Lefsetz: 10th Anniversary iPhone 8

Tech is about utility, not fashion…

And there’s no breakthrough coming, other than a curved screen.

You needed a new phone when they went from 3G to LTE.

You needed a new phone when they increased the screen size.

You no longer need a new phone, especially since the carriers have stopped subsidizing the purchase, now that the true cost is evident.

People drive their cars ever-longer, but analysts believe consumers are all gonna fork over a thousand bucks for a fashion statement?

Not gonna happen.

Otherwise, 3-D TV would have been a juggernaut and you’d be throwing away your present flat screen for one with 4k.

Not that Apple isn’t powerful.

While the fanboys cheered on ever more expensive and less unique products, all power was consolidated in the four horsemen – Apple, Google, Amazon and Facebook.

That’s the story here, not the iPhone.

With a beachhead in tech you can get ever-bigger. Hell, Facebook bought Instagram, never mind WhatsApp, and it looks like Snapchat is gonna struggle. Maybe not, but going it alone is nearly impossible these days, because of deep pockets and network effects.

Apple is a giant network with people inured to their ecosystem.

That’s the power of the company, not some me-too, gussied-up new phone.

How much does it cost to switch? Hell, a friend of mine just got a new 7 Plus. Transferring photos was a nightmare, because he’s on WINDOWS! Yup, you want to be an all Mac all the time person, all Apple or all Android. Not because one device is superior to another, but because you don’t want to waste your life trying to make your devices work, especially in a world where they all speak to each other and one in which there’s very little tech help.

So Apple will report its numbers today. They won’t be terrible and they won’t be great. It’s like a new Air Supply album. Only that band can still tour decades on with the same songs and no one will want anything Apple sells today that far in the future.

And the stock went up and if you read the newspaper you’ll learn that the Cupertino company is a juggernaut.

But it’s not.

Let’s not focus on the stock split and what the increase in share price really is. Let’s just say that that the only thing Apple has got going for it is its ecosystem. I just paid four grand for a laptop that’s good, with a ridiculous touch bar that no one who knows how to touch-type, who could afford a machine like this, would ever use. They admitted the MacBook Pro was a failure and the Apple Watch is about as important as Apple TV – which was overrun by also-rans.

So if you believe in Apple you’re sheerly looking at the numbers. That giant cash hoard.

And if you were looking to the future you wouldn’t be worrying about that blip on the radar screen known as the iPhone 8, but what breakthrough is coming down the line, what will cement people’s loyalty to the Apple ecosystem and get them to spend more bucks on hardware in a world where you lay down ever less frequently.

Your computer is good enough, your phone is good enough, your tablet is good enough, which is why iPad sales have tanked. Where’s the runway?

The internet is all about monopolies. When Apple was niche, even after Steve Jobs came back, it was an interesting little company. But it wasn’t until the iPod that revenue soared.

Amazon has got a monopoly on retail.

Google has got a monopoly on search.

Facebook has a near-monopoly on social networks.

What’s Apple’s monopoly again?

P.S. It’s been five years, as David Bowie once sang, since Jobs’s death, name the breakthrough under Tim Cook.

P.P.S. Good is good enough, that’s why the world is on Android, this is Clayton Christensen 101, it’s why Windows 95 almost killed the Mac. Apple needs a great leap forward.

P.P.P.S. People will overspend for breakthrough items. Exhibit A, Tesla. Proving that people will buy a product from a company with no track record in that sphere.

P.P.P.P.S. Juggernauts are about belonging, can you say Beats headphones? A mediocre product Jimmy Iovine willed cool?

P.P.P.P.P.S. Services, schmervices. You’ll hear talk about this tomorrow, Apple Music, storage, but the number isn’t big enough to matter.

P.P.P.P.P.P.S. The cash hoard. They’re afraid to spend it, they don’t know what to buy, they’re afraid of the stock stalling. Really, Apple is little different from AT&T and Verizon, forces of nature that hit a wall when the market became saturated.

