Tim Cook on iPhone XS: People Want the Most Innovative Phone Possible and 'It's Not Cheap to Do That'

[Woodcrest64]

Just my point of view, but what is irksome about Apple here is how Cook tried to justify the cost of the iPhone because it has a camera, music player, etc., as if this year's iPhones are the first to incorporate these things and how he said Apple's aim is to "serve everyone." Either be honest and say that you want to make as much money as possible or don't say anything.

He's not really being upfront like you mentioned. The iPhone's success its own issue. He wants to keep his investors happy so keep making money where people aren't upgrading as frequently, the only way to get around that is to charge more $$$ per phone.

I firmly believe the XR will greatly outsell the XS and XS Max but a long shot. That, and the Watch Series 4 I'm guessing will be another record year for Apple in terms of profits.

Historically in the past the iPhone at launch for pre-orders has sold out and shipping dates have really slipped. But many people have reported the day after the pre-order launch date, you could still order a XS/XS Max and not see really any delay in shipping. That says something there compared to years prior.

 

[Digital Dude]

Has anyone else noticed how Crook prefers late night and early morning entertainment shows instead of tech shows? Telling, ain't it...

None of the current high staff likes

People want the most innovative computer too.
Or even a computer as innovative as a ten year old MBP.
What’s the excuse there?

Removing all the features is not innovation.

In my opinion, Apple wants desperately to get out of the 'computer' business. I have the last two MBP's, and they are the worst value computers I have ever purchased. My next computer will be anything but a Mac. I have tried my best to adapt to Apple's one I/O interface, but I can't tell how frustrating it is to find myself out of town and discover I left one of the required dongles at home.

I've been using windows-10 lately, and with latest updates, it isn't all that bad. Not macOS easy, but close enough, and at half the price. As for hardware quality, Apple gave up on that top-spot a few years ago.

 

[apolloa]

“He pointed out that all of the technology included in the iPhone, replacing previous separate gadgets like MP3 players and digital cameras, requires each smartphone to be priced at a premium”

Arrogant excuse if I did ever hear one! Using this logic the iPhone is the same as a £100 phone! Yet costs 11 times the price...

 

[0958400]

Tim, by all means, do you really think that consumers will be brainwashed by your comments.
State it clearly: the iPhone is great product and we intent to make the most profit out of it.
Anything else is a lie and people do not appreciate being lied to.

 

[bbednarz]

No?? so how come the Max cost $1450?

Did the max exist last year? How can they raise the price on an item that is brand new? Also it is $1100, but of course look at the most expensive one to fit the narrative.

 

[deeddawg]

Historically in the past the iPhone at launch for pre-orders has sold out and shipping dates have really slipped. But many people have reported the day after the pre-order launch date, you could still order a XS/XS Max and not see really any delay in shipping. That says something there compared to years prior.

Just to play Devil's Advocate -- seems that says one of two things:

1. Apple got the production lines started early and with enough volume to build up sufficient stock to satisfy early demand without making people wait a long time.
2. Apple didn't sell as many preorder units this year as last year.

The trick is -- how do you know which it is?

 

[citysnaps]

It's Not Cheap to Do That... without losing a lot of profits

Why should Apple lose profits? That would be insane.

 

[brofkand]

Just to play Devil's Advocate -- seems that says one of two things:

1. Apple got the production lines started early and with enough volume to build up sufficient stock to satisfy early demand without making people wait a long time.
2. Apple didn't sell as many preorder units this year as last year.

The trick is -- how do you know which it is?

Nobody knows until their next quarterly report.

 

[Quu]

Back to my original question which you didn't answer -- which carrier charges interest on their phone payment plans?

Also - which carriers are doing 36 or 48 month payment plans?

Or are you just making this up as you go?
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Please point me to the 2017 large-format iphone X that had 512GB of storage.

I can't seem to find it.

Firstly I never said carriers add interest to plans, that's your poor reading comprehension and assumptions.

If you buy the iPhone from Apple directly with their payment plans on their own website (offered through PayPal and Barclays Bank in the UK) you pay 17.6% interest per year that you take the payment plan and they offer up-to 36 months.

You only get it interest free if you pay it off within 12 months which makes the repayment plan almost £100 a month.

When you get the phone through a carrier you're paying for the phone separately to your contract plan which is where they make their profit. But those deals are so expensive, you'll be paying so much per month it's not even worth entertaining.

This is how people get into debt, they want the latest shiny but they don't have the money so they go on these ridiculous plans. In the UK a lot of these plans are over £70 a month (which includes the phone and a very low end carrier contract) over 24+ months.

Tims statement that you can get a $1099 phone for just $30 a month is just incorrect if you don't include a substantial money down payment. Even the AT&T thing you linked to is over a 30 month period and the monthly plan is $37 a month.

