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I don't understand what you are trying to say other than you like when companies lower their prices. Your point is not actually economically true. Companies charge what they can get. Not a formulaic proportion of unit sales. You have it backwards. You take those things into consideration (unit sales, cheap software because you don't develop it yourself you license it from Google ETC) but no company charges less then they can get. These phone companies are trying to use saturation and price techniques to compete almost always in markets where there is demand for cheaper products. They charge, not out of an altruistic calling, but what they think they can get to try and build market share. If they are Chinese they are already being supported by the national government. Same with Korean companies. Don't forget that aspect.
You're misunderstanding the economics. Most businesses entering a market charge less than cuatomers' marginal willingness to pay as a means of attracting customers, either with the goal of retaining a large share when they eventually raise prices (this is the "traditional" model) or with the expectation that technology will advance in a way that will allow them to maintain their low price and reduce costs to increase profit. Amazon and their "flywheel" is an example of this--they are betting that tech will reduce their delivery costs to the point that they can turn significant profit and current relatively profitless prices.

What this whole discussion misses is that phones have become a commodity, with the differences between iOS and Android shrinking to virtually nothing--same could be said for Windows and MacOS. Users increasingly live in the browser or unified UI apps and the physical engineering is arguably better now from some of these Chinese makers. As such, for how long will Apple be able to convince large chunks of western (increasingly just US) consumers to pay a large premium for an undifferentiated product? It's not like a luxury car that survives as visible status symbol (and even that mindset is mostly dead among gen z). I personally see it as hangover effects--just like it took consumers a decade or two to transition from US auto brands to foreign in the 1970s, with the old and ignorant making jokes about Japanese quality at exactly the moment they were being ripped off for overpriced big-3 autos.
 
I don't think Apple really cares since Apple dominates in premium phone category by wide margin.
 
So...what did Xiaomi do that made its sales spike 83%?
For starters they've been opening up craploads of Apple-like stores all over Asia.

They also have a crazy number of non-computing, arguably best-in-class, devices. They've got people comfortable with the reliability of the brand over the past number of years.

If I was in the market for a non-Apple smartphone a Xiaomi would be on my shortlist for sure. I'm not surprised whatsoever they've done so well. Huawei are simply not looked on so favorably after all the recent controversies the past couple of years.
 
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Sold more phones in China. When from 13% to 15% market share in China. The article did mention that they increased sales outside of China as well, especially in nations where people place a good bargain over prestige. Apple's modest market share in the Chinese market accounts for 20% of Apple's iPhone sales. Is it any wonder Timmy is hell bent to doing better in China?

Finally, someone who speaks sense. Too many people here care too much about impressing others rather than using what works well, because it works well.

Actually I am glad Apple is losing. Its in the best interest of everyone that no 1 company becomes dominant, plus there is enough profit and market share for everybody. Even if we had like 10 companies each with 10% market share which equals $1B a year...thats still a ludicrous amount of profit!

For starters they've been opening up craploads of Apple-like stores all over Asia.

They also have a crazy number of non-computing, arguably best-in-class, devices. They've got people comfortable with the reliability of the brand over the past number of years.

If I was in the market for a non-Apple smartphone a Xiaomi would be on my shortlist for sure. I'm not surprised whatsoever they've done so well. Huawei are simply not looked on so favorably after all the recent controversies the past couple of years.

Are you saying that Xiaomi products are reliable? As in like "Made in Japan" reliable? that will interest me into becoming a customer.
 
I really wish people would stop saying Apple doesn’t care, yes, they do 🙄🙄🙄

Meant as they don't care about Xiaomi overtaking them on raw number of units sold, when Apple enjoys highest profit margin compared to any other smartphone company in the world.
 
Are you saying that Xiaomi products are reliable? As in like "Made in Japan" reliable? that will interest me into becoming a customer.
I would say 100% "yes".

