MONSTROUS iPhone sales are CANNIBALIZING iPads, gabbles Apple CEO Apple countered soaring iPhone and Mac sales with yet another doleful quarter for the iPad in its second quarter of fiscal year 2015. The Cupertino giant logged Q2 revenues of US$58bn (£38bn, AU$73.9bn), up 27 per cent over US$45.6bn in the same period last year. Earnings per share (non-GAAP diluted) of US$2.33 beat analyst …
Give it another year, these are the 1 thing that Apple sells that really is beyond "Peak", and not just for Apple. I suspect they will move on and find their niche in some field or another. However, due to the fact they usually require 2 hands to hold, this field might not be big enough for Apple (or so Apple might think). If you really, really, really want one you can find them flogged on Craigslist or what not. The one thing they have in common second hand is that regardless if they're stolen or not, they all seem to chuck for ~$150us, which is or isn't a good thing depending on your view (Did the stolen ones drive down the price for all of them? But how can I tell if it's stolen?).
I can't be bothered with the gimmick. Sure they have their purpose, but like I stated they require 2 hands to hold (feels like work to me, but maybe that's their only viable purpose left).
@ MyBackDoor
The iPad Air weighs less than a pound, and fits quite comfortably in my left hand while I poke and prod it with my right (as I am doing it right now). You must have exceedingly small hands or, at minimum, weak wrists. My condolences – although you were clearly correct back when the original chunky iPad was released, seeing as how it was more than a bit of a piggy.
And you've gotta love The Reg's long-standing, horse-blinder-wearing anti-Apple bias: the company releases quite stunning numbers, and The Reg leads this story with what's arguably the only negative to be found in the Q2 financial report.
Oh, and remember The Reg's "Peak Apple" misstatements of a couple of years back? Still waiting for a retraction…
@Rik:
"And you've gotta love The Reg's long-standing, horse-blinder-wearing anti-Apple bias:"
You mean how El Reg always treated Apple exactly the same as they treated all other IT mobs, and yet Apple punished them by removing all access to press conferences, press releases, call backs for article clarification and the like?
El Reg started off being openly skeptical about all of the advertising claims made, and for not openly worshipping at the Sphincter of Jobs, Apple decided to "punish" them. Of course, such blatently perverse behaviour by the Cupertino Cultists only lead to what El Reg does best, openly mocking the company, product, patents, and the fanbois who refuse to admit that their beloved iCon can be just as flawed as the cheaper competitors they claim to have superiority over.
But hey, you want to wear the blinkers and remain in the Jobsian Walled Garden, good for you. Just remember that for all of the mocking Apple fanbois make of Microsoft copying Apple products, Apple is now following the Microsoft business model of locking people in. Once you finally manage to wrench the blinkers off your nonce, you might start to smell the hypocrisy. It smells something like what is used to fertilise the walled garden.
@ MrDamage
Dude, dude, dude ... chill, chill, chill.
It's entirely possible for reasonable people to disagree about corporate tactics — damn, let's talk BP. But it's counter-productive to a) immediately look for the worst possible analyses of otherwise sterling financial reports, 2) employ jejune ad hominem attacks such as "openly worshipping at the Sphincter of Jobs," or iii) dismiss such blatantly ill-informed and click-baiting Reg mis-analyses as "Peak Apple." Those all prove that their proponents are possibly more interested in splenetic ejaculations than reasoned argument.
And, yeah, I was one of the Reg editors "punished" by Apple for Reg over-reaching after covering them in adversarial and complimentary relationships for about, oh, 20 years. The appropriate reaction to Apple's anti-Reg silliness was to be consistently fair, analytical, and careful in my reporting — not to go, "Well, fuck you, assholes!" as you Anti–Cupertino Cultists (just rephrasing, just rephrasing) seem to advise. Doesn't work — and, dare I project, wouldn't/won't work with you.
Let's all just calm down and deal in emotion-drained facts, eh? Just a suggestion...
...because it ruins the registers credibility, that's why. Apple have performed spectacularly well throughout this entire period. Eventually they will falter, but it just makes the Reg look pathetic, and we know that this is one of the few places where you can still find journalism.
