Apple: Not all that glitters is gold!

Among other reasons given in last week’s article for the big nose-dive in Apple’s revenues for its fiscal year that just ended, is the suggestion that Apple’s sales might have actually stalled. This means that the only direction that iPhone sales can go is down, not up; unless, of course, the company comes up with […]

Among other reasons given in last week’s article for the big nose-dive in Apple’s revenues for its fiscal year that just ended, is the suggestion that Apple’s sales might have actually stalled. This means that the only direction that iPhone sales can go is down, not up; unless, of course, the company comes up with one-of-a-kind product.
Looking ahead, Apple is not in an enviable position, really; its current $233 billion cash in the bank notwithstanding. The Mac PC is not doing well, iPad sales have been sliding for 6 quarters in a row, and there is essentially no significant service in the company’s revenue pool. Moreover, Apple Pay and Apple Watch seem more like experimental products – still in the labs, than cash cows, and the company’s venture into virtual/augmented reality, where it is certainly playing catch-up to SONY and the like, has not panned out – and it may not! Finally, Apple is not known for the cloud business, Internet of Things, or connectivity (5G). So, for Apple, it’s basically iPhone for now.
Apple’s iPhone 7 smartphone will be released around September/October 2016 time frame, if the company continues with the launch scheme it has followed for past several years. How iPhone 7 will fare compared to iPhone 6/6 Plus launched in September 2014 – which broke the bank for Apple, depends on whether or not iPhone 7 comes with out-of-this-world features that make consumers beat paths to the Apple store. So, naturally we want to know why people change their phones. Below are a few reasons.
Battery life: I can imagine a situation where one changes a phone because of poor battery performance. Poor battery life can be annoying. Unfortunately, as phones do more, they consume more battery power. Will the upcoming iPhone have significantly better battery life than the ones currently in the market? I doubt it, since research in battery performance has not caught up with consumer expectations.
Speed: iPhone runs pretty fast now, and chances are most consumers are quite satisfied with the speed of the current products. So, doling out $700 to $1000 for another iPhone solely for speed may not happen to any palpable scale.
Damage: You will change your phone if it is damaged to the point where essential functionalities are impaired. This reason by itself may not lead to a phenomenal surge in the sales of a new phone. Some tech observers have suggested that iPhones seem to break more frequently than other smartphones, because the “excavations” at the back of the iPhone, where the Apple logo sits, represents a weakening of the structural integrity. Phone sale may benefit from this factor, as strange as the idea is.
Theft: I know this for sure. I have lost a phone to thieves, and had to get a new phone. With all the “locate my iPhone” apps, not much business can be realized based on phone replacement due to pilferage.
Killer features: These can get the bank card out of your wallet. For example, Face Time in iPhone did it when it first came out. Larger screens also did it for iPhone 6/6Plus. Interestingly, there were many huge-screen-Android phones – Samsung Galaxy and those from China, way before large-screen iPhone. Obviously, the latter meant something totally different for almost a hundred million people worldwide.
Phone just stops working: Believe it not, I have had smartphones that just suddenly stopped working for no apparent reasons. In fact, I have experienced three of that: two HTC’s and one Samsung. Whether the problems were with the particular batches, or intrinsic software or hardware problems, I wouldn’t know. The outcome was that I had to buy a new phone each time the phones died.
There are other reasons why you change your phone: A gift of an iPhone will be a great gift. However, I don’t think Apple’s income from such gifts can save iPhone. Also, there are folks who apparently don’t know what to do with money, and if they are Apple diehards, you can be sure they will drop their bank cards for any released iPhone.
So, will iPhone 7 make it when it is released later in the year? I doubt it, based on the crude analysis shown above.  Moreover, the world economy is also not in Apple’s favor. The Chinese middle class love iPhone, but it seems that their lots are dwindling, a situation that is bound to affect their expendable income, and hence the ability to buy iPhone. China is becoming an increasingly hostile environment for Apple to operate in, from both the standpoints of Chinese government crackdown on the company, and the growing number of local competitors that promise iPhone-quality alternatives at significantly lower-than-iPhone prices. We shall stay tuned.