The critics say that, any day now, Apple will hit the limits on iPhone growth. Sales will flatten and will eventually begin to drop. Perhaps that’s already happened with the iPad, witness the sales decreases since 2014, after a four-year run-up. Of course, tablets represent a different issue entirely that’s outside the scope of this column.<\/p>\n
Still, Apple has to prove itself each and every quarter. That the iPhone continues to gain against Samsung and other companies is evidently not so important. At one time, it seemed that Samsung was the unstoppable giant, until people decided that they weren’t so crazy about Galaxy smartphones despite all the praise lavished by some members of the tech press. Indeed, Consumer Reports continues to rate a Galaxy a tad higher than an iPhone, probably because it has more features. Less important to them is whether those extra \u00a0features really enhance the customer experience, or are merely window dressing to look impressive on bullet point charts.<\/p>\n
In any case, Tim Cook attempted to give the financial community reason to be optimistic during the quarterly conference call. He cited two significant numbers that indicate the potential. One was the fact that 30% of iPhone sales in the September quarter went to Android switchers. And that’s mostly before the new Move to iOS Android app appeared in Google Play. That app eases the process of moving your stuff from Android to iOS.<\/p>\n
But I do wonder how Apple managed to come up with\u00a0that statistic, unless the numbers are\u00a0based on some random surveys of new customers. It’s not that you have to tell them what you were using before you bought your first iPhone.<\/p>\n
Unfortunately, probing but sensible questions of this sort are never asked by the financial community or the few journalists who are granted an interview with Apple’s CEO. But I will take it as accurate until I have reason to be skeptical.<\/p>\n
Evidently that percentage\u00a0has increased in recent months, and it may just be the result of the fact that Apple went to higher display sizes beginning with the iPhone 6 last year. That long-expected move essentially eliminated the key feature the competition offered that Apple couldn’t match. Yes, there are still wider ranges of display configurations on other smartphones, but a tenth of an inch or two is no big deal, although some desperate companies might want you to think it gives you a choice. To me, it’s a choice of confusion.<\/p>\n
The other figure is of equal importance, and that is that only a similar percentage of iPhone users have upgraded to the newer versions. That leaves a huge opportunity for sales to people who are upgrading their gear, and maybe this will be that year. Despite the similar look, it’s been shown that the iPhone 6s actually offered far more new and enhanced features than its predecessor.<\/p>\n
Cook also cites the sales opportunities in developing countries, particularly as they establish and expand LTE networks. This doesn’t mean Apple plans to cut the prices any, but evidently iPhones remain aspirational products that more and more people whose incomes are growing will consider.<\/p>\n
Certainly the wireless carriers are doing what they can to entice you to upgrade. New lease-purchase schemes allow you to pay a monthly fee and upgrade your smartphone every 12 months, 18 months, or even two years without an extra charge. I think there are one or two plans out there that’ll support upgrades every six months, although that hardly makes any sense unless you are never satisfied. Apple also offers such a deal at their U.S. retail outlets, and that might be expanded to other dealers and countries.<\/p>\n
In short, if you opt for such payment schemes, you will never stop paying. Well, amend that. You can continue paying without upgrading until the end of the contract, usually two years. You then own your iPhone\u00a0free and clear.<\/p>\n
Such purchase schemes help the industry as they look\u00a0more and more towards upgraders to fuel smartphone growth, or at least keep it from flattening. A combination of upgraders and people buying a specific model for the first time might work for a time. So long as Apple can count on a decent number of Android switchers, that will also push growth, although a\u00a0plateau is inevitable. Otherwise, they’ve have to sell an iPhone to everyone on Earth to keep going.<\/p>\n
It does help Wall Street that Apple’s guidance for the current quarter is in the range of analyst estimates. If revenue matches those predictions, it’ll mean that the iPhone will continue to grow in the current quarter, though no doubt at a slower rate than last year.<\/p>\n
I also wonder how long customers will tolerate the endless upgrade cycle. Obviously people are keeping their iPads longer than expected, which is just one of the reasons sales have fallen short. So how long can Apple keep coming up with compelling reasons for you to buy a new iPhone? Isn’t there a point where even two years will be too short?<\/p>\n","protected":false},"excerpt":{"rendered":"
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