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Supply Chain Indicators Point to Poor February for Apple
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I'm actually surprised the iPhone 5 appears to have brought up Apple's share as much as it did. Windows Phone really seems to be taking a beating.
The global smartphone market is also still expanding and thus, even though Apple's share of the total may be falling, their sales are still growing (perhaps not as fast as before). The largest markets (China, India, others?) are largely not as wealthy yet, but improving. As the people become wealthier over time, Apple's potential market of "premium" buyers will improve (that doesn't guarantee sales by itself of course, but the potential is there).
Yeah... that plays a big part in it too.
Low-priced phone sales will increase in under-developed countries faster than high-priced phone will.
And that only matters if you think the sales number is the most important thing.
Samsung wears the crown of "largest smartphone vendor by volume" and that's a wonderful thing.
However... I don't think Apple ever wanted to sell the "most" smartphones... they want to sell the "best" smartphones.
I'm not sure Apple is really crying about the fact that they only sold 47 million iPhones last quarter...
Confused Objectives for Reporting?
For goodness sake, pack in the Schadenfreude!
It is fascinating to hear about potential new developments, expected delivery dates, and thoughts about how Apple and related industries might develop. Even the carping anti-Apple fraternity cannot deny that Apple helps to force the pace and direction of development.
Those who feel glee at any bad news about Apple itself have enough other places to congratulate one another.
Or should I say that those of us who are interested in news and ideas can find these in a lot of other places where the commentators feel less need to create a negative ambience of glorifying speculative bad news?
Wake up and smell the roses instead of spreading the sewage.
For goodness sake, pack in the Schadenfreude!
It is fascinating to hear about potential new developments, expected delivery dates, and thoughts about how Apple and related industries might develop. Even the carping anti-Apple fraternity cannot deny that Apple helps to force the pace and direction of development.
Those who feel glee at any bad news about Apple itself have enough other places to congratulate one another.
Or should I say that those of us who are interested in news and ideas can find these in a lot of other places where the commentators feel less need to create a negative ambience of glorifying speculative bad news?
Wake up and smell the roses instead of spreading the sewage.
Math was off a bit, but his point was that Apple made around 13 billion on iTunes/Software/Services in 2012. Around 7% of their total revenue.
What Has Apple Done For Us Recently?
I buy Apple gear because of how it performs, and how it suits what I want to do, and not - as you apparently do - as a critique on their rate of innovation. However, let's have an objective look at what has been happening:
Apple was a key part of creating the Personal Computer revolution. Changed the way in which we consumed music (with the iPod and iTunes), and in doing so killed the CD & DVD. Is changing the way that we consume movies and TV, and will progressively further disrupt those businesses to the advantage of the consumer. Overturned the mobile phone business paradigms, liberalising access to huge bandwidth on phones against industry trends (that was the key initial breakthrough with the iPhone - the deals with the carriers over data). Changed the way in which we communicate by phone and access the internet on the move. Decimated the still and mobile camera industries by providing a useable alternative integrated into the portable computer they sell as a phone. Created an ecosystem that has contributed to ease of useful access to the Cloud. Introduced a new class of personal computing with the tablet that is now progressively disrupting print media of all kinds, as well as continuing the change in how we consume TV and movies.
Competition is healthy, and it is good that others put Apple under pressure so that there is no resting on the laurels, and so that there is downward pressure on prices and a constant need for further innovation and development.
However, please clarify one thing. When you punish Apple for lack of innovation by buying from someone else, who exactly are you going to turn to? Everyone else is following and not leading.
If you are aware of any better all-round offerings (and lets not be silly focussing on half a dozen more pixels on a screen or the availabilty of more colours of handset) please do tell!
I buy Apple gear because of how it performs, and how it suits what I want to do, and not - as you apparently do - as a critique on their rate of innovation. However, let's have an objective look at what has been happening:
Apple was a key part of creating the Personal Computer revolution. Changed the way in which we consumed music (with the iPod and iTunes), and in doing so killed the CD & DVD. Is changing the way that we consume movies and TV, and will progressively further disrupt those businesses to the advantage of the consumer. Overturned the mobile phone business paradigms, liberalising access to huge bandwidth on phones against industry trends (that was the key initial breakthrough with the iPhone - the deals with the carriers over data). Changed the way in which we communicate by phone and access the internet on the move. Decimated the still and mobile camera industries by providing a useable alternative integrated into the portable computer they sell as a phone. Created an ecosystem that has contributed to ease of useful access to the Cloud. Introduced a new class of personal computing with the tablet that is now progressively disrupting print media of all kinds, as well as continuing the change in how we consume TV and movies.