I've had nothing but good experiences with all my Xiaomi devices. My air purifier has been on 24/7 for the past 6 years, the smart bands still work fine but outdated after 4 years. Xiaomi's electric scooters have been the #1 selling the past couple of years for good reason.

A buddy of mine has his house set up as a smart home with everything from his Cookers, coffee maker, locks, Aircon, LED lighting systems, repeaters and CCTV running Mi Home for years without any issues.

Reliability has been on-par or better with any other top tier company. Their stuff is mostly not "cheap" ... just a little "cheaper" in some cases and on-par or even more expensive on occasions. e.g. their MacBook Pro rival and gaming Laptops are not cheap.

Also, not everything is designed by Xiaomi in-house, they are a company that acquires really good tech and they don't sell everything under the Xiaomi Name e.g. Nextool, Miija, sMate etc ....

IMHO are genuinely the only Chinese company that pays proper attention to detail on everything from the packaging to the customer service, to the eco-system.

 
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Who wants to compete with Android? Anybody starting a new smartphone OS will face a challenge of zero apps vs the mature Google Play Store. Microsoft failed, Blackberry failed, Palm failed. It's been done, and the market simply chose to stick with mature platforms.

Want somebody to blame? Blame Google for giving out Android for free. Basically no OEM will want to spend the money for a competing OS when the cost of adopting Android is zero. Samsung tried with Tizen, and it didn't work. None of the OEMs have competency in software. Apple is in a unique position in that they are both software and hardware company.
I understand the view on the situation from a company’s standpoint and how it came to be. But from a users view this leaves me with zero alternatives to Apple’s OS since android is a system I would never use and that is really all there is left. And that is ultimately thanks to the majority of users who didn’t give a thing about OS diversity.
 
Who wants to compete with Android? Anybody starting a new smartphone OS will face a challenge of zero apps vs the mature Google Play Store. Microsoft failed, Blackberry failed, Palm failed. It's been done, and the market simply chose to stick with mature platforms.

Want somebody to blame? Blame Google for giving out Android for free. Basically no OEM will want to spend the money for a competing OS when the cost of adopting Android is zero. Samsung tried with Tizen, and it didn't work. None of the OEMs have competency in software. Apple is in a unique position in that they are both software and hardware company.

I understand the view on the situation from a company’s standpoint and how it came to be. But from a users view this leaves me with zero alternatives to Apple’s OS since android is a system I would never use and that is really all there is left. And that is ultimately thanks to the majority of users who didn’t give a thing about OS diversity.

This is a flaw in the capitalist system, people with money will not seek to profit from competing withe stablished companies thus leading a monopoly/oligopoly state. You can see it everywhere like in telecom, movie studios, 80% of USA Beef Comes From 4 Producers ... etc basically they are too coward to take this kind of risk.

Although this is not completely correct, in India a billionare was upset with the telecom opened his own called Jio and Indians seem to be happy with this. Steve Jobs didn't like the state of the cellphones so he took the challenge against the giant that was Nokia. I believe somehwere in the 50's-70's people were laughing at the Japanese car companies against the giant American ones, well we have Toyota today.

OEMs like Samsung, Sony, LG, etc are multi-billion dollar companies that have all the money to bring new OS to the market they are just either too scared to take the risk or too stupid to build a reliable one. Heck, they can join together into a consrotium and build a new competing OS. Huaewi is kind of doing this already with Harmony .
 
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I would say 100% "yes".

I've had nothing but good experiences with all my Xiaomi devices. My air purifier has been on 24/7 for the past 6 years, the smart bands still work fine but outdated after 4 years. Xiaomi's electric scooters have been the #1 selling the past couple of years for good reason.

A buddy of mine has his house set up as a smart home with everything from his Cookers, coffee maker, locks, Aircon, LED lighting systems, repeaters and CCTV running Mi Home for years without any issues.

Reliability has been on-par or better with any other top tier company. Their stuff is mostly not "cheap" ... just a little "cheaper" in some cases and on-par or even more expensive on occasions. e.g. their MacBook Pro rival and gaming Laptops are not cheap.

