iPad(3) sales in China onto a weak start. iPhone luster wanes.

[Sheep]

Nobody in their right state of mind would buy more of the same gadgets without at least 12 months of amortization time.

While this is true, this assumes that everyone is on the same contract cycle. What if my contract expires 7 months before the next model is scheduled to be released, which may or may not actually happen (e.g., the iPhone release cycle hasn't always been at the same time of year)? My choice is to buy a 5 month old device which is a long stretch of time given how quickly technology develops or wait 7 months or longer for the next refresh.

While I think the update cycles of many Android manufacturers is too short, I also think Apple's is too long.

 

[Mopetar]

It's a bad thing for the investment analysts that were expecting much more than that.

Yes, but what's bad for investment analysts isn't necessarily bad for Apple. The initial comment was that Apple was in decline, but as the other poster pointed out, that's kind of hard to backup when their market share of tablet shipments actually grew.

Who cares if some analyst thinks that this is the end of Apple. There are going to be several more that agree, but a dozen others that are recommending a buy. Unless someone does some analysis of all of their predictions and figures out that there's one guy who always seems to be right, I wouldn't read too much into it.

A company's stock price only reflects that market's confidence in that company and doesn't always correlate to how well that company is doing. In the past ten years, there were two points where Apple's stock took a huge plunge. The first was due to some random rumor that Steve Jobs had been rushed to the emergency room. The second was due to global financial trouble. In both cases, nothing about Apple had actually changed, but their stock price took a huge swing. The market doesn't always act intelligently, which is why you could buy a company like RIM for much less than the value of their assets.

 

[rakez]

the reuters article said there was only 20 people in line for the release of the ipad 3 in china. i don't have to believe it because it was on the internet, but i saw it on Bloomberg when it happened as they televised it. reuters article http://www.reuters.com/article/2012/07/20/us-apple-china-idUSBRE86J04G20120720?

 

[psych2]

That's ridiculous.

A 1 year cycle is perfect for their products.

Nobody in their right state of mind would buy more of the same gadgets without at least 12 months of amortization time.

It is Samsung, Nokia, and everyone else that is doing wrong, by pumping out new models faster than their rate of adoption. With a 1 year cycle, Apple has more R&D time to develop a better product, and catches most consumers, even those who already own an Apple product, when the upgrade bug bites.

Hmm lets see, locking people to your device with 2 year contracts all year round or doing it in the fall every year, which one makes more business sense?

 

[jpeyton]

Samsung has several phones in their smartphone portfolio. That allows them to stagger their release dates a few months apart, offering a steady stream of new phones for cellular customers to purchase. The SGS3 was released two months ago, and the Galaxy Note 2 will be out in August.

Apple has one phone, so their hands are tied. They will have two blockbuster quarters of sales, followed by two lagging quarters as their phone ages and people wait for the new model.

 

[MrX8503]

I don't mind Apple's slow update cycle because I keep my phone for 2 yrs.

 

[MotionMan]

It's a bad thing for the investment analysts that were expecting much more than that.

They expect Apple the baseball team to have an undefeated season and are disappointed when they only go 161-1.

I don't mind Apple's slow update cycle because I keep my phone for 2 yrs.

This.

MotionMan

 

[JAG87]

Hmm lets see, locking people to your device with 2 year contracts all year round or doing it in the fall every year, which one makes more business sense?

Nobody is pointing a gun at you to sign a 2 year contract, or even worse a 3 year in Canada.

You can get an unlocked phone, and be on your way. Then when the next one comes out, sell the current one for 2/3 to 3/4 (depending on condition) of what you paid, and buy the new one.

This way you always have the latest and greatest, only pay around $150 a year to have the latest phone, with carrier freedom, and plan freedom (very important since to get a subsidized phone you need at least a $50 a month plan, and both you and I know you can get away with less than that with all the wifi and voip solutions nowadays).

So there you have it, you can get a $40 a month plan instead of a $60, save $240 a year on your bills, and practically continuously upgrade your phone every year for free.

Just because the majority of people do it wrong, doesn't mean there isn't a better way.

But one thing is for sure, I would never chase Samsung or whoever with their silly release cycles. There's a new better phone every quarter, and while the hardware might not matter as much, it would really piss me off to have to put up with OS fragmentation, especially when they stick new stuff under my nose so often.

So I choose Apple. Makes my life simpler.