Competition is healthy, and it is good that others put Apple under pressure so that there is no resting on the laurels, and so that there is downward pressure on prices and a constant need for further innovation and development.
However, please clarify one thing. When you punish Apple for lack of innovation by buying from someone else, who exactly are you going to turn to? Everyone else is following and not leading.
If you are aware of any better all-round offerings (and lets not be silly focussing on half a dozen more pixels on a screen or the availabilty of more colours of handset) please do tell!
Ah makes more sense, didn't know that Apple made as high as $13B in revenue outside of hardware sales. Anyhow point being, Google having their maojority of their revenue through ad sales is not different from Apple having most of their revenue coming from hardware. Nothing wrong but nothing different.
Highest margin, not necessarily best.
Zune's final iterations were fantastic, and very arguably better than the iPod, but it was too late.
Similarly, RIM could come out with the world's most amazing smartphone tomorrow, and yet it wouldn't get given the time of day by Android and Apple's staunch fan-bases.
With regards to share price, Apple need to take the rough with the smooth. For a period, they were reinventing areas of computing that had been forgotten (Smartphones and tablets had already been done poorly, and largely abandoned as technology or lack of consumer appetite was lacking), and Wall Street treated that as Apple's baseline which made many an Apple shareholder wealthy. However, as Apple have stuttered with several iterations of iOS, and hardware updates have been incremental, Wall Street are no longer baking in constant innovation into the share price.
If Apple comes out with something great in the coming months, then all the fanboys cum wannabe traders will be happy, and if not Wall Street will be vindicated.
The stock market is a reflection of expectations on a company, not always just the present. Everyone got caught up in the Apple hype, some Apple fans made lots of money out of it, and now things are settling down.
It's true, while the cake is growing, Apple's pie is also growing. However, the transition to smartphones will hit a ceiling as well, probably in less than 3 years.
Emerging markets are of course a chance, but also a problem. Apple doesn't have anything in store for people with a small budget, so potential buyers will inevitably be driven towards the competition. And maybe stay there.
This is not simply a "war" about devices, it's about platforms. Both platforms have a tendency to be sticky. If you have an Android phone or iPhone, chances are your next phone will be of the same kind. Otherwise you'd lose all your apps, you'd have to move your cloud accounts etc. It's hassle. And as long as the other side doesn't offer a compelling reason, people won't switch. also, you're much more likely to buy a tablet and use services (music store etc) of the same platform.
That's why market share matters quite a lot, despite what people pointing towards Apple's profits say.
Apple has to do something about it, and it looks like they will.
How can a company that only sells 11 products that haven't changed much in the last
couple of years and is run by a so called logistics genius have a supply chain problem?
couple of years and is run by a so called logistics genius have a supply chain problem?
Oh god, now we can't even wait until economic quarters!? We have to read the "tea leaves" of Apple misfortune monthly now? How about we just skip right to Hourly prognostication.
Hate the stock markets, private company BS that thinks itself the 4th branch of US government and masquerades as "public".
Hate the stock markets, private company BS that thinks itself the 4th branch of US government and masquerades as "public".
The only problem with that, though, is Android 5 (Key Lime Pie) will be out soon. In May, I think.
And what happens when Apple enters their sandboxes? Everyone Apple is in, Apple is beating them.
When the low cost iPhone hits, you'll see Samsung plummet.
----------
Or has Apple only hit a ceiling in the markets it's in? Remember, Samsung is in every market out there..every cell provider and every carrier.
Apple is not..not by a long shot.
So who has room to grow and who doesn't?
I have to agree with many here.
I hoped and wished Apple did something new sooner than later but I still believe in the company.
They are just 1 new "product category introduction" away from going back to 700+ stock price (slowly but surely).
Traditionally, Apple has always jumped to new product category as soon as it realized that competition is catching up.
iPod -> iPhone -> iPad and so on...
I think they just need to announce iTV or some other solid revenue generating stream. IMO iWatch won't cut it! It can be a hobby like AppleTV but will not entice the customers and shareholders.
I hope as usual, Apple has been working something groundbreaking while everyone was trying to beat iPhone.
There was a time when Apple used have event in January to announce next big thing but since they stopped doing that I am not sure when to anticipate new product that Wows everyone!
Just wait and watch!!
I hoped and wished Apple did something new sooner than later but I still believe in the company.
They are just 1 new "product category introduction" away from going back to 700+ stock price (slowly but surely).
Traditionally, Apple has always jumped to new product category as soon as it realized that competition is catching up.
iPod -> iPhone -> iPad and so on...
I think they just need to announce iTV or some other solid revenue generating stream. IMO iWatch won't cut it! It can be a hobby like AppleTV but will not entice the customers and shareholders.