Also, not everything is designed by Xiaomi in-house, they are a company that acquires really good tech and they don't sell everything under the Xiaomi Name e.g. Nextool, Miija, sMate etc ....

IMHO are genuinely the only Chinese company that pays proper attention to detail on everything from the packaging to the customer service, to the eco-system.

Sounds like Xiaomi sales guy pitch. 🤣
 
until iphones come anywhere close to being the only phones you can buy, apple cannot be a monopoly in any meaningful sense of the word. your railroad analogy is garbage
Actually, I thought it was a really good analogy to the point you made that controlling something you built from the ground up can't be a monopoly. You are wrong about that. The railroads are a good historical example. You can make something and create a monopoly that it helps society to have laws in place that allow competition to come into the space. The iPhone would not exist in its current form if there were not laws in place that force a bunch of patent holders to license technology to Apple at a reasonable price. That is another example.
 
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I think that the US Antitrust investigators only care about the US market where Apple controls 50%.

Not true. The US Antitrust division is part of the Department of Justice and that is lead by a presidential appointment. It is a department with some significant political ties. Basically when there is a Republican President, enforcement of the anti-trust laws decrease and when there is a Democrat President, enforcement increases. Though in each case there is fairly modest enforcement of current laws. And judges have interpreted the laws in ways that are very favorable to companies that are trying to grow. This is often justified by the argument that the US needs large companies in order to compete internationally. And the division takes a very broad and international view.
 
I don’t think you understand what a monopoly legally is. According to you, Sony PlayStation, Microsoft X Box ~, Nintendo Switch, Walmart are monopolies.

These are all quasi-monopolies. In order to maintain pricing power with their customers, each console maker restricts access to software on their console. Since each of them does it, the customer basically only has a choice of which quasi-monopoly they wish to participate in or they can chose not to have a console. But in each case the software developer has to give a cut to the console maker in order to sell software for the console.

Walmart attempts to put all/most local stores out of business, giving it a local quasi-monopoly for the sale of goods. Not an illegal monopoly. However it is a super strong economic position to have to be the largest seller of goods in a town and also be the largest employer. The result has been vast wealth going to the Walmart family. Absent some sort of government intervention, there is no particular reason why this won't continue for decades to come. Nobody is ever going to build another competing super store right next to a Walmart and compete with it. And if someone did, Walmart would presumably cut their prices, run the store at a loss, until the competition was out of business. Or they might do other anti-competitive practices that are even shadier.
 
Actually, I thought it was a really good analogy to the point you made that controlling something you built from the ground up can't be a monopoly. You are wrong about that. The railroads are a good historical example. You can make something and create a monopoly that it helps society to have laws in place that allow competition to come into the space. The iPhone would not exist in its current form if there were not laws in place that force a bunch of patent holders to license technology to Apple at a reasonable price. That is another example.

RE: Railroads

Yes... I can see how if there is only one railroad line between towns... and one company controls all travel along that line... that the railroad is a monopoly.

But considering there are other phones besides iPhones (Android phones) doesn't that dispute the idea that the iPhone is a monopoly?
 
RE: Railroads

Yes... I can see how if there is only one railroad line between towns... and one company controls all travel along that line... that the railroad is a monopoly.

But considering there are other phones besides iPhones (Android phones) doesn't that dispute the idea that the iPhone is a monopoly?

Well with the railroads, that is exactly how it went down. One company controlled the railroad from the town to the city where the customers were. The counter was that the farmer trying to sell their stuff could always just load it into a truck and get to the customers that way. But the farmer was going to lose trying to play that game because railroads moved large amounts of good so much cheaper.

Under current laws the fact that there are many other phones is a huge defense against the position that Apple has a cellphone monopoly. That was my main point of the post was that Apple being just a fraction of the phones sold worldwide is very good for their anti-trust defenses.

