brucemc

From the article:
"According to data compiled by Neil Cybart of Above Avalon, Apple's iPhone installed base is now around 750 million users. Yet over the last fiscal year, Apple's total iPhone sales were just above 216 million. That's a lot of phones, all of which are "premium" by industry standards."

I subscribe to Above Avalon and so get all of this data from Neil.  Just to note that his definition of "installed base" is those who have purchased their iPhone new direct from Apple or reseller.  It does not include those who get hand-me-downs, or purchased from the used market.  He lumps those into the "iPhone user base" (number of persons who own/use an iPhone regardless of how acquired) which is estimated at over 900M now.

So in the next year or so, Apple is likely to cross the threshold of having over 1 billion active (unique) iPhone users...

davgreg said:

The problem with Apple's marketing strategy is that many of us want a great smartphone but do not care about Face ID, Augmented Reality, Fake Bokeh Cameras or the price premium of OLED. We are consigned to older HW with less capable CPU/GPUs and such.

While there are many who use their phone as their go to device, many of us do not. I have an Apple Watch, iPad Pro, MacBook Pro, Apple TV HD, Mac Pro Workstation and Mac mini, so do not fly the response that some of us are just of the wrong generation to understand. I doubt anyone who can afford proper HW would prefer to squint at an iPhone to do much of anything productive.

Apple is fighting the maturity of the market by driving the average selling price higher and higher, but even that has limits. The top model of iPhone is now priced in MacBook Pro territory which is crazy by any standard. They are simply not worth the money being charged and eventually the masses will figure that out.

Apple cannot endlessly march the price of phones up, but Wall Street wants constant growth. Will Apple at some point become a finance company to capture the interest charges associated with carrying the lease/rental of devices? That is the path General Electric got on and it almost tanked the company- they had to pretend to be a Bank during the 2007-8 market meltdown and got TARP money in a bailout. GE has never recovered and is currently selling off the furniture trying to stave off bankruptcy.

You suffer from the same issue as the other poster I responded to - in that you seem to think the vast majority of iPhone owners think the same as you, and have the same use cases as you.  And that Apple doesn't sell a device that fits your use cases.

That iPhone X was the best selling single model throughout 2018 should give enough evidence that a large number of people do want those latest features, including Face ID, or augmented reality, or portrait mode, or great video recording, or fast responses, or quality of manufacture...Unlike you and Cropr, it seems many in the world enjoy such features, and make use of them.  Also, if you read the comments here at all, you might figure out that with trade-in value (especially for those that trade every year or 2), they are not really paying that list price out of pocket.  On a per-hour-of-use basis, the iPhone may be the most cost effective consumer electronics device that people own, even at the high end.  

Now about you - well if you don't care about any high end or latest h/w features, then surely you could be well satisfied with an iPhone 8 @ $599, or an iPhone 7 @ $449.  The iPhone 8 has the A11 Bionic, is faster than most Android flagships still, will likely be supported "with new software" for at least 4 "more" years (and usable for a few more).  I have an iPhone 7 (will likely upgrade to Xs this year), but outside of my battery life degrading now that it is almost 2 years, the phone operates perfectly.  For someone with limited use cases but enjoys all the benefits of iOS, it can easily be their device for 3-4 more years.

But sure...Apple doesn't really know what they are doing...

cropr said:

JinTech said:

Same. What I find funny is when I told a sales rep at one of the Apple Stores in my area that I ordered the iPhone XS Max with 512GBs he flat out asked I needed that much storage or that much power. Mind you, he doesn’t even know me or what I plan on doing with the phone. I found it absolutely absurd that an actual Apple employee would question my buying habits of their own products!

I don't think that it is commercially a great strategy for a  sales rep to ask such questions, but nevertheless he/she has a point.

The apps I am frequently  using on my smartphone are: email app, browser app, slack, trello, banking app, train tickets app, spotify and an oocasional game.  I take less than 50 photos a year and I never record a video.  Conclusion a mid range $300 smartphone would be more than sufficient to fulfill my needs.  Because I own a app development company, I have always a high end iPhone and Android device with me  to demo my apps. 

 95% of the users have a very similar usage pattern (with maybe  some more games in the mix). So they too could live with a mid range smartphone. Luckily for Apple stores sales rep, his/her customers (like you) are convinced by the marketing machine of Apple they need the latest and the greatest.

Most users are still convinced that unless you buy a high end smartphone of $800 or more, you get crap.  This was true in 2015, but not any longer  In the last 3 years the mid range smartphones have improved much more than the high end

Would be interested in the research you have to back up this claim.  No doubt some are of course, but 95% of iPhone owners only use a handful of apps that take little memory, and barely take photos and no video?

Well, that doesn't describe me (not a power user at all, but photos & video consume a good bit on my phone), and certainly not my wife & kids (who struggle with 64GB, mostly due to photos).  

And your claim doesn't backup the increasing services revenue which point to more app usage.

Perhaps you are just full of shit...

Apple Glasses will be Apple's next "new new" product.  All of their investment in AR is pointing in this direction.  The AR demos you have seen at the last two WWDC's look awesome, but are hindered by having to hold up an iPhone or iPad to experience them, which is a less-than-ideal user experience.  AR with smart glasses will provide a whole new level of experience.  

Will the market be big?  I believe it will over time.  For a first release (I am thinking 2021...2020 would be pushing it...) expect it would be relatively small.  Maybe sub 10M.  But features and use cases will grow from there.  And that is just the "AR" consideration.  It is possible that Apple could approach it similar to Apple Watch - rethinking the "glasses" experience.  With AW, Apple brought to market the best method for easily & quickly swapping bands, and also brought about "better bands" (better materials, magnetic clasps) - items that had nothing to do with the technology of a smart watch, but were key to the experience.

Apple Watch + AirPods + Apple Glasses will become (combined) a business that is close to the iPhone...

As noted in the article and some comments, Apple could very well have this targeted at other sensor types other than glucose monitoring.  But my point below applies in either case.

If Apple develops these sensors on their own (in-house, or exclusively with partners), then by adding them to Apple Watch they will truly leap ahead of the competition on those functions alone.  The Apple Watch will become the iPod of wrist wearables, but in an (eventual) much larger market.

If a 3rd party develops the (wrist wearable) sensors independently of Apple, what are the going to do?  Try to start their own smart watch product?  Sell to those with only a small market share?  Or sell to all - including the leading smart watch vendor with majority of market share and most of the premium market?  So then Apple has the sensors for AW and ability to move the most, sell at the highest ASPs to get the best sensors. 

In other words, Apple will win in either case.