Apple’s services are largely software — and software sells systems

“In yesterday’s FQ2 2019 earnings conference call, the word ‘services’ was stated 26 times, compared to just 17 mentions of ‘iPhone’ and ten of ‘Mac,'” Daniel Eran Dilger writes for Roughly Drafted. “Cook spoke of Services as if they were an entirely new category of thing, stating that ‘they actually help to eliminate the boundary between hardware, software, and service, creating a singularly exceptional experience for our users.'”

“That’s some rather creative wording, but the reality is that the Services Cook was describing are effectively software, valuable applications for the hardware products Apple sells,” Dilger writes. “That’s important because it helps to clarify that Services is not really some uncharted new territory for Apple where we’re waiting to understand how things might work, but rather a quite well-known subject.”

“Apple is developing new Services — including Apple TV+ — to earn ongoing subscription revenue,” Dilger writes. “But it’s pretty clear that Apple TV+ is less like Netflix and more like iTunes: a business that’s designed not just to sell access to content, but to produce original content that is tightly linked to Apple’s platforms in a way that helps to sell Apple hardware.”

Read more in the full article here.

MacDailyNews Take: You know which one of Apple’s new platforms is going to really help sell Apple hardware? Apple Arcade.

Apple Arcade only requires one hit that’s exclusive for a long enough period that it makes gamers without an Apple device strongly consider that factor when choosing their next personal computer, smartphone, tablet, or set-top box. Then, of course, once they get one Apple device, the light finally comes on and we all know what happens next! 🙂 — MacDailyNews, April 15, 2019

SEE ALSO:
Apple Arcade could have a big league pay off – April 18, 2019
Apple’s most important new subscription service may be Apple Arcade – April 16, 2019
Apple spends hundreds of millions to secure new video games for Apple Arcade video game service – April 15, 2019
What’s the point of Apple Arcade gaming service of more than 100 games across iOS, macOS, and tvOS devices? – April 1, 2019
Apple Arcade could be a sleeper hit – March 28, 2019
Apple introduces Apple Arcade – world’s first game subscription service for mobile, desktop and the living room – March 25, 2019

7 Comments

    1. Citizen X proves that a broken clock can be right at least once per day and say something useful. The rest of the time it’s just nonsensical rubbish, but every now and then even an idiot can sound like a genius.

      1. I’ll even make it easier on your simple mind.
        “Apple writes software to sell hardware”
        Notice the quotes? You do understand quotes, right? I never claimed it was my epiphany and I hope with your limited intelligence, you can understand that.

        That was Apple’s position 35 years ago brought us in an SOS Class at Apple training. Not Sophisticated Operating System Class but Solution Oriented Selling.
        Funny thing is the author thinks he discovered something.

        Oh. Help me out. What do you call a group of MDN Anonymous Cowards posters?
        Is it a Wail of Whiners or a Snit of Snivelers.
        I think trump supporters are the Snit of Snivelers but I might be wrong.

        They look the same from a distance and even close up.

  1. Like I was saying earlier. No one buys a Mac because of Apple’s ordinary mundane off the shelf hardware. They’re buying macOS and paying a premium to do so. Take away MacOS and Apple wouldn’t be able to give away their Mac hardware much less charge the ridiculous prices they do.

    Just look at the way people talk about how sexy the iPad is, and how it’s too bad the software sucks.

    IBM learned that software rules the hard way. They were accustomed to their big money coming from massive mainframe computers and it never really hit them that the computers were just junk without software. They were so blind to this fact that they handed the keys to the kingdom over to Bill Gates when they signed his infamous DOS lease. They didn’t own the software that made their PC run. Every time they sold a PC, money just flowed into Microsoft’s coffers. And when the PC was cloned, and other people started leasing DOS as well, incomprehensible amounts of money just flowed into Microsoft.

    It’s always software. And when this is understood, monkey boy dancing to the “Developers developers developers developers” chant doesn’t look so stupid.

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