But if you think about how embedded Apple's customers are in the ecosystem (and I'm very much one of those Apple guys who uses Apple products all the time and think they are great), you can make the argument that Apple gatekeeping before allowing any software to be loaded onto iOS and taking a cut of revenue that software developers earn is very "quasi-monopoly".

As a society, we can either allow the status queue to continue (perfectly justifiable decision: Apple does very well by its customers in my opinion and doesn't skim too much from software developers) or we can make laws and enforce them that force Apple to allow software on the iOS hardware without having to get Apple's approval or creates a competitor to the App Store (lots of good arguments for that as well: another App Store would probably take a smaller cut from software developers).
 
Well with the railroads, that is exactly how it went down. One company controlled the railroad from the town to the city where the customers were. The counter was that the farmer trying to sell their stuff could always just load it into a truck and get to the customers that way. But the farmer was going to lose trying to play that game because railroads moved large amounts of good so much cheaper.

Under current laws the fact that there are many other phones is a huge defense against the position that Apple has a cellphone monopoly. That was my main point of the post was that Apple being just a fraction of the phones sold worldwide is very good for their anti-trust defenses.

But if you think about how embedded Apple's customers are in the ecosystem (and I'm very much one of those Apple guys who uses Apple products all the time and think they are great), you can make the argument that Apple gatekeeping before allowing any software to be loaded onto iOS and taking a cut of revenue that software developers earn is very "quasi-monopoly".

As a society, we can either allow the status queue to continue (perfectly justifiable decision: Apple does very well by its customers in my opinion and doesn't skim too much from software developers) or we can make laws and enforce them that force Apple to allow software on the iOS hardware without having to get Apple's approval or creates a competitor to the App Store (lots of good arguments for that as well: another App Store would probably take a smaller cut from software developers).

Exactly.

So Apple doesn't have a monopoly on phones because there are definitely other phones you can buy instead. I don't see how Apple can be accused of controlling the smartphone market.

BUT... Apple does control the App Store on their phones... so developers must obey Apple's rules to be in that store. (or you don't get your apps on Apple's phones)

There's always talk about defining the market. All smartphones as a market... versus the App Store on iPhone as a market.

I always thought that the fact that everyone on the App Store follows the same rules... that you're competing with all the other apps on the App Store.

Your calendar app is up against all the other calendar apps on the App Store. There is competition within the App Store.

But it's sounding more and more like people want additional app stores on the iPhone... kinda like how Google allows.

And yet... 3rd-party app stores haven't exactly been a boon for Android. It's pretty much Google Play or nothing.

However... Google does allow sideloading... even though they try to scare people away from it. They're still getting sued... so who knows.

I don't know the solution to Apple's problems.

Do they simply lower their cut to make developers happy? Does Apple need 30 cents from every dollar that passes through the App Store... forever?

Do they need to allow "Jim's App Store" to compete with the official Apple App Store? And would you sell your calendar app in Jim's App Store because he charges a lower fee? And would it be worth your time to maintain two developer accounts?

Should they allow the big companies with their own payment processing to just handle their own transactions? Netflix, Microsoft, Spotify, Epic, etc?

On the Surface it seems silly to say "Apple has a monopoly on their own App Store"

Yet they keep getting sued for exactly that.

It'll be interesting to see how it all shakes out.

Look for a decision in about 2026

:p
 
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Sounds like Xiaomi sales guy pitch. 🤣
Yeah, I went on a rant haha ... I just appreciate when a company puts the extra effort in.

That said, when it comes to computers and phones I'll be sticking with Apple for the foreseeable future.
 
Exactly.

So Apple doesn't have a monopoly on phones because there are definitely other phones you can buy instead. I don't see how Apple can be accused of controlling the smartphone market.

BUT... Apple does control the App Store on their phones... so developers must obey Apple's rules to be in that store. (or you don't get your apps on Apple's phones)

There's always talk about defining the market. All smartphones as a market... versus the App Store on iPhone as a market.

I always thought that the fact that everyone on the App Store follows the same rules... that you're competing with all the other apps on the App Store.

