Editorial: Apple's iPhone strategy is bad for investors, good for consumers

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Comments

  • Reply 21 of 93
    fred1fred1 Posts: 828member
    Very well written, in my mind. 
    To me what makes me want to spend my hard earned cash on a new phone is the features. “Why is this model that much better than what I have?”  Carriers’ subsidies aren’t worth anything where I live so buying a new phone is a big cash outlay. I had the 5, gave it to a friend when I got the 7, and we’re still using both. If the 2019 models have enough improvements over the 7, I’ll buy one. Otherwise it’s next year. Maybe. 
    watto_cobra
  • Reply 22 of 93
    rko said:
    Once you get used to having an integrated stylus available, apple phones become a second choice, even with all the positives.  If apple were to release an iphone with an integrated stylus, it would become a top choice.  maybe the galaxy note market isn't worth it? 
    The stylus - another small part to lose and buy a replacement that also will be lost in no time at all.
    baconstangwatto_cobra
  • Reply 23 of 93
    magman1979magman1979 Posts: 1,222member
    rko said:
    Once you get used to having an integrated stylus available, apple phones become a second choice, even with all the positives.  If apple were to release an iphone with an integrated stylus, it would become a top choice.  maybe the galaxy note market isn't worth it? 
    Good god, ever since Apple’s adjusted Q1 guidance was made public, you trolls have swarmed every site in existence to pile on the BS and FUD as thick as you can.

    Get an f’ing life and get lost! You’re not welcome.
    macseekerbaconstangracerhomie3cornchipwatto_cobra
  • Reply 24 of 93
    78Bandit78Bandit Posts: 238member
    It isn't so much quality as it is a lack of "must have" features available only on newer devices.  My iPhone 6 Plus was still perfectly serviceable after four years.  No, it didn't have 3D touch, live photos, Animoji, or 4K video recording, but ultimately that matters to a small percentage of customers.  There were noticeable improvements in display, camera, security, and features between the original iPhone, the 3G, the 4, the 5, and the 6.  Things have been pretty stagnant since.  Even full screen AMOLED on the X wasn't a drastic improvement over the Full HD display on the 6 Plus from a user standpoint, and FaceID is different (but not necessarily better) than TouchID.  For a majority of users who use their smartphones for selfies, Facebook, Instagram, and Candy Crush there was no compelling reason to get the high priced new phones.

    Apple has also hurt itself with its policy of selling two, three, and even four year old designs as new.  These phones are perfectly fine, but as a result they are also continuing to support the original devices sold years ago with OS updates.  You can put iOS 12 on a 5S from 2013 and have a fully functional phone.

    My personal opinion is Apple needs to simplify its product offering.  Sell only one year old devices as the "cheap" option and discontinue OS updates three years after the device's original introduction.  That would mean the 7 would have been the oldest device to get iOS 12 and we would have the 8, 8 Plus, XR, XS, and XS Max as the devices offered for sale new.  It would encourage more upgrades and also take some of the wind out of the secondary market.  Even this would be better than a majority of Android devices which get only one or two OS updates at best.
    edited January 2019 muthuk_vanalingamdesignr
  • Reply 25 of 93
    How come a strategy which was good for investors in the last 10 years became bad for the same investors in a matter of 3 months??? It is not as if Apple has changed their strategy with respect to the quality/longevity of the iPhones dramatically in the last 3 months. This editorial is beating around the bush, without addressing the core issues. 
    Nobody said that it was good for investors for the last 10 years.
    Then how do you explain Apple becoming the FIRST company in the world to have a Trillion dollar valuation not so long ago? 
    It was mispriced?
    baconstang
  • Reply 26 of 93
    Andrew_OSUAndrew_OSU Posts: 466member, editor
    sirozha said:
    The article claims this strategy will be good for investors in the long run. Care to elaborate how? 
    The premise is this: investors tend to look towards the short term, which is why Apple stock is always so volatile. For many many years, iPhone growth was explosive. It wasn't just upgraders, it was people who were new to smartphones. As the market became saturated, and the fact there are a finite number of people, iPhone sales couldn't continue to grow at the same rate. Now that they've slowed, investors are starting to panic that Apple is losing its mojo.