At some point peak Apple will be right, so will Apple's demise. Nothing is more certain. Not even death.
The problem is I can be just as right.i don't want to hear how Apple will fail, nor MS nor Google., Sony or anyone else. In the end each of them *will* fail. I guarantee it!
I want to read some insight not the bleedin' obvious all the time!
Commentards can rant either way, that's what commentards do and damned right because we're not paid, just passionate. But paid journalists?
@CrosscutSaw
The reason that iPads and iOS are suitable for musicians is that because corners were not cut in their development. Latency in iOS has always been very low, and Wireless Midi has been baked in since the first iPhone. The reasons are historical - Apple only survived the nineties by appealing to niche groups - graphic designers requiring colour accuracy, and musicians requiring the low latency of Moto or PowerPC. These areas lead tio FireWire, and it was FireWire that made the first iPod a practical idea.
The point is, someone in the company remembered their recent history and went with it. Someone in Apple thought it would be idiotic to not support muscians, who enjoy a certain standing with young consumers.
Companies put that extra effort in because they wish to get a return on it.
Anyways - before the iPad, dedicated DAW control surfaces cost silly money because they were made in hundreds or thousands. The iPad did more, did it better and coast half as much - because it was made in the millions.,
"The reason that iPads and iOS are suitable for musicians is that because corners were not cut in their development."
Actually they were, iOS is basically a port of OS X. Luckily corners were not cut in OS X until about Lion, which coincided with Serlet's departure from Apple.
As for Tim-nice-but-Dim, it seems that he hasn't realised that most that an iFan will need is one Mac, one iPhone, and one iPad.
it seems that he hasn't realised that most that an iFan will need is one Mac, one iPhone, and one iPad.
Don't forget the need to kit out ones significant other, children and household pets with their own window on the world.
Not sure about iEarings, but perhaps I've spent longer than is healthy in Claire's Accessories.
The point of this article is that large iphones are removing the need for ipad for many people. I use my large phone and no pad and many of my friends are starting to do the same despite the initial mockery. Apple are doing well in the large phone category but by copying Samsung who we have to thank for their vision in providing the large phone format NOT APPLE. Long may Apple to continue their success but they are riding more on goodwill at the moment. iWatch vanity project for example.
"Riding more on goodwill"? Seems I heard the same arguments eight years ago when everyone laughed at Apple for thinking they could enter the phone market and compete against established players like Nokia, RIM and Microsoft with their own smartphone. They really thought it was funny when Jobs suggested that Apple might someday have 1% of the mobile (not smartphone, mobile) market. They currently have over 10%.
>As for Tim-nice-but-Dim, it seems that he hasn't realised that most that an iFan will need is one Mac, one iPhone, and one iPad.
Not sure about elsewhere but in Oz, the phone plans are skewed so that BYO costs you more than buying a phone on a plan. That means phones are replaced every couple of years when the plans expire and a new plan purchased, whereas tablets are bought and kept. The old phones are handed down to the kids. Essentially you have move to PAYG before keeping your old phone makes sense (at least with Telstra). Telstra have a good (for Telstra at least) PAYG option at the moment. Classic bait-and-switch, but I'll take advantage while I can.
"This is great, maybe the iPads will come down to some good prices and some of us who object to buying that stuff can grab one for our needs, like certain musician software that only works in that environment."
Get a Surface Pro. Far better product, and the best music notation software runs on it.
>I suspect iPad lifespan is significantly longer than that of an iPhone due to not being tied to an airtime contract.
A lot of iPads rarely leave their owner's house*. This means that battery life and weight aren't as critical as those of iPhones because they aren't carried as far.
* The Reg reported some study a couple of years back.
>Get a Surface Pro. Far better product, and the best music notation software runs on it.
That depend upon exactly what he wants to use it for. Yeah, the Surface Pro might be better for some, but iPads are very well supported by music software developers, and by hardware peripheral vendors (guitar effects, microphones etc). iPads are also silent in operation - so would be more suitable for displaying sheet music (a pedal can be used to 'turn' pages) in a live performance scenario.
I'm sure that he will look at the pros and cons of both, and make an informed decision. :)
Fair does!
