Apple announced a mess of stuff yesterday but why talk about that when we can talk about the problems with announcements they haven’t made yet?
Writing for the lovely people and scarab beetles and ancient, unspoken terrors over at Business Insider, Jim Edwards describes “Apple’s ‘$1,000 iPhone’ problem.” (Tip o’ the antlers to Tibor Csapo.)
Would you believe it’s two words, rhymes with “brisket fair”? Once again Apple is pricing iPhones to gain profit share instead of market share. Why is this surprising after all these years? Serial obtuseness, probably. That seems like the only logical answer.
Kleiner Perkins Caufield & Byers analyst Mary Meeker delivered her legendary annual “state of the internet” report last week, and this chart within it describes Apple’s “$US1,000 iPhone” problem perfectly.
You might be wondering what Edwards is talking about on any number of levels here. You might also be wondering what poor life choices led us to reading this article. These are both valid questions. We’re only going to tackle the first one, though. Perhaps consult with your local clergy or therapist on the second. Suffice it to say, though, you should have gone to the brisket fair instead.
Let’s start at the beginning. Apple is rumored to be shipping an iPhone 8 this year, a next-generation phone packed with more updates than usual. Somehow this phone, which normally wouldn’t ship until 2018, will be “late” according to pundits because it will not ship in the September/October timeframe and they don’t understand that there are other months in the year.
Because it will be so advanced, it will reportedly come at an advanced price: $1,000. None of this is unreasonable until you realize that this is the only phone Apple will be shipping this year.
Oh, wait, that’s not true. Although you wouldn’t really know that from reading Business Insider since this piece never mentions the iPhone 7s which will, almost certainly, ship exactly when you’d expect. Instead the piece laments the oh-so-expensive iPhone 8.
…the entire market has stopped growing. So Apple must either take a greater share of the market—which it has never done before—or expand the market as a whole.
Sure, if market share is what you want. But if you’d rather have revenue and profit share, you can grow those by selling some of your customers an even more expensive phone. Business Insider, however, is unaware of these shares of which we speak. Which makes you wonder what business it is they’re inside of.
Can Apple take a greater share of the market when it wants $US1,000 for a phone?
Probably not much, no!
[sound of cash registers ringing furiously]
As my colleague Rob Price reported, Apple has launched an ad campaign to persuade Android users to drop the world’s favorite operating system.
There are undoubtedly many who prefer Android, but when its key feature is running on really cheap phones, calling it “the world’s favorite operating system” is a little like calling water the world’s favorite beverage.
But “kinda true and kinda not true” is basically Business Insider’s beat.