    Instead of trying to lower iPhone prices and boost sales in the short term as investors are keen on, Apple is actively working on making devices last longer. iOS 12 was a big part of that, running on all devices iOS 11 supported. This helps now, and for the next couple years as more and more people are able to use hand-me-down or second-hand devices. By getting so many people on iPhone, Apple can continue to push services by way of the App Store, iCloud Storage, Apple Music, iTunes, etc. In the future, Apple is clearly looking for additional services to provide users that keeps them with the ecosystem and keeps revenue growing. This is great for consumers who get such long-lasting devices but may not show huge dividends for a little while as iPhone sales lower and services grow.
    cornchipwatto_cobra
  • Reply 27 of 93
    Andrew_OSUAndrew_OSU Posts: 466member, editor
    Then how do you explain Apple becoming the FIRST company in the world to have a Trillion dollar valuation not so long ago? 
    As Mike said, it should still be a trillion dollar company. The reason it climbed so fast was because of the unsustainable growth of iPhone sales which has finally leveled out a bit. It is still growing, but not at the breakneck speed it once was. Now Apple has to capitalize on the massive install base they have with accessories (Beats, Apple Watch, AirPods) and services (App Store, iCloud, iTunes, Apple Music) both of which are now growing like crazy.
    cornchipwatto_cobra
  • Reply 28 of 93
    tomahawktomahawk Posts: 164member
    In reality the best thing for consumers and Apple would be to return to the iPod mentality with more of their devices, especially as they are trying to transition to making more profits off services.

    The iPod was able to dominate the market, in part due to Apple choosing to release iTunes for Windows and therefor making the product available to nearly the entire market. Apple continued this support with the iPhone and iCloud (at least to some level).  Apple also significantly increased their Mac sales when they went to Intel and began offering Bootcamp.

    Along the same lines, Apple should work to make the Apple Watch functional for Android users.  While I doubt it would be "easy", you can't tell me Apple can't come up with a process to allow an Android version of the Watch app act as an intermediary for apps on both the watch and Android phone.  As the Apple Watch is continuing to grow in capabilities I expect eventually it will be able to function as a completely standalone device.  When it reaches that point, owning the Watch market in the same way Apple owned the MP3 market will leave them in a position to get ALL of the service revenue from that market.

    Apple also could work to add Windows and Android functionality for the Apple TV.  If Windows and Android devices could stream to Apple TV (without a software purchase from a 3rd party), especially if they could discover the devices via Bluetooth and create their own WiFi channel as they can on macOS, you could make a case to attach one to every projector at every school in the country.  Just getting all those Apple TVs into circulation would significantly increase the install base as more and more services become available for them.

    If Apple wants to be a service company, they need to ensure their services are available to the widest possible market.  Especially a market they have a competitive advantage and can own like the smartwatch category.
  • Reply 29 of 93
    Well, it’s AI’s prerogative to put their spin on this - for myself (and many others) while I generally feel Apple has very good build quality for devices that may last years, for a device that one carries with them daily, the risk of something happening to it (theft or other damage) is high.  I am super careful with my stuff but no one else in my family is quite so careful (sorry to say it family). So, now insurance is a requirement because repair and replacement costs are so high - and, to boot, insurance on a high cost device is not so trivial in cost.  In the last two years (since the intro of the X) owning an iPhone is akin to owning a car - you gotta finance it and you need to insure it.  That’s too much for me - as much of an Apple fan as I am, more and more of their products remain behind the display window at the store than at home with me.
    cornchip
  • Reply 30 of 93
    canukstormcanukstorm Posts: 2,532member
    avon b7 said:
    I switched just over four years ago with the dilemma mentioned in this piece. I was priced our of the iPhone market (new phone), but picking up a much older iPhone (refurbished or second hand) was a ridiculous proposition as I could get a new phone with very competitive hardware for (in those days) 200€.

    New phone. Modern technology. Amazing build quality. Fast charging. Extra storage etc. It was Android but I liked the system much more than iOS.

    Nowadays, you can pick up amazing new phones that leave four year old hardware in the dust for 250€ (or less!) and follow a far shorter upgrade path or hang on to it for longer if you wish. 

    You would have to be an iOS die hard to pick up a four year old iPhone as your main phone.

    I think my situation is pretty indicative of many people who were in my situation and it is one of the reasons iPhone sales flattened.

    New, far cheaper phones from competitors are more than good enough on every level.

    The big difference between today and four years ago is that competitors are offering amazing phones at every price band right up into premium and far beyond.

    Plenty of options at plenty of prices.