 

[dagamer34]

The design is 2 years old at this point. Unless you were a diehard fan, you'd be hard pressed to tell the difference between an iPhone 4 and iPhone 4S without careful inspection. And there's clearly a market for phones that have a screen size larger than 3.5".

As for me, I've had all 5 different iPhones over the last 5 years and it's time for something different.

 

[dagamer34]

Samsung has several phones in their smartphone portfolio. That allows them to stagger their release dates a few months apart, offering a steady stream of new phones for cellular customers to purchase. The SGS3 was released two months ago, and the Galaxy Note 2 will be out in August.

Apple has one phone, so their hands are tied. They will have two blockbuster quarters of sales, followed by two lagging quarters as their phone ages and people wait for the new model.

Thing is, normal people are become very acutely aware of Apple's product cycles. While they almost always existed in their Mac product line if you studied Intel's product roadmaps, the fact that they very publicly announce only one product a year and a new version of iOS is announced 3 months prior makes it stupidly easy to know when a new iPhone is coming. And there are just so many freaking part leaks, it's not even funny.

 

[jpeyton]

The design is 2 years old at this point.

And the embarrassing part is they tried to "differentiate" the 4S is arbitrary ways, like making Siri exclusive to it. We all know that Siri doesn't require an A5 chipset; almost all the horsepower required for voice assistants is done in the cloud.

It makes you wonder if Apple's industrial design team is even capable of a new form factor in less than 2 years time (3G/3GS, 4/4S, 5/5S?).

 

[Bateluer]

i lol'd

Apple has a bad quarter that HTC, Samsung, Nokia etc would kill for. The irony of your arguments

Ah, I love chances to educate people!

If you read the article, you'll see that they stated the same thing I did, the Apple star has stopped rising. Stopped. Rising. No one said anything about reversing or declining. This quarter was less than previous quarters, and far less than analysts predicted. As noted by Apple, this was far less than they thought too.

They've peaked, and in the face of stiff competition from all sides offering better pricing, better designs, better hardware, better specs, etc, they simply aren't able to keep up. They've all but resorted to petty lawsuits to try stifle competition. This is what is meant by 'the star has stopped rising'.

Now, you can leave smarter and better for the experience. You are most welcome.

 

[jpeyton]

If you read the article, you'll see that they stated the same thing I did, the Apple star has stopped rising. Stopped. Rising.

Indeed: http://www.bgr.com/2012/07/24/apple-q3-2012-earnings-analysis/

Their growth numbers have rapidly declined year-over-year, and even from Q1 2012 to Q2 2012. In Asia-Pacific, growth dropped from 110% to 25% from Q1 to Q2. This is the same region where ZTE and Huawei have reported record sales numbers for their Android-based smartphones.

 

[s44]

duplicate, pls delete

 

[s44]

The iPhone 4S is a damn fast phone, and if they had launched it just with a bigger screen, I think it wouldn't feel as left behind with the market today.

No LTE = unbearably slow on 2/3 carriers (and horribly congested in major cities on the third)

 

[MrX8503]

Why is Apples slow update cycle news to anyone? They're unable to keep up? Apple chooses to have a slow update cycle. Where was everyone then when Androids market share declined when the 4S was released? The same will happen again when the iPhone 5 is released.

Apple takes +70% profit of all phone sales, but they're doomed! Meanwhile HTC,Moto, and LG that are sharing 1% are rising stars!

 

[rsutoratosu]

China's economy isn't exactly booming right now, I doubt if I was living in China, I would rather pick food over an ipad3. Most of the people that wants and ipad3 already got it when HK had it last year, you would go across to HK, buy it and bring it back to China, why would you wait for apple to release it.

Anyone who thought China was impervious to either the perilous state of the global recovery or the laws of basic economics should take a look at the data streaming out of the country in recent months. GDP growth in the second quarter slipped to 7.6%, the slowest clip in three years.

Read more: http://business.time.com/2012/07/26...own-why-stimulus-is-a-bad-idea/#ixzz21jZRzWPV​

 

[MotionMan]

Ah, I love chances to educate people!

If you read the article, you'll see that they stated the same thing I did, the Apple star has stopped rising. Stopped. Rising. No one said anything about reversing or declining. This quarter was less than previous quarters, and far less than analysts predicted. As noted by Apple, this was far less than they thought too.