Tim said people want innovation, who in their right mind is going to get that phone on a 30 month plan when they want the latest innovations? - It doesn't make any sense, you either care about the latest and greatest and upgrade every 12-24 months or you don't and go for a 30 month plan and buy a cheaper phone to begin with because you don't need the latest.

 

[Swift]

Sounds like Tim is on a PR tour to try and justify their profit margins...
I've ordered a XS Max but damn, the prices are outa control.

The 64GB Max costs $150 more than last year's X. Yes, you can buy a 512 GB phone, though very few will.

 

[deeddawg]

Firstly I never said carriers add interest to plans, that's your poor reading comprehension and assumptions.

If you buy the iPhone from Apple directly with their payment plans on their own website (offered through PayPal and Barclays Bank in the UK) you pay 17.6% interest per year that you take the payment plan and they offer up-to 36 months.

When you get the phone through a carrier you're paying for the phone separately to your contract plan which is where they make their profit. But those deals are so expensive, you'll be paying so much per month it's not even worth entertaining.

Thanks for clarifying. It was not apparent that you were in the UK. There is (virtually) no reason anyone here in the US would use a credit-card type financing for a cellphone, so it didn't occur to me that was what you were talking about.

In the US, the major carriers all offer no-interest financing with no penalities for early payoff. Literally it costs you no more out of pocket to pay for the phone over 24 or 30 months than it does to pay for it all at once up front. Take the phone price and divide by 24 -- that's your payment per month for 24 months. You're also free to leave the carrier any time you wish, the only thing is you need to plan ahead enough to allow a couple weeks time to pay off your phone and get it unlocked.

Apple has their no-interest payment plan but it force-bundles AppleCare+ so that throws off the numbers.

This is how people get into debt, they want the latest shiny but they don't have the money so they go on these ridiculous plans.

Agreed - paying credit card interest fees for a luxury phone is stupid.

Tim said people want innovation, who in their right mind is going to get that phone on a 30 month plan when they want the latest innovations? - It doesn't make any sense, you either care about the latest and greatest and upgrade every 12-24 months or you don't and go for a 30 month plan and buy a cheaper phone to begin with because you don't need the latest.

FWIW the carrier finance plans typically allow for trading in your phone in lieu of payoff at the 12 and 24 month intervals -- the AT&T 24-month plan lets you trade in your phone after one year and start a new Next plan (no carryover balance). The 30 month plan lets your trade in at 24 months. See https://www.att.com/plans/next.html

As for the postpaid service plans, there are no contracts. You can leave the carrier any time you want. The only catch is you need to pay off your phone before they'll unlock it for you -- but as stated that only takes a few days and is thus easily addressed if you plan ahead a little bit. (and have the cash to pay it off, but that's for another discussion)

 

[Swift]

Firstly I never said carriers add interest to plans, that's your poor reading comprehension and assumptions.

If you buy the iPhone from Apple directly with their payment plans on their own website (offered through PayPal and Barclays Bank in the UK) you pay 17.6% interest per year that you take the payment plan and they offer up-to 36 months.

You only get it interest free if you pay it off within 12 months which makes the repayment plan almost £100 a month.

When you get the phone through a carrier you're paying for the phone separately to your contract plan which is where they make their profit. But those deals are so expensive, you'll be paying so much per month it's not even worth entertaining.

This is how people get into debt, they want the latest shiny but they don't have the money so they go on these ridiculous plans. In the UK a lot of these plans are over £70 a month (which includes the phone and a very low end carrier contract) over 24+ months.

Tims statement that you can get a $1099 phone for just $30 a month is just incorrect if you don't include a substantial money down payment. Even the AT&T thing you linked to is over a 30 month period and the monthly plan is $37 a month.

Tim said people want innovation, who in their right mind is going to get that phone on a 30 month plan when they want the latest innovations? - It doesn't make any sense, you either care about the latest and greatest and upgrade every 12-24 months or you don't and go for a 30 month plan and buy a cheaper phone to begin with because you don't need the latest.

I pay $30 a month for the X, and another 5 or 6 dollars for AppleCare. It isn't my phone, of course. It's a lease. I have to keep it for a year, but then I can upgrade to next year's. (Probably a little money deposited to do that. About $250?) If I keep it for two years, it's mine. Then I can sell it, and it's holding its value quite well.

 

[CarlJ]

I don't think it's "the most innovative phone" if it's exactly the same as the last one.

Do you know what the phrase "exactly the same" means? I don't think you do.

 

[deeddawg]

I pay $30 a month for the X, and another 5 or 6 dollars for AppleCare. It isn't my phone, of course. It's a lease. I have to keep it for a year, but then I can upgrade to next year's. (Probably a little money deposited to do that. About $250?) If I keep it for two years, it's mine. Then I can sell it, and it's holding its value quite well.