    Apple has very limited options and an 's' cycle which is now taking the edge off of its ability to react to market trends.
    "The big difference between today and four years ago is that competitors are offering amazing phones at every price band right up into premium and far beyond."

    Those competitors offering high-end smartphones at dirt cheap prices won't be around too long since they won't be making any money.
    cornchipwatto_cobra
  • Reply 31 of 93
    Mike WuertheleMike Wuerthele Posts: 6,256administrator
    Well, it’s AI’s prerogative to put their spin on this - for myself (and many others) while I generally feel Apple has very good build quality for devices that may last years, for a device that one carries with them daily, the risk of something happening to it (theft or other damage) is high.  I am super careful with my stuff but no one else in my family is quite so careful (sorry to say it family). So, now insurance is a requirement because repair and replacement costs are so high - and, to boot, insurance on a high cost device is not so trivial in cost.  In the last two years (since the intro of the X) owning an iPhone is akin to owning a car - you gotta finance it and you need to insure it.  That’s too much for me - as much of an Apple fan as I am, more and more of their products remain behind the display window at the store than at home with me.
    User-induced damage is an entirely different matter versus good build quality. A well-engineered device of any sort won't handle user abuse and other accidents very well.
    edited January 2019 magman1979muthuk_vanalingamcornchipStrangeDays
  • Reply 32 of 93
    dysamoriadysamoria Posts: 3,429member
    Rose colored glasses and butt kissing. Quality has been sliding since iOS 7 and iOS 12 was barely a bump in the right direction. The Safari text editing bugs are STILL NOT FIXED. Now iOS 12.1.2 is killing WiFi.
  • Reply 33 of 93
    rogifan_newrogifan_new Posts: 4,297member
    avon b7 said:
    I switched just over four years ago with the dilemma mentioned in this piece. I was priced our of the iPhone market (new phone), but picking up a much older iPhone (refurbished or second hand) was a ridiculous proposition as I could get a new phone with very competitive hardware for (in those days) 200€.

    New phone. Modern technology. Amazing build quality. Fast charging. Extra storage etc. It was Android but I liked the system much more than iOS.

    Nowadays, you can pick up amazing new phones that leave four year old hardware in the dust for 250€ (or less!) and follow a far shorter upgrade path or hang on to it for longer if you wish. 

    You would have to be an iOS die hard to pick up a four year old iPhone as your main phone.

    I think my situation is pretty indicative of many people who were in my situation and it is one of the reasons iPhone sales flattened.

    New, far cheaper phones from competitors are more than good enough on every level.

    The big difference between today and four years ago is that competitors are offering amazing phones at every price band right up into premium and far beyond.

    Plenty of options at plenty of prices.

    Apple has very limited options and an 's' cycle which is now taking the edge off of its ability to react to market trends.
    "The big difference between today and four years ago is that competitors are offering amazing phones at every price band right up into premium and far beyond."

    Those competitors offering high-end smartphones at dirt cheap prices won't be around too long since they won't be making any money.
    They’re not all dirt cheap though. Anyway there doesn’t seem to be hard evidence that Apple is losing customers to Android - at least not outside China. China is another story and I absolutely believe nationalism comes into play even if Cook can’t admit it. Also in China consumers are tied to things like WeChat. Their buying decisions are based more on what the hardware looks like than what OS the phone is running.
    80s_Apple_Guycornchip
  • Reply 34 of 93
    The issue with all of this to me is Apple's services are not up to par to be competitive. App Store is great but Apple is pulling 30% and only from paid apps. iCloud is far far behind Google and MS versions. Apple TV is very expensive compared to competitors and not that much better. It doesn't have any NEED to have features over them. 

    If Apple sees it's future in services it has a lot of work to get there. Also as pointed out above Apple only servicing it's own ecosystem limits is adoptability is the wider business world where Google and MS along with Amazon are the mainstays
    anantksundaram
  • Reply 35 of 93
    avon b7 said:
    I switched just over four years ago with the dilemma mentioned in this piece. I was priced our of the iPhone market (new phone), but picking up a much older iPhone (refurbished or second hand) was a ridiculous proposition as I could get a new phone with very competitive hardware for (in those days) 200€.

    New phone. Modern technology. Amazing build quality. Fast charging. Extra storage etc. It was Android but I liked the system much more than iOS.