I hope as usual, Apple has been working something groundbreaking while everyone was trying to beat iPhone.
There was a time when Apple used have event in January to announce next big thing but since they stopped doing that I am not sure when to anticipate new product that Wows everyone!
Just wait and watch!!
Which markets are you talking about? Moon and Mars?
Wake up. There is not much room left to grow. China Mobile and quite likely NTT DoCoMo will be the last big names added this year.
If you are hinting at emerging markets: they are just that, emerging. It will take decades until they are on a level playing field, and smartphones will be long gone by then. Until then, people in India, Brazil and China are happily buying Android phones in very large numbers. Unless of course, Apple comes up with a substantially cheaper iPhone.
As I explained in the remainder of the post you quoted from, however, that doesn't matter. Android phone manufacturers are very slow to actually release Android updates for their devices. Android updates aren't as straight forward as with iOS
Android process:
Google releases -> Manufacturer releases -> user can download
iOS process:
Apple releases -> user can download
I've still overly simplified the Android process, because many manufacturers will seperately release updates for each of their devices (or not release an update for some devices at all.)
Thus Apple needs not release a version of iOS better than whatever Google's latest and greatest is, because most OEM's are still rolling out Android 4.
I think what Apple has been missing is their ability of amazing the world by offering people what they want before people even realize they wanted it. Those asking "what innovation do you expect Apple to do?" are missing the point - Apple should know that before we do. The iPad is the perfect example of that: many of those who originally said "LOL, tablets!" have an iPad now.
The thing is, Apple is horrible at keeping secrets. We had so many iPad 3 leaked parts that someone could almost assemble one with the leaks. Apple is not going to announce tomorrow something completely unheard of; we will know about any big announcement months in advance. The fact there is nothing new coming in the next months is, then, somewhat disappointing.
The iWatch could be the next big innovation, just like the iPad: something people originally think is useless, until Apple surprises everyone with an unique take.
IMO, something like the Google Glasses would be perfect for this. Google lacks the ability and the creativity to do anything interesting with it. Apple, in other hand, could use one to its full potential:
Imagine a GPS that shows directions over the streets as you drive
Imagine a display projected directly in front of your eyes. The fight about a mobile device's screen size would become irrelevant - it could be made to take almost your entire field of vision if you want it.
Imagine how immersive a movie or a game could be as it fills everything you see. There could even be Occulus-like enhancements to use head movements to change what you see.
Imagine a set of glasses linked to twin armbands that would recognize finger gestures (by reacting to muscle movement in the arms) and allow people to write using a completely virtual keyboard.
Unfortunately, I think a true computer image recognisition software (in other words, allowing a computer to truly see) is as impossible as flying cars. If it were possible, though... There's a comic in which the main character has glasses that replace reality - cars are shown as carriages, people are shown as elves, buildings are shown as castles, and so on. This is the end line of the technology that could be introduced through iGlasses.
The thing is, Apple is horrible at keeping secrets. We had so many iPad 3 leaked parts that someone could almost assemble one with the leaks. Apple is not going to announce tomorrow something completely unheard of; we will know about any big announcement months in advance. The fact there is nothing new coming in the next months is, then, somewhat disappointing.
The iWatch could be the next big innovation, just like the iPad: something people originally think is useless, until Apple surprises everyone with an unique take.
IMO, something like the Google Glasses would be perfect for this. Google lacks the ability and the creativity to do anything interesting with it. Apple, in other hand, could use one to its full potential:
Imagine a GPS that shows directions over the streets as you drive
Imagine a display projected directly in front of your eyes. The fight about a mobile device's screen size would become irrelevant - it could be made to take almost your entire field of vision if you want it.
Imagine how immersive a movie or a game could be as it fills everything you see. There could even be Occulus-like enhancements to use head movements to change what you see.
Imagine a set of glasses linked to twin armbands that would recognize finger gestures (by reacting to muscle movement in the arms) and allow people to write using a completely virtual keyboard.
Unfortunately, I think a true computer image recognisition software (in other words, allowing a computer to truly see) is as impossible as flying cars. If it were possible, though... There's a comic in which the main character has glasses that replace reality - cars are shown as carriages, people are shown as elves, buildings are shown as castles, and so on. This is the end line of the technology that could be introduced through iGlasses.
It Depends on How YOu Define Narrow Focus
I heartily agree with you, and note with amusement some people's definition of narrow focus - possibly a matter of perception failure.
In this context, should we be worried about Toyota also, who are currently showing a very worrying degree of focus on cars? Boeing and Airbus appear similarly challenged.
