“During its earnings call yesterday, Apple revealed that its quarterly revenue for fiscal 2019’s Q1 (which ended on December 29, 2018) was down by 5 percent compared to a year ago, at just over $84 billion,” Abhimanyu Ghoshal writes for TNW. “t also shed light on why that happened: people bought fewer iPhones.”
“The problem isn’t only about Apple charging a premium for its devices, but also its failure to adjust pricing for other markets. For reference, the iPhone XS Max starts at $1,110 for the 64GB variant in the US. In India, it will set you back by more than $1,500,” Ghoshal writes. “That’s set to change: CEO Tim Cook told Reuters this was a major issue particularly in countries whose currencies weakened as the US dollar got stronger, and so the company will tweak their pricing strategy for its flagship phones from here on out: ‘…as we’ve gotten into January and assessed the macroeconomic condition in some of those markets, we’ve decided to go back to more commensurate with what our local prices were a year ago in hopes of helping the sales in those areas.'”
“With that, Apple could have a chance to earn more from mobile device sales internationally this year,” Ghoshal writes. “But it remains to be seen what the smartphone market looks like by the time September – which is when the company unveils its iPhones each year – rolls around.”
Read more in the full article here.
MacDailyNews Take: The “S” year concept is self-defeating. Apple basically labels their flagship iPhones as “no big deal” every other year. Apple should have ditched their stupid “S” naming scheme many years ago. They never should have started it, in fact.
Apple already knows how to name them, via their MacBook lines. Name them like this:
• 4.7-inch iPhone (2019) (white, black, blue, yellow, coral, red)
• 5.8-inch iPhone (2019) (silver, space gray, gold)
• 6.5-inch iPhone (2019) (silver, space gray, gold, rose gold)Plus, every year should offer a unique color scheme that is not replicated for at least five years so the newest iPhones are readily identifiable. Pooh-pooh it all you want, but many people not only want the latest tech, but they want others to know that they have the latest tech. An unique “brushed copper” or whatever color option – anything that says “This Year’s iPhone” at a glance – would sell better than yet another bland “S” model, regardless of processor and camera upgrades. The fact is that vastly more people care more about being able to brandish the latest iPhone than what’s inside it. Call it superficial or whatever, but its what sells.
If Apple simply did as we’ve described above – name them right (not idiotically tagging them as incremental every other year) and offer a unique, identifiable look – they’d sell more iPhones, without changing prices a whit.
Instead, they’re stupidly naming them after “fast cars,” tagging them with the scarlet “S” and a random “R,” making their flagships (XS and XS Max) look the pretty much the same as last year (yes, Max is bigger, but an XS looks virtually identical to an X; it’s no surprise that the XS is outsold by the different looking XS Max and XR), creating confusion in the marketplace and reducing the impetus to upgrade.
SEE ALSO:
Apple SVP Phil Schiller’s disturbing confession – October 31, 2018
Phil Schiller talks iPhone Xr, Apple product naming, and much more – October 22, 2018
Apple’s inexplicably awful iPhone naming schemes – September 26, 2018
I missed the last 5% off Apple products sale. I’m so sad to have missed this great savings incentive. Life is tough when profit margins are small.
MDN IS CORRECT: There is no compelling reason to upgrade. Cook playing around with naming conventions is a smokescreen to take your eyes off the fact that he’s selling the same phone year after year, with minor tweaks.
Once Apple lowers their prices that’s it. They will have to continue that trend going forward, because their products are priced anywhere from 50 to 70% higher than they should be.
Next, Cook needs to stop marking up storage to astronomical levels. The competition offers expanded storage that makes Cook’s model look stale and ridiculous.
Finally, we all know this stock is going to tank soon. Their future looks bleak because there has been no excitement coming from Cupertino since they laid Jobs to rest.
The Keynotes are a joke, innovation at Apple is non-existent, the iPad has not changed and using the word “Pro” won’t magically make it a pro device, the Apple watch is a fashion accessory, Earpods are priced 70% higher than they should be, Apple Care increased in price under Cook by almost 400% and it now sucks, Macbooks are priced 60% higher than they should be, and the litany of issues under Tim Cook goes on and fucking on to infinity.
Oh STFU you troll
Local prices from a year ago?? You were still gouging us back then, Timmy. So what, the iPhone XI will be 1150 CAD instead of 1200 ? No thanks.
MDN, get over the S names its no big deal. Nothing wrong with naming based on sports cars either. Who really cares other than you? What does it change? Nothing. Its a model designation. Get over it.
BTW what does your entire rant about S’s and colors have to do with pricing outside the US ? Do you think any of that has any impact on sales and upgrade cycles?
The cell phone is pretty much a mature technology and market and we have reached the good enough point for many of the customers Apple is counting on.
Apple offset part of the decline by raising the average selling price, but that has obviously hit the point of demand destruction. Here and elsewhere I have been called a troll or was=rse for saying this very thing. Apple’s prices are too high and I say that typing on the new iPad Pro with an iPhone XS providing internet.
Services are not going to get it. If Tim thinks he can scratch my pocket monthly he is sorely mistaken. I own my home, my car, my mobile devices, my music, my movies and my software and am not interested in renting content.
Instead of throwing money at Rappers (Dre) and Hollywood producers, he might want to hire a few more security auditors. After all the hype of group FaceTime it gets shuts down for a massive security hole. Who was responsible for making sure a protocol connecting groups of people was secure? They should be cashiered and escorted off the campus.
This is Cook’s Apple personified totally reactive rather than the proactive company it used to be. If I had wanted this I would have have become a Windows user it would have at least been a quicker death by boredom than what we are suffering at the moment. It really is amazing how people in power can be quite so un-self aware, but Cook really is terrifically adept at the straight face while all around are laughing.
Anywhere outside the US, prices for Apple products are nothing short of a ripoff. In Australia the cost of Macs are disgraceful. It’s almost as bad as the 90s when it was cheaper to fly to Hawaii to buy a Mac than back in Oz. Crazy. iPhones are the same.
Greg Lane,
I’m from the land of Oz as well and the prices are such a joke that as far as our household is concerned we just can’t afford Apple products anymore.