sirozha

doggone said:

Kuyangkoh said:

GeorgeBMac said:

Separately, CNBC reports:
"People aren’t as interested in the iPhone 11 because they’re waiting for a 5G model, Piper Jaffray survey say"

https://www.cnbc.com/2019/09/23/apple-customers-hold-out-for-5g-despite-lower-prices-on-iphone-survey.html

That makes sense to me -- better to wait if you can because the arguments for not waiting are pretty weak - particularly now that iPhones tend to have 4-6 year life cycle:

5G?? Where? I upgrade every year because i can afford it....5G or not....

If you are on the Apple upgrade program, it is the same monthly price whether you upgrade every year or wait 2 years to get to keep the phone.  I have so many iPhones in my drawer now that I see no point waiting for 2 years.  Selling on Gazelle will not bring that much after 2 years ($200 for a phone in fair condition).
5G is not widely available and the modems are battery hogs.  Apple is smart to wait for a year when full coverage is available and the chips have been optimized.  

That’s ridiculous. You can sell your iPhone on eBay and net $300 for a two-year-old phone easily. The fact that you are stacking your iPhones in your drawer for years is your own laziness. 

StrangeDays said:

sirozha said:

Let’s not forget that 10 years ago, a smartphone costing $500 was a shock to the consumer. We all remember what Steve Ballmer said about a $500 iPhone. Today Apple advocates present the notion of a $500 as a joke, as if were impossible to manufacture a decent smartphone and sell it at a profit for $500. 

If you want the features of what was new 10 years ago I’m sure you can find a $500 phone. But if you want the features of a modern flagship smartphone, which incur higher development costs, it will cost more. In early days development was less expensive because it was all low-hanging fruit then. Also factor in inflation - $500 in 2007 is $617 today. Not too far off from the iPhone 11, a premium phone at $699. 

I bought a $150 brand new Motorola G7 Play, which for $150 is a phenomenal phone. In fact, had we not been so deeply entrenched in the Apple ecosystem for over a decade now, I would NEVER consider getting my kids anything beyond a $150 Android phone. Again, the Motorola G7 Play is phenomenal. 

For $500, you can get an amazing Android phone that rivals iPhone 11. By the way, the iPhone 11's price of $699 is a 64GB model, which really insufficient for a phone in this price range. It's true that the Android hardware manufacturers don't make quite as much profit margin as Apple does. We are not here discussing profit margins, though. We are discussing the price that the consumer pays. 

tmay said:

sirozha said:

The fact that the iPhone 11 Pro can last 4-5 years is trouble for Apple. It means that sale volumes will continue to drop year after year unless Apple creates a sub-$500 iPhone to lure Android users into the Apple ecosystem and then try to upgrade them to the premium-tier iPhone that can last them 5 years.  

Currently, the 2-year-old lower-tier iPhone 8 costs $499. It’s the third holiday season in a row that the iPhone 8 is offered as a lower-end alternative to the flagship that costs over $1,000. Android users can choose among mid-level modern Android phones or a two-year-old iPhone if they don’t want to spend more than $500 for a smartphone. For those in the Android ecosystem, making the jump to the 2-year-old iPhone for $500 makes no sense. 

Let’s not forget that 10 years ago, a smartphone costing $500 was a shock to the consumer. We all remember what Steve Ballmer said about a $500 iPhone. Today Apple advocates present the notion of a $500 as a joke, as if were impossible to manufacture a decent smartphone and sell it at a profit for $500. 

If Apple's users base is considered 900 million and growing, that's 180 million units a year at 5 years of life. Pretty much where we sit today, and growing means that the iPhone is already picking up net users. I agree that it makes no sense for those in the Android ecosystem to jump to the iPhone, but then again, jumping to Apple's ecosystem does in fact make sense for some Android OS users, especially those that are looking for an iPad, or Apple Watch, given the limited state of Android OS devices compared to those in Apple's ecosystem.

I don't find just comparing Apple's iPhone to Android OS devices as being particularly useful, hence, why I usually consider the whole Apple ecosystem vs Android.

The Android ecosystem is much more solid than Apple’s. Apple’s iCloud is child play compared to similar Google services. Entire companies, including large ones, run on Google cloud services. It’s impossible to run even a small business on the Apple cloud services. It’s only good enough for the household, not for any business. School systems use Google cloud services almost exclusively. 

The fact that the iPhone 11 Pro can last 4-5 years is trouble for Apple. It means that sale volumes will continue to drop year after year unless Apple creates a sub-$500 iPhone to lure Android users into the Apple ecosystem and then try to upgrade them to the premium-tier iPhone that can last them 5 years.  

How would you know that? How do you know if the extended lead time is due to an increased demand or due to a lower inventory?

sacto joe said:

sirozha said:

randominternetperson said:

First, I wouldn't put much weight in this type of analysis.

However, isn't their conclusion exactly backwards using their own logic?

However, while the iPhone 11's lead time is relatively lower than the iPhone 11 Pro range, it reported six days for the first week and 12 days in the second week. The doubling of the lead time "implies to us increased interest in the 'lower end' model that initially anticipated by Apple and the supply chain," writes JP Morgan.

Think that through.  There is a longer lead time for the Pro and Pro Max than the non-Pro model.  In other words, demand is outstripping supply more for the high end models than the "low end" non-Pro model.  Doesn't that imply that there is increased interest in the "higher end" models?

Yet AI says:

The increase in lead times for the iPhone 11 suggests demand for the new iPhone models is higher than the supply chain anticipated, according to JP Morgan, with the lead time growth for the value-based model seemingly indicating consumers are not focusing their purchases on the higher-end models as was previously predicted.

Apple got burned last year on the overproduction of the iPhone Xs and Xs Max. They most likely cut the production this time. In the past, lead times were 4-6 weeks, so the lead time of a couple weeks is much shorter than the lead times of the yesteryear. You can't extrapolate demand from the lead time. Most likely, Apple has manufactured iPhone 11 in much larger quantities than iPhone 11 Pro. Apple doesn't consider a two-week lead time to be too dramatic for them to take a risk and overproduce iPhone 11 Pro again. 

They most likely did NOT cut production this year, since last year iPhones were still back-ordered. There’s a difference between cutting production capacity from the get-go and turning down production capacity as demand slacks.

So the reason for the increased demand lies elsewhere, not reduced production capacity. Nice try, no cigar.....