Which carrier is doing this? Is that the AUP? I haven't looked into it deeply so plead ignorance if that's what it is.

 

[Swift]

Every year, the same argle-bargle about the huge cost, neglecting the fact that the luxury phones are all in the same area. But if you keep something for two years, or more, and you have the money, what exactly is the damage? Now, if we had just stuck with those black phones with the dial from AT&T, we could pick those up for.... well, they're collector's items now.
[doublepost=1537300987][/doublepost]

Which carrier is doing this? Is that the AUP? I haven't looked into it deeply so plead ignorance if that's what it is.

This is the American phone company, T-mobile. Used to be Deutsche Telekom. The pretty-close-to-really-unlimited plan is $70 a month. Plus, $30 for the X. If I ever get my second line sold, I'd be paying close to $70 for all of it.

 

[Niklas_nick]

It's bold to call the phones the "most innovative", especially in a year where updates are incremental and every reviewer says don't upgrade if you have the previous generation. Not even the previous generation, the iPhone X I have boasts of innovation. Most refined, I'll give you that. A clean design and solid quality, sure. But it doesn't offer any truly innovative, disruptive features, it's just a very well crafted device with competitive specs and a focus on design.

The ever-repeated phrases like "innovative", "amazing", "best" have become hollow and - especially coming from Tim on stage - cringeworthy.

Oh and btw regarding the pricing discussion, my X 64GB was $1350 in Germany, the new XS Max 512 is close to $2000. While European and American pricing was comparable factoring in sales tax 10 years ago (with the same mandated warranty etc. btw) it has grown more and more apart in recent years.

 

[diego]

$1 a day

Marketing 101 -the new Level-

in all fairness this is something Steve Jobs would have said...

 

[clangers23]

Well at least I now understand why they have to charge $1000+ and can't include a fast charger. They're really struggling to make a profit.

 

[ThunderSkunk]

”And so we do that in terms of creating jobs, we've created 2 million jobs in America. We want to create even more, we're investing $350 billion in the country over the next five years and we're starting up facilities in a number of different places. We're really proud of that contrib”

I think I’ll use this defense when the IRS comes kicking in my door. Well I would pay my taxes, see, but I do that in terms of hiring kids to mow my lawn, and buying tools from Home Depot, which I use to add value to the world, so I’m really proud of my contribution... lol I’m sure they’ll understand.

How nice it would be to afford to only fund the parts of the country I want to. Parts that make me monayyy!

 

[clangers23]

I think I’ll use this defense when the IRS comes kicking in my door. Well I would pay my taxes, see, but I do that in terms of hiring kids to mow my lawn, and buying tools from Home Depot, which I use to add value to the world, so I’m really proud of my contribution... lol I’m sure they’ll understand.

How nice it would be to afford to only fund the parts of the country I want to. Parts that help me make monayyy!

Tim's been making the argument that Apple should be excluded from paying tax because they're Apple for quite some time now. Apparently the normal business function of creating wealth and employment is unique to Apple.

 

[balaplus]

At the end of the day, there are 750 million iPhone users.
Even a third of them updating (every 3years) gives a sales number of of > 250 mil. You just sit on the user base and progressively increase margin per phone...that is a ton of money ....

 

[nezr]

$1 a day

Marketing 101 -the new Level-

hahaha....and sales 101. "its only $1 a day!"

 

[blacktape242]

good grief, im tired of this guy....

 

[brofkand]

At the end of the day, there are 750 million iPhone users.
Even a third of them updating (every 3years) gives a sales number of of > 250 mil. You just sit on the user base and progressively increase margin per phone...that is a ton of money ....

That was Apple's plan in the 90's too...and then users started leaving.

In fact, Apple's business model today is a lot like their 90's business model. Make the new stuff so expensive that fewer people can afford it. The affordable stuff is 2+ year old technology. Users can choose between Apple's 2 year old technology, or current technology from other makers for the same price or less. Make so many models with confusing names that nobody can figure out the product line. The only thing they're missing from the 90's is Sears-specific model numbers.

 

[Swift]

I just checked it out. The 64 GB iPhone X was $999. So is the XS. The XS Max is... ooh... $1099. That’s $100 more! When I can get it in spring, I’m trading my X in for an XS Max.
[doublepost=1537304500][/doublepost]

That was Apple's plan in the 90's too...and then users started leaving.

Ah, the “Walkaway” theory of cellphones. Actually, it got competition from Android a long time ago. Samsung makes money. Obviously Google makes a ton on ads. When they build their own luxury phone, what do they cost? Can you phone up a Google store and take one in if it’s broke? Now Google is good about security updates. How often are the cheaper ones updated? Either months later, or never. Well, that’s what you pay for.