I don't own any Apple devices or APPL stock, but I'm glad they are doing well.
We are technology-using animals. None of us would be here without fire, many of use would soon die without clothing or shelter. Our environments are often full of man-made creations, so a badly created object feels akin to littering.
Now, i remember when the main frustration with a computer was that it wasn't quite fast enough. At that time, it was clear that easiest way to make the thing less irritating was to have a faster CPU and more RAM. Adding these things would clearly make ifor a better user experience. Also, these things would be easy to sell: "66 Mhz, 4Mb RAM, 200 MB HDD, 4x CD ROM, only £999". All of them with the same cheap, sharp-edged stamped mild steel chassis, many if them with a hideous fascia of beige ABS plastic when they could simply have been powder coated. That's mere looks, fine - but these machines insisted on a restart every time a peripheral was added, and this user didn't take that as a friendly trait.
@Dave126 - yes but while those £999 circa 1994 boxes had their faults that's how most of us got started and we are grateful to them.
Why?
Well at the time the Apple boxes were very beige and boxy too (in fact I'd say lumpy) but cost £2999. Plus they were almost dead in the water...
http://www.everymac.com/systems/by_year/macs-released-in-1994.html
We didn't have to worry about bra and knickers not matching as the concept didn't exist then. Ask the wife, it's one of those life's hurdles.
@ jason 7
You're absolutely right - I had my start trying to get games to play on an 8086, and its successors through the nineties! I was also exposed to Archimedes Acorns and later networked (beige) Apple LC-IIIs at school, and to Atari STs by people who had coveted MIDI keyboards.
I fell asleep before I developed my point, which was at that time faster CPUs and more RAM dramatically improve the user experience. Therefore, buyers would buy a new machine on spec against price, and money spent elsewhere was a 'waste' - so PC vendors would naturally put together the best components and sell them in the cheapest box. This meant there wasn't any incentive to make machines with the 'rough edges' taken off.
And that is fine. There is no reason for a company to make machines that are more highly priced than their competitors, unless that they are adding something that helps to sell it. In the PC market at the time, these things would happen but required collaboration from various parties. Therefore, genuinely helpful technologies (Remember when 'Plug and Play' was a selling point? Amiga and Apple already had it) took a little while to filter through.
The disorganised PC market had advantages, though... what became standards tended to start as a propriety solutions to genuine user needs. Lots of sound cards were sold as being 'SoundBlaster-compatible' for example, and later 3D video cards had to convince game developers top develop for their platform.
Sorry, I didn't mean to dodge your pin about 1994 Macs - I used them a lot at school and found them always running out of memory. It is also true I didn't see their price tag!
However, when they weren't displaying a spinning beachball, their sound capabilities were better than my PC, they were all networked and keyboards and mice could be hot-swapped.
Yes, they were beige, but sat unobtrusively below the monitor, and they retained some of the 'snow white' design language originally developed by Frog Design for the Apple IIc (and which Sony would later deliberately pay homage to with the Sony Playstation - Frog Design had also done work for Wega televisions before they bought by Sony.)
The one thing you can say about Apple products is that they (almost) always retain their resale price remarkably well.
I recently sold an iPad 3 (first retina model) for £160 on eBay, and bought an iPad Air (first Air model) for £260 - an actual cost of only £100.
If you examine the iPad ecosystem, I think you will find higher iPad "sales" than you might first think.
The one thing you can say about Apple products is that they (almost) always retain their resale price remarkably well.
Not only that - it's still one of the few companies I know that actually supports trading in a device for a new one against enough money to make it worth your while, and that extends to the resellers as well.
It's your money, and I don't care what you spend it on (I think iPads are fine, but they just don't meet my needs). However, you should know that that line of reasoning is unsound...
2012: buy an iPad for £399
2015: sell same for £160
That's £239 spent on owning the device for three years. However, those 2015 Pounds are not as valuable as the 2012 Pounds you bought it with: like for like, you really only got back £147 of your £399, not £160 (calculator here for UK inflation: http://www.thisismoney.co.uk/money/bills/article-1633409/Historic-inflation-calculator-value-money-changed-1900.html ). Your cost is therefore £252.
