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May 23, 2018

Comments

BennyDover

Samsung is no more. The decline of that company is going to go on. You do not have to worry about it. Samsung does not have the possibility to coby Apple anymore. Apple moves everything in-house and thr Samsung will be the outhouse.

Per "wertigon" Ekström

@Jim:

Your analysis is based on the premise that the premium space isn't shrinking.

Unfortunately for you, it is.

When Apple costs 3x as much as it's closest competitor... What do you believe will happen? Hmm? The moat will shrink on the excess, and then... Sales collapse.

But by then it'll be far too late.

Apple has a few good years left, sure... But the iPhone will start dropping soon. Because market theory says it has to.

Jim Glu

Per...we agree the premium space is shrinking..,,just not Apple's premium space. Apple is still growing, just not like it had in the past. That’s what it means to have a mature market. Keep in mind that while everybody understood the premium market had to reach a limit some day....none of you naysayers thought it would ever get this big. By the time of the iPhone 4 people were saying the end is near.

Apple is growing by continuing to draw away Android users and as the new generation of consumers reach phone buying age.

We have had cheap but decent Android phones for years. Samsung has been on a decline in premium phones since the Galaxy S4. Not so for iPhones which have kept growing.

Apple’s most expensive phone was also its best selling phone and the number one phone in the world. This was a new thing even for Apple.

Unlike you and I, Apple has the real data from which to make its decisions. There is no way they dropped the SE and 6s lines if they didn’t have the data to tell them IPHONE customers weren’t that price sensitive. They will let used iPhones service the lower price points.

The iPhone 7 is at a great price now. It’s worth $100 more than an iPhone SE.

You are not wrong about what MOST people will do. With 80% share of the install base....clearly Androids cheaper price points have won the day. There are simply far more people than you want to believe that are willing to pay more.

iPhone X has a 98% customer satisfaction score. Apple customers love their Apple products.

It's over 3000

@Jim

You always assume when people have money, they will change from android to iphone. You certainly haven't use Samsung Galaxy Note or Huawei P20 Pro. Non-iPhone flaghship is better than iPhone, otherwise, these deep pocket user will buy iPhone instead.

As for iPhone 7, there's nothing interesting. For those who understand phone, they will skip a device that will expired next year from Apple catalog.

It's over 3000

@Per

Apple will grow slightly this year because they announce 3 model & bigger size. Perhaps Apple will manage to sell 230-235 million device for Q4 2018 - Q3 2019.

It's over 3000

@Benny

Samsung decline has nothing to do with Apple. It's more about Samsung bad product lineup.

Per "wertigon" Ekström

https://www.cnbc.com/2018/08/20/apple-shares-downgraded-because-the-iphone-x-is-too-popular.html

Quite a few analysts believe the iPhone X was too successful, and will eat into this cycles sales.

And the premium space in smartphones shrinking is bad for Apple - it means there is nowhere left to go for Apple. Even if Apple temporarily can grow some units, it won't be by much and it will not last.

It's over 3000

@Per

That's analysis is before Apple introduce the 2018 lineup.


Per "wertigon" Ekström

@>3k: Yes, but the analysis did assume a snoozefest 2018 lineup... :)

BennyDover

@Per

That analyst is an idiot. iPhone X is too popular so the AAPL has to go down. WTF??
The amount of idiocy in that statement is more than the mount Everest

Tester

@Benny:

While I fully agree that this analyst is an idiot, you can be certain that many investors won't see it that way.
Essentially what happens now is something I predicted several years ago already:

Everybody is so much in awe of Apple's success that even the slightest dent which normally should merely realign opinions to more reasonable proportions, there is no such thing as "reasonable proportions" with Apple. It's all an overinflated image of a company filled with magic ingredients. Once the magic fades and people start to realize this, it will inevitably result in a backlash that is far, far stronger than deserved.


On the other hand: What if he is right and the iPhone X has indeed caused many users to upgrade early? If we think in realistic terms, "faster, faster, faster" won't cut it anymore to make people want to upgrade - except gamers, but those are only a small minority.
Looking at Apple's recent numbers, I haven't seen any significant sales spike, and yet he claims that "many upgraded early". If this is really true, the numbers from the early upgraders would have just masked the overall decline - and that'd be bad news for Apple.


It will be interesting to see how this plays out, and who is right, but I think it's becoming increasingly clear that Apple is serving a fully saturated market by now, only living on replacement sales. So what if people do not need to replace this often anymore, because the yearly advancements are not enough?

BennyDover

Apple has sold 2 Billion iOS devices and it has over Billion customers. They have enough customer base to increase their sales year over year. Apple does not need their customers to upgrade every year. Upgrade every two three years is sufficient. Hand downs and second hand market increases the user base every year in double digits.
You have the price range from around 500€ to 1500€ as new.

Jim Glu

I don’t guess that Apple is still gaining Android customers, Apple tells us so when reporting to their investors.

I don’t dispute that there are some terrific Android phones out there. But nobody is filling in the amount of premium phone sales that Samsung is losing. Galaxy S and Note phones are terrific. However, the “good enough” mid range is killing the market for those top end flagship Android phones.

The assumption that said abandoning of high end to mid Android WILL happen has YEARS of it “should have happened already”. Why haven’t iPhones suffered the same decline in sales as Samsung's? The Galaxy S4 was 5 years ago. And no other Android premium line has stepped in to take up the slack. Pixels are nice, but their sales are insignificant still. Nokia's top end doesn’t sell much either. Sony, HTC and Motorola are waiting to see who will go out of the smartphone business first.

