Weak iPhone 6S Performance Forcing Apple Into Drastic Action

Forbes ^ | January 5, 2015 20:56 UTC | Ewan Spence

[Up Yours Marxists]

While the latest smartphones from Apple might have picked up critical acclaim after their launch in September, Apple is ready to cut the production on the iPhone 6S and iPhone 6S Plus lines by thirty percent, reports Nikkei.

Nikkei suggests that the drop in production follows slower sales in Q4 2015. Apple's production for the iPhone 6S family matched the production numbers for the iPhone 6 and iPhone 6S Plus. The lower sales of the newer handsets have led to more stock in the supply chain than Apple is apparently comfortable with, so the production will be slowed down for the next three months to reduce the backlog.

[tacticalogic]

But of course, that slowdown action is interpreted as The Sky Is Falling by those who make money when Apple sneezes.

I expect there's just as many people betting in the other direction, and motivated to spin the interpretations in the other direction, but the reports on the outlook for the Chinese economy appeared to be pretty gloomy from all quarters.

It remains to be seen if they just miscalculated the demand curve, or if the expected demand just isn't going to materialize at all.

[Rome2000]

Faggots, they throw a monkey wrench into everything!

https://www.youtube.com/watch?v=jEGvlH4BCUQ

[who_would_fardels_bear]

First derivative is velocity.

Second is acceleration.

Third is jerk.

[dayglored]

> First derivative is velocity. Second is acceleration. Third is jerk.

Well done! I did have it explained to my forgetful self upthread a bit... this is SO embarrassing, as I know I learned and used the term in my college courses (physics major), but all it does now is ring a faint bell. And to think that I used to revel in mechanics... well, it WAS the early 70's -- I suppose there's a reason I don't remember it better.

Well, thank you for both your patient explanation and your excellent joke! A very Happy New Year to you and ctdonath2.

[Drago]

Hmmmm...”performance” seems fine to me (almost 2x speed vs. iPhone 6): http://browser.primatelabs.com/ios-benchmarks

[aMorePerfectUnion]

“Oh, btw, both Vista and Win8 had more sales than any version of iPhone. Windows still continues”

You’re not a businessman, are you?

[adorno]

You’re not a businessman, are you?

No, but I played one on TV. ;)

However, you are the one with the reading problem, or the comprehension problem.

Go back and re-read my post. I stated that both Vista and Windows 8 sold more "COPIES" than any iPhone version. Notice that 'copies' is not the same as amount of revenue or profits earned.

I'm not in business right now, but, you must've failed reading comprehension in school. Which is worse?

[aMorePerfectUnion]

“Go back and re-read my post. I stated that both Vista and Windows 8 sold more “COPIES” than any iPhone version. Notice that ‘copies’ is not the same as amount of revenue or profits earned.”

Have you not read that many run a race, but only one wins?

Winning for a business isn’t copies.

Winning for any business is profits.

Apple is a business vacuuming up the vast majority of profits in the smartphone industry.

[bolobaby]

When I suggested that the iPhone 6 and 6 Plus sales bump would be temporary months and months ago, I was told I was absolutely insane and had no business sense. I basically posited that iPhone finally caught up with the other phone makers’ big screen designs. After the initial rush of replacements by iPhone users who had to wait and wait for Apple to catch up, the interest would die down.

And it did. Hm.

Here’s another prediction: Samsung will see lower demand, too. Why? They’ve decided to be just like Apple. I decided it was time to upgrade and went to look at the new Samsung phablets. Turns out, they got rid of the removable back/battery and microSD card support. I immediately picked up an LG Vizio instead. I need/want that removable battery. I think the decision to dump that will hurt Samsung.

[adorno]

Winning for a business isn’t copies.

Winning for any business is profits.

You're still having a huge problem understanding what you read or what I wrote.

I made it a point to mention that what I was referring to, is the number of copies 'sold'. Not the amount of profits generated from those copies. Any dope nowadays would rather sell just one copy of an item that generates a million dollars in profits, than selling a million copies to generate the same million dollars or less. It's common sense and good business practice.

You insist on prolonging an argument which isn't anywhere within my comments.

Apple has been raking in the dough with its iPhone, and nobody will argue that it isn't a productive product as far as generating revenue.

Windows is a generator of profits too, but, at a small scale per copy. 1.5 billion copies of Windows will generate a lot of revenue; not from sales of those copies, but from the potential after-market sales of other services and products and software and content, etc.

There may come a time when the iPhone doesn't generate as much in profit per device as in the last 8 years that it's been around. The profit margin per device may eventually come down to resemble the same low margin that the rest of the industry enjoys, and that would spell disaster for Apple and for its investors.

Android devices are low profit items, if they generate any profits at all. But, the Android ecosystem for Google and others is not dependent on the profit per device. It's about selling in volumes in order to make the profits in the back-end, like with advertising. If Apple's devices become less profitable, Apple will be left with a low number of users, though still significant. But, that lower number of users would not be able to generate the same amount of revenue from after-market sales, as the Android ecosystem or the Windows ecosystem.