    Nowadays, you can pick up amazing new phones that leave four year old hardware in the dust for 250€ (or less!) and follow a far shorter upgrade path or hang on to it for longer if you wish. 

    You would have to be an iOS die hard to pick up a four year old iPhone as your main phone.

    I think my situation is pretty indicative of many people who were in my situation and it is one of the reasons iPhone sales flattened.

    New, far cheaper phones from competitors are more than good enough on every level.

    The big difference between today and four years ago is that competitors are offering amazing phones at every price band right up into premium and far beyond.

    Plenty of options at plenty of prices.

    Apple has very limited options and an 's' cycle which is now taking the edge off of its ability to react to market trends.
    "The big difference between today and four years ago is that competitors are offering amazing phones at every price band right up into premium and far beyond."

    Those competitors offering high-end smartphones at dirt cheap prices won't be around too long since they won't be making any money.
    They’re not all dirt cheap though. Anyway there doesn’t seem to be hard evidence that Apple is losing customers to Android - at least not outside China. China is another story and I absolutely believe nationalism comes into play even if Cook can’t admit it. Also in China consumers are tied to things like WeChat. Their buying decisions are based more on what the hardware looks like than what OS the phone is running.
    India is another example of losing to Android in a big way. Apple's strategy of premium prices and products are great in the First World.  At least until saturation starts to hit as seems to be happening. It doesn't work in the Developing World which kind of shoots the services strategy quite a bit. 
  • Reply 36 of 93
    dysamoria said:
    Rose colored glasses and butt kissing. Quality has been sliding since iOS 7 and iOS 12 was barely a bump in the right direction. The Safari text editing bugs are STILL NOT FIXED. Now iOS 12.1.2 is killing WiFi.
    Very true. Apple's software quality and ease of use have been slipping for years. I work in IT for a company and supporting Macs is a nightmare compared to Windows. Our users are in the field and get locked out regularly as expiration notification bugs that have existed for years still aren't fixed. That's inexcusable. Apple has no in house software to support Macs in the business world. JAMF is about it and it's very poor compared to Windows options. 

    iPhones only allow one MDM. That means our users who are working for a client company that requires an MDM have to choose who they get email etc from. 
    anantksundaramdysamoria
  • Reply 37 of 93
    "In the short term, this approach isn't so good for investors focused on unit sales. In the long term, however, it will pay off."

    Some of us have been saying this for a very, very long time now.
    watto_cobra
  • Reply 38 of 93

    avon b7 said:
    I switched just over four years ago with the dilemma mentioned in this piece. I was priced our of the iPhone market (new phone), but picking up a much older iPhone (refurbished or second hand) was a ridiculous proposition as I could get a new phone with very competitive hardware for (in those days) 200€.

    New phone. Modern technology. Amazing build quality. Fast charging. Extra storage etc. It was Android but I liked the system much more than iOS.

    Nowadays, you can pick up amazing new phones that leave four year old hardware in the dust for 250€ (or less!) and follow a far shorter upgrade path or hang on to it for longer if you wish. 

    You would have to be an iOS die hard to pick up a four year old iPhone as your main phone.

    I think my situation is pretty indicative of many people who were in my situation and it is one of the reasons iPhone sales flattened.

    New, far cheaper phones from competitors are more than good enough on every level.

    The big difference between today and four years ago is that competitors are offering amazing phones at every price band right up into premium and far beyond.

    Plenty of options at plenty of prices.

    Apple has very limited options and an 's' cycle which is now taking the edge off of its ability to react to market trends.
    We're so thrilled you're happy with your Android, and that you like their system better. Never mind that it's OS is full of security holes you could drive a Russian tank through. Never mind that you don't have the product ecosystem that Apple gives it's users. Go in peace to enjoy your Android device. Just don't expect us to be jealous....
    cornchipStrangeDayswatto_cobra
  • Reply 39 of 93
    How come a strategy which was good for investors in the last 10 years became bad for the same investors in a matter of 3 months??? It is not as if Apple has changed their strategy with respect to the quality/longevity of the iPhones dramatically in the last 3 months. This editorial is beating around the bush, without addressing the core issues. 
    The core issue has been addressed in other articles. It's called Donald Trump.
    watto_cobra
  • Reply 40 of 93
    Apple should operate as if their profit on unit sales is $0, so that they focus their efforts on cloud services instead. Microsoft changed course and they are kicking ass. Amazon is kicking ass. Google is kicking ass. 


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