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Tim Cook Says iPhone Activations Set New Christmas Day Records in United States and Canada
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That’s the point. Not everyone IS buying it at that price. Apple is now seeing that - especially in other markets
Not necessarily the right answer. Seems the US was just fine with pricing. China slowed down and it's a huge market for Apple.
This is why business is hatd, particularly on a global scale. Apple did well on many markets, but miscalculated China.
Looking at the data, Apple's businesses are strong to quite strong. They just need an iPhone strategy in struggling areas.
The struggle doesn't appear to be with the product itself, rather just with an economic slowdown.
Per Tim’s memo to employees:
it sure seems like this is mostly a China problem but people want to attribute it to whatever gripe they hav about Apple. Of course it being mostly a China problem shouldn’t be brushed off either. If Apple is not growing in China that’s a huge problem. The question is, is there a fundamental problem with China (economy slowing down, less consumer loyalty to a specific brand) or is it the current trade issues between China/US or a combination of both?
Tim, stop saying “these are without a doubt the best iPhones we’ve ever made.” We sincerely hope you would not be charging $1000+ for phones that were worse than last years. 
Wow, this is a load of BS. Apple has huge margins on all their products, far higher than most companies.
For no reason whatsoever, other than to counter falling sales, Apple bumped the prices on most of their products. Just look at the cost of the Apple Pencil or the Mac Mini.
Good points, but I don’t think it does Apple any good to put out a letter like this and not be completely upfront. Though I do agree with John Gruber that Cook’s letter was too long and didn’t really have a narrative. He’s right when he says Steve Jobs was better at delivering bad news than Tim Cook is.
New little trick from the ‘Cook book’: Continue producing record-breaking headlines by recooking the truth a little.
Record amount of iPhone activations this Christmas!!*
*on dec 24th between 4:27am and 4:29am
Record amount of iPhone activations this Christmas!!*
*on dec 24th between 4:27am and 4:29am
Yes, that's exactly what's happening. People don't like it and aren't buying it. That's why Apple is suffering. Apple should fix it by offering products at reasonable prices. I don't believe Apple's expense per phone has gone way up, but if it has, it's because Apple is throwing a bunch of totally unnecessary hardware in.
Where's the iPhone Mini? The iPod Mini and iPad Mini each came within 2-3 years of the initial version. We're 12 years into the iPhone and all we have is the base price just going up and then an even more insane one above it.
Apple has matured into a commodity company. Growth will remain in the single digits unless they can come up with a new "must have" device. You had the iMac, iPod, the iPhone, and the iPad (all released about five years apart) that drove Apple's growth for the last two decades. There was one last gasp as Apple finally capitulated to the demand for a bigger phone and released the 6 and 6 Plus in 2014. Sales have been stagnant ever since. Yes, the X gave a revenue boost, but the market for a $1,000 phone is very limited and demand was satiated relatively quickly with supply/demand catching up in mid-December of last year.
Apple is still a good company, but investors have been assuming the next great thing is right around the corner and 20% revenue growth would continue unabated. Maybe they've got something up their sleeve and we'll see something revolutionary in the next couple of years. Until then Apple needs to focus on iOS to ensure their users have the most capable devices that work reliably. Apple has a good user base that will generate cash flow for many years as long as they don't screw something up.
Apple is still a good company, but investors have been assuming the next great thing is right around the corner and 20% revenue growth would continue unabated. Maybe they've got something up their sleeve and we'll see something revolutionary in the next couple of years. Until then Apple needs to focus on iOS to ensure their users have the most capable devices that work reliably. Apple has a good user base that will generate cash flow for many years as long as they don't screw something up.
For those claiming Apple will continue pushing pricing up on iPhone, I would be shocked. First of all, if you think they’ve sold millions of less phones now than they anticipated, wait until they increase the cost of the iPhone further. It won’t just be China not buying. This is also why I believe the XR will continue to be the best selling iPhone. Even if it is not performing as well as Apple thought, it’s still outselling the XS models.
