“Apple released a new flagship iPhone yesterday, the iPhone XS. This isn’t exactly ground-breaking news: it is exactly what the company has done for eleven years now (matching the 11-year run of non-iOS iPods, by the way),” Ben Thompson writes for Stratechery. “”To that end, what has always interested me more are new-to-the-world non-flagship models: the iPhone 5C in 2013, the iPhone 8 last year, and the iPhone XR yesterday. Each, I think, highlights critical junctions not only in how Apple thinks about the iPhone strategically, but also about how Apple thinks about itself.”
“To be clear, the overall strategy and pricing of the iPhones XS and XR were planned out two to three years ago; that’s how long product cycles take when it comes to high-end smartphones,” Thompson writes. “Perhaps that is why the lessons of the iPhone 5C seem so readily apparent in the iPhone XR in particular.”
“The XR is a fantastic phone, one that would be more than sufficient to maintain Apple’s position atop the industry were it the flagship. And yet, in the context of Apple’s strategy, it is best thought of as being quite literally ahead of its time,” Thompson writes. “There is, of course, the question of cannibalism: if the XR is so great, why spend $250 more on an XS, or $350 more for the giant XS Max? …Apple’s best customers, not just those who buy an iPhone every year, but also those whose only two alternatives are “my current once-flagship iPhone” or “the new flagship iPhone” are motivated first-and-foremost by having the best; price is a secondary concern. That is why the iPhone X was the best-selling smartphone, and the iPhone 8 — which launched two months before the iPhone X — a footnote.”
Read more in the full article here.
MacDailyNews Take: If Apple has Apple-esque margins on iPhone XR, and there’s no reason why they wouldn’t, then Apple will be reporting record iPhone profits for several quarters to come.
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