell a competitive Mac Pro and I couldn't wait anymore. I bought a HomePod last year, but everyone else dislikes it because Siri makes a lot of dumb mistakes, so they are going with Alexa-based devices.
I normally would have bought a new iPhone this past year, but I don't care about OLED, my iPhone 7+ is plenty fast for most things, the iPhone XR is a thick brick, and the XS is too expensive for what you get. I think Apple is wasting effort on AR when they should be focused on camera quality, both hardware and software. AR will be great when they can come out with AR glasses, but it's a gimmick on the phone, and not worth any kind of price premium.
I'd say the best Apple product I bought in the last year was my Apple Watch 4.
1. Apple isn't doomed;
2. The iPhone is what makes or breaks the company quarter over quarter given the amount of revenue it generates;
3. In general, the smartphone market has matured so less wow factor with each new release (more commoditized);
4. Starting with my iPhone 7 Plus the power of the processor was so good I could consider a longer purchase interval;
5. Price increases over the last few years have been too high and need to be revisited (all products);
6. Apple is not immune from the world economy and geopolitics happening all over right now...just look at the tanking market as of late.
I'm sure there are a few more but coffee needs to kick in!
I'm aware of all the excuses -- Intel's chips don't change that much from year to year, etc -- but it's a simple marketing reality that new beats old. Apple should know that as well as anyone.