The choice Apple customers are making is to hold onto their iPhones longer...not ditch them for cheap Androids.

BennyDover

Apple special event recap.

https://youtu.be/iol8n3m88SA

It's over 3000

@Per

Several of the main reason on why people upgrade in a couple of last year
upgrade to 4G phone
upgrade to bigger screen size
upgrade to faster phone
upgrade to bigger storage

Other reason than buy new phone
Broken phone
Stolen phone
Lost phone

I assume,
Anyone who can afford the 2018 iPhone already have 4G phone, already have fast phone.

Therefore,
Bigger screen size might be the biggest factor.

This is also one of the reason why iPhone X is quite successful. It manage to hold iPhone sales not to dive drastically, but only down a little compared to the year before. This year, Apple bring 6.1" iPhone with a $700ish price tag. I think it might increase sales a bit.

It's over 3000

@Benny

"That analyst is an idiot. iPhone X is too popular so the AAPL has to go down. WTF??
The amount of idiocy in that statement is more than the mount Everest"

It's called super cycle. The analyst believe iPhone X is super cycle, therefore this year sales will dry up.

"Apple has sold 2 Billion iOS devices and it has over Billion customers. They have enough customer base to increase their sales year over year. Apple does not need their customers to upgrade every year. Upgrade every two three years is sufficient. Hand downs and second hand market increases the user base every year in double digits.
You have the price range from around 500€ to 1500€ as new."

This has been discused here many times, and have been debunked by Tomi. Active iPhone is about 500 million. Not 1 billion!!! Do not make false statement.

It's over 3000

@Jim Glu

1. mid-range android did not kill premium android just like cheaper android premium did not kill iPhone.
2. The premium android user just use their device longer, just like iPhone user.
3. In the past, iPhone fight with premium Sony & premium Samsung. Now, premium huawei, premium xiaomi, premium VIVO, premium OPPO were also fighting to get the premium market.
4. The real battle for iPhone this year & next year is Europe. Huawei & Xiaomi just enter Europe in a big way, and this will shake iPhone market share. This will be interesting battle.

Jim Glu

Do you have the numbers 3k? We know that Samsung sales have been in dramatic decline ever since the S4. Apple, on the other hand, keeps growing. Not by leaps and bounds in unit sales, but not dramatically declining like Samsung. If they are both just keeping their existing customers longer....why the different results?

Do you really think the Chinese can make a phone at $600 that is "the same" as the one's Samsung is sell for $1000? Same chip sure. Same everything else? Are they just THAT much more efficient? Is Samsung some old lazy company that doesn't know how to run on thin margins? I don't think so.

And once those same Chinese start selling in the developed world that protects intellectual property, they will have to raise their prices to cover the cost of licensing the patents they are currently ignoring. They also have to spend the marketing money, develop the sales channels etc. Their phones that truly compete with Samsung's will cost very close to the same amount when they fully take on selling into the west.

But the vast vast vast majority of Android sales aren't even for these handsets. It's the very cheap Android phones where Android's huge unit sales come from.

Jim Glu

As for the Super Cycle. It fizzled. It did not happen. Flat sales...2% increase...that's not a super cycle. The predicted super cycle did not happen.

Apple increased revenue nicely. Not unit sales. This year's offerings are set up for more of the same. Vast majority of sales going to existing iPhone customers. Those with iPhone 6/6s are going to upgrade...and the vast majority will buy another iPhone. The prediction that there would be a large increase due to an exceptional amount ready to upgrade did not happen.

Will it happen this time? I really don't think so. iPhone's already sell more than that amazing iPhone 6 year. So we shall see these folks upgrading...but that's pretty much most of the sales that will happen. There simply isn't that much "non existing iPhone owner" sales to come. That's my prediction.

I think it's very shallow analysis that ever time Apple increases screen size there will be a large jump. There was the FIRST time...but that doesn't mean "if iPhone 6+ screen was good, iPhone Xs Max will be better!". Plus Apple has increased the price significantly for that new largest screen.

I think we are in for another year of nice, but small growth in units with a very nice growth in revenue.

It's Over 3000

@Jim

Again, You were assuming that Chinese Android is bad. Huawei P20 Pro is as expensive as Samsung Galaxy Note 9. Oppo & Vivo flagship is not cheap too. You're also thinking like Trump, that China break the law, Chinese company steal IP. Huawei is one of the biggest in 3G & 4G IP. They have more 4G IP than Apple.

About supercycle. The 2017 is super cycle because Apple introduce a new design & new screen size. The Apple FY 2017 sales down 15 million according to this blog. If Apple only create iPhone 9 that were mostly the same as iPhone 8 in 2017, Apple sales would dive like crazy. Therefore, iPhone X manage to save Apple by only down a little bit.

Apple understand the situation, and react. This is good. It's mean Apple want to survive. Therefore in 2018 lineup, Apple create a giant 6.5" phone that if their founder, Steve Jobs, still alive, he would put a sandblast paper in the 6.5" iPhone box. Apple also create a 6.1" cheap iPhone. 2 new big screen size. 1 expensive & 1 cheap. Great strategy to reverse the iPhone fatigue. Good.

I also agree with @Tester comment. If this 2018 lineup still can't revive the sales number, Apple/iPhone is in great danger.

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