If your other option at the time would have cost you £299, but those are now worth only £80, it is actually that one that is "cheaper to own". (a cost over three years of only £220, or £212.50 if inflation is counted).
The "high retained value" myth is repeated over and over again, especially in big-ticket items like new car sales, but there is no such thing as a free lunch: you are paying more, all the way through the lifetime of the product. It just looks like you're not because inflation and lost opportunity aren't obvious.
Please don't take any of this as a criticism of your choice of device. As I said, I think iPads are okay. It's just that they're a bit too expensive for what they offer (to me), and an apparently higher retained value does not make them "cheaper in the long run" - expensive is always expensive.
Basically - the only valid reasons to buy something are because you like it or you need it, and accept that you paid more for an irrational reason (your own pleasure in owning or using the product). No mass-produced good is ever an "investment".
@Brandon 2, I think you're missing Kristian's point. If I understand correctly, should you need a phone and you like the iPhone then that is a valid reason for buying one. What is irrational is choosing the iPhone because you feel it will be more of an investment than choosing another phone because it will be worth more when you sell it. It's irrational in the same way as buying a $100k Mercedes instead of a $25k Ford because at some point in the future the Mercedes may be worth $80k while the Ford may only be worth $5000. Both have lost $20k in value but the Mercedes has also tied up an additional $75k that you could have used to buy something else you might like such as shares of AAPL or if it makes you happy handing out an ice cream cone to everyone in East Kilbride1. The irrational bit pertains to the faulty logic of deciding based on what it will be worth later not the decision to purchase an iPhone or Mercedes itself. If you want one it's fine but don't use the excuse that it's some sort of investment that will be worth more down the road. You might get lucky with the car because maybe for some reason it winds up being one of 300 produced like the 1953 Corvette but as Apple's sales show, that's unlikely to happen to an iPhone.
1. Which is a perfectly rational thing to do if you derive some utility out of it even if the only utility is that it makes you happy.
Yep. That was exactly my point.
If my own pleasure in owning and using something is irrational, what is a rational reason to own something?
Well, anything you actually need. A hammer is a rational purchase if you need to drive nails into something, and you don't have a hammer. But buying a carbon-fibre-handled molybdenum-alloy-headed designer hammer for six times the cost of a regular one is probably not a rational decision: both will drive nails equally well.
I'm not saying irrational purchase are bad, just that we should be a little more honest with ourselves when we're doing it.
No i got an iPhone because the Samsung Galaxy S2 left me with nothing nice to say about Android or Samsung and gave me nothing but pure hatred for the device, which i never had when i owned Nokia phones. Now I'm on my second iPhone and i have nothing but good things to say about them.
In my circle of friends, family and work colleagues, getting highly annoyed with a Samsung Android phone seems to be a common occurrence they all got iPhones because of their bad experiences, not to show off.
You buy Android because it's cheap to buy (not necessarily to own when you factor in longevity and / or resale values) but you buy iPhone if you value quality, service etc. Over 18-24 months there is little difference in cost between a high end Android and iPhone - the iPhone will cost more to buy initially but worth more to trade in. But typically iPhones last longer (whereas most Androids seem to get traded in after 18-24 months) so over 2-3+ years the iPhone is probably a bit cheaper to own.
No, I got an Samsung Galaxy S2 to replace my HTC Desire, and a second one a little later (long story), gave me nothing but pure love for the device, which I also had when I owned Nokia phones. Now I'm on my second S2 and I have nothing but good things to say about them.
In my circle of friends, family and work colleagues, getting highly annoyed with an iPhone seems to be a common occurrence, they all got Androids because of their bad experiences, not to show off.
FIFY
"tablets rarely leave the house so what's the point of spending over the odds on a tablet that no-one will ever see?"
When I was in Edinburgh last June, a number of (what I assume were) Chinese tourists appeared to be using tablets- these definitely weren't mobile phones- to take photographs with.
I must admit I'd wondered why they didn't use smartphones. (*) But then, tablets are possibly better for maps and navigation on holiday, and I don't know if smartphones designed for the Chinese market would work with UK networks anyway.