Your calendar app is up against all the other calendar apps on the App Store. There is competition within the App Store.

But it's sounding more and more like people want additional app stores on the iPhone... kinda like how Google allows.

And yet... 3rd-party app stores haven't exactly been a boon for Android. It's pretty much Google Play or nothing.

However... Google does allow sideloading... even though they try to scare people away from it. They're still getting sued... so who knows.

I don't know the solution to Apple's problems.

Do they simply lower their cut to make developers happy? Does Apple need 30 cents from every dollar that passes through the App Store... forever?

Do they need to allow "Jim's App Store" to compete with the official Apple App Store? And would you sell your calendar app in Jim's App Store because he charges a lower fee? And would it be worth your time to maintain two developer accounts?

Should they allow the big companies with their own payment processing to just handle their own transactions? Netflix, Microsoft, Spotify, Epic, etc?

On the Surface it seems silly to say "Apple has a monopoly on their own App Store"

Yet they keep getting sued for exactly that.

It'll be interesting to see how it all shakes out.

Look for a decision in about 2026

:p

Yep, that is the issue. And Apple is probably realizing the App Store is drawing unwanted attention. There are also simple answers to some of your questions:

"Does Apple need 30 cents from every dollar that passes through the App Store... forever?"

Does the most profitable and most valuable public company in the world need 30 cents of ever dollar forever? Of course not. Does it basically want as much money as possible? Yes.

Basically Apple runs the App Store as something of a benevolent dictator. It is true that it is a great service for developers and iOS users.

But Apple taking a greater and greater cut of all software sale revenue year over year (more consumer level programing seems to go through the iOS App Store each year) probably has some bad unintended consequences. Politicians are getting wise to this and I'd say your joke guess of 2026 probably isn't far off unless Apple makes some pretty serious changes. Apple either solves this problem or the politicians are going to solve it in some crude and possibly bad for everyone way.
 
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"Does Apple need 30 cents from every dollar that passes through the App Store... forever?"

Does the most profitable and most valuable public company in the world need 30 cents of ever dollar forever? Of course not. Does it basically want as much money as possible? Yes.
The problem for Apple is that under Tim Cook, "services" have been positioned as the growth driver. That means the App Store. Before Tim started pushing services, Apple stock was basically flat for a few years when iPhone sales stopped growing. If Apple gives up their 30% cut, they lose their growth story and the stock price could be seriously hurt. That's the reason I think Apple is digging in their heels so hard over revenue they don't even need. That and their pride and desire for control, of course.
 
The problem for Apple is that under Tim Cook, "services" have been positioned as the growth driver. That means the App Store. Before Tim started pushing services, Apple stock was basically flat for a few years when iPhone sales stopped growing. If Apple gives up their 30% cut, they lose their growth story and the stock price could be seriously hurt. That's the reason I think Apple is digging in their heels so hard over revenue they don't even need. That and their pride and desire for control, of course.

Well you are absolutely right that the stock would take a hit. It is very hard to justify a 2.4 trillion dollar market cap. And the App Store profit growth is a huge part of justifying the current stock price. Much of Apple's senior work force gets large amounts of their compensation through stock grants (I'm not talking about the top five executives who are so rich at this point that money is basically meaningless to them). So Apple is very sensitive to stock price drops because it could lead to mass departures throughout the company.

However, I wouldn't say this is a Tim Cook problem versus a Steve Jobs problem unless you think that Jobs would have seen the opportunity for App Store profits and just walked away from it. Apple has always thought its stock was underpriced so they probably like that they can make a growth story that Wall Street buys into.

The pride point is very important though. It goes with my other statement that Apple sees itself as a benevolent dictator. Or perhaps a Philosopher King (Plato reference). This, from the point of the dictator or king, is the best structure because their pride says that they will rule in the best way possible so it doesn't matter how much power they have over their customers or software developers because Apple's view is they won't abuse this power.
 
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