What happened to #2?
Also, the best year that Apple ever had for iPhone unit sales was 2014. The year that Apple released the 6 and 6 plus. The 6/6+ was also the first iPhone to have the bulge, so half of #6 doesn't work. Also, the 6+ is physically the largest iPhone, so #4 doesn't work either. The others are just opinions.
Don't get me wrong, I would have still bought the iPhone Xs at the current price if I didn't already have the iPhone X. But if the price was slightly lower I would have bought the Xs regardless of having the X and I think that is one of the differences compared to previous years.
It's not that I can't afford to pay Apple prices for their latest phone, it's just the feeling that me as a loyal Apple customer am being milked for all I am worth. I am sure they would have recouped their R&D costs for developing FaceID from the unit sales of the iPhone X. They have also utilised FaceID into the new iPad's thus bringing down the per unit cost of FaceID.
For me the incremental update to the processor and slightly faster FaceID does not justify the price of the iPhone Xs to be the same as the iPhone X.
On your other point, I think they have also miscalculated India.
Honestly I think acknowledging that the market is mature, the buying habits are changing, and focusing on expanding trade-ins and starting offering monthly payments is the right strategy.
Of course people says the solution is slash prices, who doesn't want to buy the same product for a lower price, but if it was their company or their money I sincerely doubt they would take their own advice
Of course people says the solution is slash prices, who doesn't want to buy the same product for a lower price, but if it was their company or their money I sincerely doubt they would take their own advice
I don't feel the price in of itself is the problem. Its that Apple is keeping older flagship models in the lineup in the way they are which forces the 2nd hand market lower than it would otherwise be. If I were to buy a new iPhone Xr in July for 859€ (I have to pay sales tax @ 21%) within 14 month that purchased will be worth less than 200€ because it'll be priced in comparison to what Apple still sells it rather than say being 50% of what it was bought at.
This raises the cost of an upgrade by a considerable margin… a margin the individual needs to find on a constant cyclic basis.
Add to that the business with the batteries. There's not a single other manufacturer on the planet that has performance issues as a battery degrades. Like the batteries bursting into flames was a Samsung only problem, this performance issue is solely an Apple problem. Its my impression that it has left a worse after-taste than Apple could ever imagine.
Furthermore, Apple not competing in the mid to upper-mid range is in my opinion a bad move. This is different to simply throwing last year's flagship, or even the year before's, into that price point… actually having a new model in that space. I switched to Android earlier this year from an iPhone SE (been using iPhone since the iPhone 3G - earlier models weren't available in my country) and consider the choice that was presented to me. My requirement are simple… 2 SIM cards, 128GB storage (for my music library mostly) and an OLED display.
iPhone Xs 256GB at 1,329€ is the only thing Apple can offer me. Also bear in mind that my cellular operator doesn't support eSIM so the Xs isn't actually a dual SIM phone for me. What I bought instead was a Samsung Galaxy A8 for 285€ (this included a new 128GB SD card). There is a whopping 1,044€ difference. A difference that I drove 8TB of SSD storage through (I bought 2 x 4TB Samsung 860 EVOs on sale from Amazon for 1,099€).
Sure they are significantly different phones but the both ring the same, they'll play Apple Music the same, will show me Youtube videos the same, gives me my email calendars, reminders etc the same (from OS X Server and not Google before you mention that), and WhatsApp annoys the s&%# out of me all the same. Where's the big gain for that price difference? And this is only thinking about this one purchase… not successive ones.
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I didn't… and because of that my next tablet probably won't be an iPad either.
I'm in one of the countries -not mentioned- for growth. iPhones can get up to $2500. I have a 6Plus that I'm desperate to update, but my screen is brighter and wider than all the new phones. Longer screen is no good to me, I show photos on my phone, they only take up half the long screened new phones, and the image is physically larger on my current phone!!