So, perhaps this doesn't cover most cases, but it does show that people use tablets outside in some cases at least.
(*) The obvious answer- that even the up-and-coming Chinese middle class is still nowhere near as well-off as the average Westerner, and owning a phone *and* a tablet might still be an unaffordable extravagence- holds less water when you consider that those able to travel halfway across the world on holiday are likely significantly richer than average.
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If that were true, how come the iPhone sells so well? The only difference is a radio chip, costing a few dollars at the most, and possibly an LED flash for the camera. Oh and the iPad is 4 times the size, so has a much more expensive screen and battery.
Actually I've used the argument of tablet prices to say that all the top-end phones are over-priced. Which I believe they are, so I won't spend more than £200-£300 on a phone (and there's some pretty good ones at £150).
But the 10" iPad isn't significantly more expensive than the premium Android tablets. Until you pay Apple's rip-off price for extra storage of course. Or in fact the £100 extra they charge for the one with a mobile radio chip costing a few dollars...
I'd say it's more likely that tablets often get left at home, and don't take as much of a hammering as phones, in battery or getting dropped terms. Plus lots of people still expect a shiny new phone with every new mobile contract - whereas they're paying the price of the tablet up-front (not as part of a disguised hire purchase and airtime contract).
How many people buy the iPhone outright compared to being able to spend £35 a month for two+ years?
There is a difference.
I don't know many that shell out £600 (whatever it is) for them. It's just a constant payment scheme.
Not much different to paying £1 a week for the catalogue sofa back in the 1970's.
I have an iPad "3" - I use it every day, I take it with me to work, and play games on it in the evening occasionally.
It still works just fine - sure, it struggles with the frame rate on some of the newer games, but most of the time it does exactly fine - checking my email, updating my calendar, browsing Facebook etc.
Will I replace it? Yes of course. With an iPad? Absolutely. But not yet - I see no reason to upgrade unless the software stops supporting it or it dies a horrible death.
The relentless push for updated models just doesn't apply to me, and I wonder how many other people feel the same way? Perhaps there will be a surge in iPad sales when they all *need* replacing, and then drop back again?
I agree with much of what you say... I have the same generation iPad that you do and it serves it's purpose brilliantly as a casual sofa surfing device, a Netflix viewer for my girlfriend when she is getting ready in the morning and a very occasional gaming device. A few games stutter slightly, but it's the smallest of niggles, and I do quite frequently momentarily wish it had Touch ID when I absent mindedly leave my finger on the home button waiting for it to unlock like my iPhone. I hand off to my mid-2010 MacBook Pro when I need a proper home computer which is maybe a couple of times a week, a device which increasingly shows it's age but continues to serve it's purpose. Both are devices I fully expect to upgrade, but both only on a 5/6 yearly basis unless technical failure happens first or unexpected incredible technical innovation occurs.
My iPhone though, perhaps due to it being used much more than either of these devices and the limited life of lithium ion batteries being more obvious on a device that is outside the home far more frequently, has always been one a 1/2 yearly upgrade cycle and I imagine this will continue. I don't know how typical a customer I am, but I would hazard a guess there are many of me about.
I upgraded when the retina display was introduced - that was a huge improvement.
There hasn't been another improvement large enough for me to upgrade since.
Massively increased battery life would tempt but apart from that there's not much I can think of.
Apple moved 61.7 million handsets on the quarter, accounting for US$40.2bn in revenue.
I've never owned an apple product, and would have absolutely no plans to do so. But fuck me, those are impressive figures, no mistake. I'm forced to tip my hat in the general direction of apple this morning. You chaps are indeed, bad ass money making machines.
I can't find anything newer, but total worldwide revenue in smartphones Q1 2014 was supposedly $72bn, with smartphones having 95% of the total phone revenue. With Apple having $40.2 billion smartphone revenue one year later, that's likely close to half of the total world wide phone revenue.
We prefer iPhones in our household and do own them but they are not worth the £400 premium over some of the cheaper Androids now. The wife bought an iPad and returned it within a week because it was just too big and the gap between a Macbook Pro and iPhone doesn't really need filling with something over £500. The iPad is only worth £199 and the iPad mini £149 to me.
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