Monday Morning News


#1

Originally published at: https://appletalk.com.au/2019/01/monday-morning-news070119/

While everyone was recovering from the new year-induced stupor, Apple sent out a curious press release advising of revised financial guidance for Q1 2019. The letter from Apple CEO Tim Cook to Apple investors lowered figures across the board, with revenue dropping from $4-9 billion compared to Apple’s initial estimates. Apple points to both macroeconomic and Apple-specific factors as the reason for lower financial results in a lengthy PR letter, summarised as follows: iPhone launch timing, the strength of the US dollar against foreign currencies, supply constraints for new products, and economic impact in emerging markets, with Cook specifically detailing out China and the iPhone in terms of how they affect Apple’s financial results.

John Gruber says there’s only one way to see this updated financial guidance, and it’s all bad news. Gruber points out that the last time Apple issued an earnings warning was in June 2002, which was a very different Apple than the company we know today. As it turns out, iPhones aren’t selling as well as they used to, and China isn’t helping grow Apple’s revenue as much as they probably had hoped.

Additional commentary from M.G. Siegler says that there’s language embedded in the post about how Apple may have realised it made the iPhone a touch too expensive. While there’s still hope in Apple’s services business, it seems unlikely that services will be the business that continues to grow the company. Steven Sinofsky also has some interesting points regarding iPhone pricing, discussing the low-end market that Apple has somewhat steered away from, or attempted to penetrate both in China and India.

Or perhaps it’s like The New York Times says, and that Apple’s biggest problem is Kevin Roose’s mum. But not just his mum, many mums the world over. Mums who are perfectly content with their iPhones that are already a few years old, and who don’t see the need to upgrade anytime soon, much less every year, or every other year. The argument could be made that Apple has made the iPhone so good that there’s very few good reasons to upgrade now, especially if you have something that’s between 3-4 years old.

Interestingly enough, sometime over the holiday break Apple started offering and marketing a new iPhone trade-in deal that wasn’t previously available. For a limited time, you can trade in an iPhone 7 Plus to upgrade to an iPhone XR or iPhone XS from $849 or $1,249 respectively, which presumably makes $380 the maximum price you can get for your <s>old and busted</s> probably perfectly fine iPhone. It’s similar to the offers that Apple are running in the US, although it’s unclear how much this is a bonus over its regular trade-in offers.

Apple released another press release just days after the updated financial guidance, telling us about record-breaking numbers for the App Store to cap off 2018. Over US $1.22 billion was spent by customers between Christmas and New Year’s Eve last year, with $322 million spent on New Year’s Day 2019 alone.

And while App Store spending may be up, Netflix has disallowed new subscriptions within its iOS app. Netflix has long been the highest-grossing App Store app across many markets, with iOS-based subscriptions accounting for US $853 million of its annual revenue in 2018. Apple would have taken $256 million of that, but no longer. Netflix now does not support iTunes as a payment method for new members, although existing customers currently using iTunes as a payment method can continue to do so, at least for the foreseeable future.

Six Colors went hands-on with Brydge’s keyboard for the 12.9-inch iPad Pro. What’s widely regarded as one of the best iPad Pro keyboards has now been updated with a new design that matches the straight edges of the new iPad Pro, turning your iPad Pro into more of a laptop than it ever was before. You know, if you’re into that.

GarageBand turned 15 last week, getting its introduction at Macworld 2004. Being able to mix tracks to put together little audio clips in a user-friendly interface was a novel ideal at the time. I’ve never seen the video where GarageBand was demoed live on stage with John Mayer, but to this day, I still hear recognisable GarageBand loops used occasionally in media.

An iOS 11 feature lets you select multiple apps to move them all at the same time. Judging by the amount of times that I have seen this tip recently, it’s not something that’s widely known.


#2

When the iPhone I’d like to have, costs more than the Mac I would also like to have… there is something wrong with the pricing. Expecially since iPhone is manufactured in China where workers are paid a pittance and it costs not nearly as much to make as it would if it were US manufactured. If the latter, I would understand those huge prices. But it isnt, and I don’t. Upgrades have to be necessary and affordable, and they arent. I doubt that I will ever go Android, but never say never. I’ve even been looking at “Dumb” phones lately.


#3

Not to mention Apple’s insistence at avoiding hybrids because of the potential impact on their iPad sales, which in turn results in them losing market share to MS. Pop quiz, Apple. Would you rather have less iPad sales or no MacBook or iPad sales?


#4

I feel as though Apple sees themselves as the Gucci of the tech industry. Wherein they think they can charge literally whatever they want for their products (in an increasingly upwards fashion) because their brand has some luxury cachet. Whilst this is true to an extent, it’s still a commodity product which has a definite price ceiling.

Now we need to see if they actually lower prices to a reasonable level for the releases of 2019. Something tells me that they won’t, simply because they can’t compensate that lost revenue in sales volume alone. It’s a chicken and egg scenario, one that I never thought I’d see Apple in :confused:


#5

With the amount of criticism, and now revision of profits, one would think they’d have to reconsider pricing…

Increased sales at lower profit can be better than higher profits with low sales…


#6

I suspect we’ll continue to see ‘deals’ like the trade in offer aimed at boosting flagging sales numbers. And I wouldn’t be surprised to see the iPhone Xr discounted like the 5C was (not being the flagship product they can do that without hurting their brand) but the Xs and Xs Max will stay close to their original prices for quite some time.