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« Whispers From the Void - When nothing is going on in tech, a few brief observations on the occasional news tidbits | Main | I Dream. No I Still Dream the iDream. Shouldn’t Apple Give Us the iCamera Now? »

August 23, 2017

Comments

James Glu

Hi Per,

I wish someone besides Tim Cook were reporting the Android switcher rate which has been 2 to 1 in Apple's favor the last couple year...if you believe Tim Cook. I agree with you with respect to Android premium users not going over to the iPhone. Of course, I'm one who believe the two camps are mostly "their own markets" by this time.

But...there is some amount of Android users that switch to iPhone and it's been a large enough force that Cook has highlighted that story to the investor community. I would think that most of those switching are coming UP from cheap Android. How so? These are people that couldn't afford an iPhone and have had crappy phone after crappy phone. Not because Android is crappy, but because cheap phones are crappy phones.

So,when they can finally afford a decent phone, they buy an iPhone. We have had years of experience to know that once people buy an iPhone they keep buying iPhones from then on.

Meanwhile the used iPhone market remains robust. You cannot find "a deal" on a used iPhone.

As to the "adding a week to this or that quarter". Long is right. The iPhone business is a juggernaut...not some sham needing to play fast and loose with the numbers. 1.2 BILLION iPhones sold. Half of those in active use. Apple released a $399 iPhone and STILL the average selling price is growing. The iPhone ASP is just shy of 3x that of Android. The Christmas quarter sales are only about "how many can Apple make".

10 years in and STILL Apple can never make enough to satisfy demand for 3 or 4 months after releasing a new model.

Per "wertigon" Ekström

@Jim:

Oh come on, you have to atleast agree the last christmas quarter was very convenient for Apple, with that extra week, since it allowed them to tell the world the iPhone still grew YoY for christmas.

Be that whether it's a fluke, or careful planning on Cook's part, we can agree to disagree on. But it *was* rather convenient, since without that extra week of sales the Christmas quarter would've looked significantly worse... :)

As for the incentive of switching away, I think you might be in for a rude awakening pretty soon. That must-have feeling of iPhone is gone for many, and for every user iPhone lose, it will be more and more dire.

Once iPhone is no longer "trendy" and "cool" anymore, that's when we shall see what happens for real. :)

Abdul Muis

@jim

"I will acknowledge that the low cost "mid range, premium" Android phone sales in China are indeed eating Apple's market, that the values and taste of the Chinese have indeed changed."

No.
The value and taste of cina buyer hasn't change. What changed is the perspective if Chinese buyer that iPhone is not sexy anymore. iPhone is not status symbol anymore

E.Casais

"the Note 8 is a $1000 phone (minus a sawbuck or two)."

In Switzerland, the cheapest Galaxy Note 8 you can buy (64GB duos) is priced at CHF 998.90. Add 5% to get the price in USD, subtract 10% for the price in EUR.

My personal criterion is that a mobile phone (new, unlocked) should not cost more than CHF 350.

A more expensive one comes into play only for strict, no-alternative-available kind of reasons (e.g.: professional: it is the only device fit for purpose in a business setting; personal: you are disabled, and only that device supports some software / peripheral indispensable for coping). But, as is commonly said, to each its own, your mileage may vary, de gustibus non est disputandum.

Per "wertigon" Ekström

@Jim:

I do not know which numbers you go by, but by Apples own numbers:

Q1 2015 61.17
Q2 2015 47.53
Q3 2015 48.05
Q4 2015 74.78
Q1 2016 51.19
Q2 2016 40.4
Q3 2016 45.51
Q4 2016 78.29 <-- Here extra week, would've been around 75M without it
Q1 2017 50.76
Q2 2017 41.03

Last 2 Q1s iPhone declined YoY, Q2 was decline last year, slight incline this year. Q3 looks like increase, Q4 looks like decrease for now. This model does not account for the iPhone 6 generation, however...

James Glu

Hi Abdul, we shall see. What will be your stance when the new iPhone sales take off like a rocket in China?

Abdul Muis

@james.

The new iPhone will increase the sale of iPhone if the size is bigger. Chinese love big size phone. But for one year moving average in china, apple won't beat its own record.

If apple manage to sell more in one year moving average. Then, Im wrong, you were right. That iPhone brand is still powerfull in china... Please nite that I use 'still'. Because no brand is 100% powerful. 15 years ago, BB brand also powerfull. Their second hand product sold in africa, south east asia at a high price just like iphone today.

