Digging deeper into Apple’s Sept. 12 event

Three long-time Apple watchers weigh in with three perspectives: Short, medium and long term.

SHORT New York Times’ Farhad Manjoo: Apple’s Watch Steals the Show. 

For the first time in years, I was truly surprised.

There’s just one catch: I felt this way about Apple’s new watch, not its smartphone. The phones were fine. Apple’s going to sell a lot of them and make a lot of money, as it does every year. But it’s the watch that might change the future most arrestingly.

The big deal: The new Apple Watch packs a slew of sensors to make it a truly novel kind of wearable device — something like a “Star Trek” tricorder on your body. The new watch can administer a medically accurate electrocardiogram, a test of a person’s heart rhythm that can help detect dangerous health conditions. It also detects and alerts rescue personnel to dangerous falls, a leading cause of injury, especially for older people.

By themselves, these features won’t change the world. But they may play a significant role in some people’s lives, even saving some from an early death. They also suggest a new era in tech.

MEDIUM Stratechery’s Ben Thompson: The iPhone Franchise.

This year, then, comes the fully-formed iPhone juggernaut: an even more expensive phone, with arguably one of the weaker feature-driven reasons-to-buy to date, but for the fact it is Apple’s newest, and best, iPhone. And below that, a cheaper iPhone XR that is nearly as good, but neatly segmented primarily by virtue of not being the best, yet close enough to be a force in the market for years to come…

That is the iPhone: it is a franchise, the closest thing to a hardware annuity stream tech has ever seen. Some people buy an iPhone every year; some are on a two-year cycle; others wait for screens to crack, batteries to die, or apps to slow. Nearly all, though, buy another iPhone, making the purpose of yesterday’s keynote less an exercise in selling a device and more a matter of informing self-selected segments which device they will ultimately buy, and for what price.

LONG Asymco’s Horace Dediu: Lasts longer. 

I think Lisa Jackson’s presentation at the September 2018 iPhone launch event was perhaps the most interesting and most profound…

Apple now strives to design and build durable products that last as long as possible. That means long-lasting hardware coupled with long-lasting software. She pointed out that iOS 12 runs even on iPhone 5S, now five years old. Because iPhones last longer, you can keep using them or pass them on to someone who will continue to use them after you upgrade…

So why would Apple want to do this?  What is the logic of this durability focus as a business model? It may be good for the environment but is it good for the bottom line?

The important call to make is that Apple is making a bet that sustainability is a growth business. Fundamentally, Apple is betting on having customers not selling them products.

My take: Don’t settle for my excerpts.

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  1. Fred Stein said:

    Nice. Adding to all three:

    Watch: With all the sensors, larger screen, etc., Apple Watch becomes the “one that does it all,” crowding out the niche wrist devices for health and safety applications. As upgrader buy the “4”, their used Watches end up on the wrist of younger people, making the Watch a coveted item with a new demographic. No other Watch can match them.

    Medium and Long: According to Business Insider, 134M used iPhone will be sold in FY18 up from 111M in FY17. Those used iPhones meet the market need for the $100 to $600 price range; And simultaneously reduces the net cost of new phones. Ironically Apple increases their ASP while giving the market iPhones ranging from $100 to $1449. The A12 chip in iPhones priced from $749 to $1449 is so far ahead of Android clones, that they will all lose pricing power, even Samsung.

    Business Insider source: https://www.businessinsider.com/iphone-installed-base-2018-3

    September 14, 2018

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