They've peaked, and in the face of stiff competition from all sides offering better pricing, better designs, better hardware, better specs, etc, they simply aren't able to keep up. They've all but resorted to petty lawsuits to try stifle competition. This is what is meant by 'the star has stopped rising'.

Now, you can leave smarter and better for the experience. You are most welcome.

Let's check back after the new iPhone has been out for a full quarter.

You may be right, but I think that will be a good indicator of the direction of Apple's star.

MotionMan

 

[ChAoTiCpInOy]

Let's check back after the new iPhone has been out for a full quarter.

You may be right, but I think that will be a good indicator of the direction of Apple's star.

MotionMan

Plus most people have figured out that Apple releases a new iPhone every year, so they nkow when to wait now.

 

[cheezy321]

Ah, I love chances to educate people!

If you read the article, you'll see that they stated the same thing I did, the Apple star has stopped rising. Stopped. Rising. No one said anything about reversing or declining. This quarter was less than previous quarters, and far less than analysts predicted. As noted by Apple, this was far less than they thought too.

They've peaked, and in the face of stiff competition from all sides offering better pricing, better designs, better hardware, better specs, etc, they simply aren't able to keep up. They've all but resorted to petty lawsuits to try stifle competition. This is what is meant by 'the star has stopped rising'.

Now, you can leave smarter and better for the experience. You are most welcome.

This quarter was less than the quarter before it. Was it less than the same quarter a year ago? No. Was it less than the quarter 2 years before it? Hell no.

Will you admit your 'education' is bunk when apple has a blowout quarter when the iPhone 5 is released? You have now used your one chance to call their peak. Good luck with your guess. In 2 more quarters we will see where they stand.

On a side note, I still have no idea how people correlate the lawsuits to apple becoming desperate. No clue how you can take that leap of logic.

 

[mammador]

China is a secondary market for them. How many people in china can afford an iPhone? It still is a poor country by and large, hence it's status as an emerging market. In most developing countries, dumbphones/low end smartphones sell better. the smartphone market is essentially a first world one. In such countries, Apple is still doing well.

I don't think this is a bad omen for them, as the 4S is still up there (arguably the leader still, Samsung notwithstanding) in terms of build quality, specs, etc.

I doubt Cook will care to that much of an extent, as Apple's core sales are in Europe and North America.

 

[ChAoTiCpInOy]

China is a secondary market for them. How many people in china can afford an iPhone? It still is a poor country by and large, hence it's status as an emerging market. In most developing countries, dumbphones/low end smartphones sell better. the smartphone market is essentially a first world one. In such countries, Apple is still doing well.

I don't think this is a bad omen for them, as the 4S is still up there (arguably the leader still, Samsung notwithstanding) in terms of build quality, specs, etc.

I doubt Cook will care to that much of an extent, as Apple's core sales are in Europe and North America.

China is not a secondary market for them. China Mobile is the largest mobile operator in the world with 600 million subscribers. China Telecom has around the same number of subscribers as AT&T and Verizon. Why do you think Apple focused on the new features in iOS 6 for China?

 

[Suspicious-Teach8788]

People seem to think of China as this poorass country, but that's just NOT how it is. I think the issue is the 80/20 model of China though. 80% functionality for 20% of the price. As a result there's a lot of competition against the iPhone.

I see this in other Asian countries, but the iPhone itself is a status symbol. People in Taiwan or Hong Kong will bypass the cheap imitations for the real thing because it means so much more. Even though the iPhone is on only one carrier in Taiwan, there's millions who will buy unlocked phones.

I think the issue is that China's networks are incompatible?????? Ibelieve they do have a UMTS 2100 network for some carrier, but China Mobile doesn't use the typical GSM standard. Those who wanted the iPhone already bought one unlocked. The rest get shafted.

 

[Dari]

Plus most people have figured out that Apple releases a new iPhone every year, so they nkow when to wait now.

Very true. A lot of the analysis of the carriers' earnings bear that out (higher margins due to people waiting to purchase an iPhone). Their margins will take a hit when the next iPhone comes out.

 

[Yongsta]

Apple needs to expand their phone lineup like they did with the ipod (touch classic nano shuffle) and mac lines (mini imac macbook pro macbook air mac pro). Why not give consumers more choices through multiple offerings (small screen, medium screen, big screen)? I think they're limiting themselves.