Actually, compared with Boeing, Apple appear to have a pretty diverse lineup.
I heartily agree with you, and note with amusement some people's definition of narrow focus - possibly a matter of perception failure.
In this context, should we be worried about Toyota also, who are currently showing a very worrying degree of focus on cars? Boeing and Airbus appear similarly challenged.
Actually, compared with Boeing, Apple appear to have a pretty diverse lineup.
Yeah, three years ago Apple basically took a dead category and made it the entire future of personal computing, an achievement for which any other company would be considered safe to rest on laurels for a decade. But it's Apple, so what have they done for us LATELY?
and yet...
they will make billions upon billions. they industry is just trying to drive apple stock down because they fear actual work. Apple will be bringing out the mac pro this year and while it wont be a market leader it will most certainly make them a crap-ton of cash. I personally will be buying one. Along with a new macbook pro retina in the next couple years. I might even breakdown and buy an iPhone if the current campaign to drive down prices for canadian phone plans is successful.
they will make billions upon billions. they industry is just trying to drive apple stock down because they fear actual work. Apple will be bringing out the mac pro this year and while it wont be a market leader it will most certainly make them a crap-ton of cash. I personally will be buying one. Along with a new macbook pro retina in the next couple years. I might even breakdown and buy an iPhone if the current campaign to drive down prices for canadian phone plans is successful.
How can a company that only sells 11 products that haven't changed much in the last couple of years and is run by a so called logistics genius have a supply chain problem?
The iPhone, for example, sold 500,000 units a day last quarter. And the iPad sold 250,000 units a day.
Apple must be ordering parts by the tens of millions to meet demand.
Maybe the suppliers can't keep up? The "suppliers" are the biggest part of the "supply chain"
You might be disappointed as many of us Mac Pro users already are.. I am sure the next Mac Pro or whatever it will be will NOT resemble anything Mac Pro we are all used to. Consider the Mac Pro to be dead and out of the ashes will rise a hybrid of mac mini or iMac with PRO next to it.
I expect the next Mac Pro to not be as expandable as the former ones, given Apple's direction thus far towards consumer and not pro user.
I expect the next Mac Pro to not be as expandable as the former ones, given Apple's direction thus far towards consumer and not pro user.
The problem is all that regarding Apple is retrospective. Going forward iPhone marketshare is expected to stagnate as Samsung widens its lead. We got a glimpse of this at last Qs earnings, which were great, but did not blow out as expected. It's the reason Apple shares have been drifting down since just after the iPhone 5 launched.
As for feature phone vs smart phone, your argument sounds a lot like when Apple let the PC market slip out of its hands to low cost Microsoft's DOS then Windows. There is no "artificial" smartphone market, the entire market is smartphones, a category Apple all-but reinvented and should have a commanding lead, just as they should have led in the PC.
If it doesn't act, yes, it will be. All of your rah-rah-rah-sis-boom-bah facts notwithstanding, you have to put them in context to the other little fact that Apple reinvented this smartphone market, and with one fell swoop destroyed Palm and mortally wounded Blackberry, the leaders at the first iPhone's intro. Apple has all-but squandered that lead by failing to keep the OS relevant and modern; buy keeping the phone relatively unchanged model after model; etc., as mentioned in my previous posts.
Now here is Samsung, which has always been a decent phone maker, takes Android, previously unusable in a phone or anything else and starts making phones that make people 2nd guess the iPhone. Yes, that's a problem for Apple.
And it will take 2 years for Key Lime Pie, and its features, to make any sort of headway.
Gingerbread is in the lead with 44% and it was released in early 2011.
Ice Cream Sandwich is in 2nd place with 28% and it was released in late 2011.
The current Jelly Bean is in 3rd place with 15% after 9 months on the market.
So whatever amazing new features Google comes up with for Key Lime Pie... not many people will be able to use them.
unrealistic
The next big thing has never been a quarterly / annual event. The phone and tablet market are starting to mature and the competition has inevitably caught up with apple (very easy when the direction is set out for you). At this point you'd expect sales growth to flatten.
Google glass is innovative and has the potential to be category defining, but who's to say apple doesn't have something up their sleeve which is as interesting? Openness isn't part of their product development approach and unless they're ramping up production they can probably keep leaks under control...
The next big thing has never been a quarterly / annual event. The phone and tablet market are starting to mature and the competition has inevitably caught up with apple (very easy when the direction is set out for you). At this point you'd expect sales growth to flatten.
Google glass is innovative and has the potential to be category defining, but who's to say apple doesn't have something up their sleeve which is as interesting? Openness isn't part of their product development approach and unless they're ramping up production they can probably keep leaks under control...