eXtensions - Thursday 4 May 2017
Cassandra: Fallout from Q2 2017 - Of Course Apple is Doomed
By Graham K. Rogers
A quick look at the summary that all Seeking Alpha articles have showed me that Gary Bourgeault's article was not as bad as the title suggested; but then that may have been the point. People earn money from hits and nothing sells like bad news.
The main worry in this, and several other articles that have appeared is the drop in sales of iPhones year on year. Some, including Tim Cook, think this is because many are waiting for the iPhone 8, but the main reason for this delay is the way news sources have built this up on paper-thin rumours, in much the way they talked the iPhone 7 down before its arrival.
Those weak sales of the iPhone actually were 50.8 million sold compared with 51.4 million the year before. Some companies would kill for 600,000 handsets sold in a quarter, with Apple it spells Doom. No it doesn't, this is headline hit seekers; and some of the lower figure is due to inventory adjustment.
My order of replacement after that (if I was budgeting) would be the AirPods, then an Apple Watch. I would of course also need a Mac, but that is a different matter: I do have a spare Mac mini in my office, so that would be pressed into service and the backups I have (disks and iCloud) would bring me back up to speed in quite a short time.
As I predicted a couple of years back, critics are finally beginning to see the sense behind Apple services. The Q2 report showed that these produced $7 billion revenue, up by 18% year over year. Edison Investment Research refer to this as "a new normal of pedestrian growth" for Apple, but then the article mentions better sales of Macs and iPads (4.2 million and 8.9 million respectively), services (as above), but misses the wearables sector which is seeing some interest.
Two comments in particular have just the right amount of bite: "Apple Watch alone would be a Fortune 500 company" (Dediu); and "Since nobody downloads apps App Store revenue grew 40% y-o-y" (Dediu). In another tweet, Horace Dediu also noted that "Apple's cash pile is now bigger than the GDP of a hypothetical country where comparing stocks and flows is perfectly fine" (Dediu). I would rather trust Horace than all the sages of Seeking Alpha.
Not everyone was happy, however, and there are still particular rumbles about the lack of new products. There was snarky comment about this at the end of one MacDaily New item, but that site (good as it is as a resource) has never seemed comfortable with Tim Cook as CEO; at one time joining the chorus for his replacement on rather thin evidence.
However, when you lose commentators like Bryan Chaffin, there is more to the dearth of products. I mean I am uncomfortable with the lack of updates to iPad Pro, Mac mini, iMac and other models. Chaffin complains about Tim Cook: show me the money. Show me some products.
With an Apple car (or at least the control system) in the works, rumours of a new Siri device that has been likened to Amazon Alexa, and WWDC just down the road when several clues will be dropped about the real capabilities of the next iPhone, expect some excitement in the next few months.
And for locals, it is strongly rumoured that, with some of the hoardings being removed, Apple's delayed Singapore Store may open this weekend. Don't hold your breath for a Bangkok Apple Store.
Graham K. Rogers teaches at the Faculty of Engineering, Mahidol University in Thailand. He wrote in the Bangkok Post, Database supplement on IT subjects. For the last seven years of Database he wrote a column on Apple and Macs. After 3 years writing a column in the Life supplement, he is now no longer associated with the Bangkok Post. He can be followed on Twitter (@extensions_th)
For further information, e-mail to
Back to Home Page