None of the new phones appeal. They're thicker, heavier, what's displayed is physically smaller, and the screens are not as bright. And did I mention, the price is through the stratosphere?
Apple has done everything possible to discourage upgrades, yet they seem amazed that -for another year- loyal customers aren't replacing their old phones. People are holding on to old phones because there's not much tangible improvement except speed, and all these downsides.
Let's talk XR specifically. The echo chamber is that the screen is OK, and compared to to XS and max, it's just as dull, so not appreciably worse, until you put on your glasses and actually look at the picture quality.
The XR screen is larger in square inches than my 4 year old 6Plus, but has LESS pixels in that display. Liquid Retina is a warning label to me! I fear for the iPad Pros for this reason. I don't need wireless charging, a glass back, or even faceID. Let my Watch unlock the phone or give me the passcode in a cheaper model. I do need a better screen and the wrong tradeoffs have been made here. Add to that the XR is the same price my phone was when it was the top of the line, and NOBODY is going to look at XR unless it's a forced upgrade (broken or lost phone).
Make a compelling product, customers will upgrade. Stop rearranging the deckchairs, Tim.
None of the new phones appeal. They're thicker, heavier, what's displayed is physically smaller, and the screens are not as bright. And did I mention, the price is through the stratosphere?
Apple has done everything possible to discourage upgrades, yet they seem amazed that -for another year- loyal customers aren't replacing their old phones. People are holding on to old phones because there's not much tangible improvement except speed, and all these downsides.
Let's talk XR specifically. The echo chamber is that the screen is OK, and compared to to XS and max, it's just as dull, so not appreciably worse, until you put on your glasses and actually look at the picture quality.
The XR screen is larger in square inches than my 4 year old 6Plus, but has LESS pixels in that display. Liquid Retina is a warning label to me! I fear for the iPad Pros for this reason. I don't need wireless charging, a glass back, or even faceID. Let my Watch unlock the phone or give me the passcode in a cheaper model. I do need a better screen and the wrong tradeoffs have been made here. Add to that the XR is the same price my phone was when it was the top of the line, and NOBODY is going to look at XR unless it's a forced upgrade (broken or lost phone).
Make a compelling product, customers will upgrade. Stop rearranging the deckchairs, Tim.
Market saturation is mostly the issue, and there isn’t a dire need to upgrade. There is a lot of people still with 5s And 6, which got big performance gains in iOS 12. The 6s is still a great phone today.
Evantually they need to get people off those phones and stop supporting them in the next iOS. No one would complain since they did a lot of goodwill after batterygate and how successful iOS 12 was.
If they innovate more on the 11 and push big in iOS 13 people will pay the asking price.
Evantually they need to get people off those phones and stop supporting them in the next iOS. No one would complain since they did a lot of goodwill after batterygate and how successful iOS 12 was.
If they innovate more on the 11 and push big in iOS 13 people will pay the asking price.
Don't you see an issue with your statement? If people continue to not buying iPhones, Apple's revenue and profits will continue to fall.
It's a problem that Apple should fix so people start buying their phones again.
It's not a consumer problem. It is an Apple problem.
Actually Samsung throttles phones all the time, UNLESS a benchmark is running, then they run wide-open. Samsung says this is for reasons of battery life. Apple only throttles when the battery degrades. Apple is way ahead here. The issue is poor choice of battery. It's not actually up to the job, and still Apple is way ahead.
This "issue" with the the Chinese market can be summed up in one word, Huawei. In China, even though that is where most iPhone models are manufactured, the iPhone is not viewed as a Chinese product. Huawei is. There is a strong nationalist feeling among many Chinese consumers that to own and iPhone is anti-Chinese. There are Chinese companies that have actually threatened to fire employees who have iPhones rather than Huawei phones. And the arrest recently of the Huawei CEO while visiting Canada has not exactly been well received by the Chinese public.
Li-ion battery technology hasn’t really advanced in the past decade, it’s not the choice of battery.