Abdul Muis

My guess is...
If apple increase the phone size and still use 16:9...
They will replace the tiny 4.7" with 5"-5.3"
And they replace the small 5.5" with 5.7"-6"
Just like every other phone brand size..

LongAAP1997

"Q4 2016 78.29 <-- Here extra week, would've been around 75M without it
Q1 2017 50.76"

Now there you did it again. You did not add the difference to Q1 results you just made the 3,29 million phones to disappeare.

Tester

Depends on whether Q1 was a week shorter. Maybe they should be added to the preceding Q3? In any case, when doing these things, it should be stated how many weeks were counted to a quarter - or do it right from the start and count the actual months, not weeks that may extend into other quarters.

Per "wertigon" Ekström

@Long:

I was specificly referring to Q4. Obviously Q1 would've gotten slightly higher than usual, yes, but then the X-mas quarter would've been down.

Or like Tester said, that extra week could've been Q3 as well. We will never know, all we know is, it was very convenient to arrive this year. :)

Abdul Muis

@long

The q1 still have normal weeks. Not shorter. So, PWE is right.

LongAAP1997

"The q1 still have normal weeks. Not shorter. So, PWE is right."

You do not get it either. If he deducts those phones from the AAPL fiscal Q2 then he has to add those to the AAPL fiscal Q3.

LongAAP1997

" when doing these things, it should be stated how many weeks were counted to a quarter - or do it right from the start and count the actual months, not weeks that may extend into other quarters."

For the starters. Apple is an American company. If they do not do these kind of BASIC things they will be sued so badly that it would be ridiculous. We are talking about tens of billions of dollars. You can be 100% sure that Apple CEO Tim Cook and Apple CFO Luca Maestri won't do that kind stupid rookie mistakes.

LongAAP1997

"As was noticed in the summer, Apple’s last quarter of 2016 was already planned to include an extra week due to the last Saturday of the quarter, the day on which Apple typically closes its books, falling on December 31st. Having concluded its previous quarter on September 24th, Apple could have kept to a 13-week quarter if it had ended its reporting on December 24th — but that would have broken with its tradition and made it harder to parse by excluding the last week of December. What it means now is that the company’s totals for the last three months of 2016 look better than they otherwise might have done, while its numbers for the first three months of 2017 are likely to look worse."

This is from the Verge.

Per "wertigon" Ekström

@Piot: So it was planned well in advance. Fine, I concede there was no intentional trickery on Apples part.

I still maintain it was awfully convenient, since it saved their YoY constant growth meme though.

Abdul Muis

@long

For wall street, apple didn't do any mistake. Since wall Street didn't care about how many device apple sold. They only care for profit.

For the sake of this website, apple were conviniently cheating when reporting the number of the phone they sold but didn't say it for one more week.

James Glu

It's funny listening to you guys striving so hard to find an "Apple is failing" angle. It doesn't matter what quarter the sales for that week were accounted for. The sales happened. If you put them in 1 qtr then you take them away from the other.

Even Apple stopped reporting on open weekend sales....because the number becMe meaningless as it only measured how many Apple could make, not what demand was, That's true of the entire 4th qtr. Apple sells every phone they can make.

Pay attention to the rolling 4 qtr because Apple's annual release makes individual incomparable.

No matter how you slice it, the iPhone 7 sold well. It did not follow the decline of the 6s with further decline. And that's WITH a sharp decline in China.

Abdul Muis

@Piot

I think you need to read the news. It is samsung that have the exploding phone, not apple. Don't give apple credit for the mistake they don't do.

john F.

@ per
So it was planned well in advance. Fine, I concede there was no intentional trickery on Apples part.

vs

@Abdul
apple were conviniently cheating when reporting the number of the phone they sold but didn't say it for one more week.


Per wins 10 - 0 this boxing match by TKO.

Abdul, 10-Q are filled in advance, detailed and available to anyone upon request, remember I told you a few days ago, if you are too passionate about analyzing Apple instead of being objective to facts, statements you say are a not serious, I understand, you dislike the brand and products, and that's ok but you fail to see and understand some data that would help you say the right thing in proper way.

A correct statement as an example would be;

For me the iphone is overpriced and i don't want to overspend, now it is undeniable that it is the Nr 1 smart phone in the world
in the above 600 dollars category.

If you would say something like that, I would say, wow! what an objective person.


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