Expecting that Apple will forever be able to count on the high-margin profits, is foolish and not good business. Apple needs other products and services, and counting on iPhones for about 70 percent of revenue, is, again, not good business proactive. Apple needs to diversify, and I think they're trying, while understanding that the iPhone can't carry them forever.

And, again, I just mentioned number of copies, not the amount of profits. Entiende?

[aMorePerfectUnion]

“Windows is a generator of profits too, but, at a small scale per copy. 1.5 billion copies of Windows will generate a lot of revenue; not from sales of those copies, but from the potential after-market sales of other services and products and software and content, etc.”

Apple generates a huge amount of money in its ecosystem of the app store, itunes, and subsequent technology upgrades from small devices to Apple computers.

“There may come a time when the iPhone doesn’t generate as much in profit per device as in the last 8 years that it’s been around. The profit margin per device may eventually come down to resemble the same low margin that the rest of the industry enjoys, and that would spell disaster for Apple and for its investors.”

Doubtful... but all markets mature. The issue for every company is the future, while maximizing the present.

“Android devices are low profit items, if they generate any profits at all. But, the Android ecosystem for Google and others is not dependent on the profit per device. It’s about selling in volumes in order to make the profits in the back-end, like with advertising.”

As Apple does in its ecosystem and advertising also.

“If Apple’s devices become less profitable, Apple will be left with a low number of users, though still significant.”

Affluent users are better than low income users, no matter what happens to the smart phone market.

“But, that lower number of users would not be able to generate the same amount of revenue from after-market sales, as the Android ecosystem or the Windows ecosystem.”

It remains to be seen what Android will generate. So far, few Android phone manufactures have more than an expensive hobby.

“Expecting that Apple will forever be able to count on the high-margin profits, is foolish and not good business. “

I’m not sure who is doing that. It appears to be your private straw man.

“Apple needs other products and services, and counting on iPhones for about 70 percent of revenue, is, again, not good business proactive.”

You are assuming they are “counting on it.” Is this simply your opinion, or do you have a statement from the company that their strategy is to just “count” on identical revenues to roll on? I think you are making up this straw man.

Prove me wrong with evidence that Apple shares this strategy with your straw man. Surely you must have read an article, private company memo, etc., that you can show us.

“Apple needs to diversify, and I think they’re trying, while understanding that the iPhone can’t carry them forever.”

Better. Now back to your straw man.

“And, again, I just mentioned number of copies, not the amount of profits. Entiende? “

I have heard your “copy” argument. I reject it. It is meaningless and depends on your straw man coming to life, which remains to be seen.

You might as well throw in a mention stars and fairy dust. Copies is unimportant. Businesses don’t exist to ‘make copies.’ This is at best a spurious argument you continue to put forth.

Show me the money. Not the copies.

[Mr. Jeeves]

If Apple wants customers to buy a new phone every year then they had better start pressing the major telecoms hard to offer one-year contracts.

[central_va]

The Apple CEO wants Americans to buy iPhones but insults them by telling Americans they are to lazy and stupid to build them. Good marketing strategy.

[adorno]

Show you the money? How about the facts, as they appear on the ground right now?

Apple is about 70% dependent on iPhones to rake in the revenue and profits.

The other services Apple offers, are dependent on iPhone usage. So, basically, even the ‘iStore’ and iCloud and every other service, is an extension of the iPhone. Take away the iPhones, and the other services collapse. So, iPhone and ‘iServices’ are one and the same; it’s one ecosystem where everything revolves around the iPhone. Were the iPhone to lose its luster, the profits at Apple would drop precipitously. The 12% or so marketshare of the smartphone market that Apple enjoys, would not be enough to produce enough revenue from the ‘iServices’. The Android marketplace doesn’t have to worry about the number of users dropping precipitously, and whatever money is made from the ecosystem won’t be affected.

Apple is its own worst enemy,where they control the whole ecosystem, from hardware to software, and all of that serves to keep the number of users to a relatively low number when compared to Android/Google.

When it comes to your ‘straw man’ references, there aren’t any. The facts speak for themselves. It is you, as a member of the Apple-cult, that prefers to remain in denial about the problems which Apple faces. Throwing the argument back at me, doesn’t change the facts, and the investors and analysts are all asking the same questions that I have.

You remind me of that other cult, namely the Muslim-cult, where nothing that can be said will convince them that, they have a problem with their religion. Your religion is the Apple-cult. Try to get a ‘real’ and ‘normal’ religion.

[aMorePerfectUnion]

I will gladly admit you created a strawman and you hump it’s leg more vigorously than any troll I’ve encountered on FreeRepublic.

It seems you get something meaningful out of your relationship with your strawman. “Not that there’s anything wrong with that.”

Having said that, I’m embarrassed to watch. I’ll close the door so you can carry on. I assume you have his consent...