P.P.P.P.P.P.P.S. All of the above is long term. In the short term Apple is okay, but history tells us tech companies crater overnight. When will that be? In order to avoid this fate Apple must spend its cash hoard, to compete with Amazon, Facebook and Google. They must buy market share/influence, because based on Ping they sure don’t know how to invent anymore.

Finally… Of course the iPhone 8 will sell well at first, there are always early adopters who want to parade the latest device, but then what?

Remember the Mac? Launched in 1984 to great fanfare, then it sold well for about a minute. Even the record business has learned it’s not about first week sales, but sustained listening.

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7 Responses to Lefsetz: 10th Anniversary iPhone 8

  1. Kerouac says:

    “Tech is about utility, not fashion…”

    – Koala has hated Qantas for about half a decade now…

    https://www.youtube.com/watch?v=P03aam-9tv0

    Kerouac still: being up to date & in style is no way to go through life…

    “People drive their cars ever-longer”

    – now ‘young at heart’, that’s another matter entirely. My garage, 1967, 1968, 1969 & 1970 model year automobiles happily reside – all in great condition, still going strong (apologies new & was new but now used ‘high pressure vehicle salesmen’ everywhere.)

    Kerouac has no need amenities a cell for to text or a built-in tv set to watch during the throes be modern day driving – a back road, an hi-po and a full tank will suffice nicely.
    Improved aerodynamics, fuel efficiency, plastics overload and safety features: airbags? Hell, the impact alone vintage steel and chrome will kill me – a ‘bodybag’ should come as standard equipment on a vehicle. Live fast (Kerouac’s case ‘drive’), die young (afore technology invents a new way save/keep you ’round) and leave a mangled corpse.

    GPS? Who needs it. The young, the helpless and the lost. A 30-something observed Kerouac’s Rand McNally road map not too long ago – “what’s that?” When informed said was all one needed, pursue point B, exclaimed – “Nobody uses those any more.” To which Kerouac added, ‘nor their head, appears… here’s looking at you, kid.’ How did regular folk & delivery drivers same ever find what they were looking for/where they were going sans a GPS, years ago? And what happens, when your GPS breaks? Are you familiar with that older technology called ‘reading a road sign’? Blank stare, century 21 the 30-something.

    “Apple, Google, Amazon and Facebook. That’s the story here”

    – sorry…

    “not the iPhone.”

    – right-o! Not on my watch…

    “but”

    – yes?

    “analysts believe consumers are all gonna fork over a thousand bucks for a fashion statement? Not gonna happen. Otherwise, 3-D TV would have been a juggernaut and you’d be throwing away your present flat screen for one with 4k.”

    – my idea technology: the move away from cd and back to lp. I miss telephone booths too… and phone books. A rotary telephone still lingers house of Kerouac, sight which lead the 30-something to inquire “What’s that?” ‘Do you like to party?’ I asked. “Sure!” ‘THAT was what we meant when we said “we had a party line”, back in the day.’

    More blank stares, century 21, the 30-something.

    “Your computer is good enough”

    – ✓ and the battery (old tech/low tech) seems to last forever…

    “your phone is good enough”

    – ✓ a black 1950’s office style…

    “your tablet is good enough”

    – ✓ Big Chief Red, unmarked its original packaging 1962 (and doggone it, people like me!)

    “the iPhone 8 will sell well at first, there are always early adopters who want to parade the latest device, but then what?”

    – it will probably catch on fire/burst into flames. That’s what happened recently some other new phone thingamajig.

    Technology… zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz

    “Remember the Mac?”

    – yeah, that big cheater… McGwire used that androstenedione drug (an steroid-based hormone) then his home run totals as his body/head swelled up. Some dared to call it ‘progress’…others ‘conspiracy’. Then he started breaking down, and retired from MLB a broken man and body, still 131 home runs shy Ruth (who was powered by some’ old technology’): beers, brats and babes.

    I hate modern sports… and technology. Only thing that seems useful this computer: replaces a typewriter, file cabinet & snail mail…that it causes eye strain & ergonomic stress? The price of progress.

  2. Bad Hombre says:

    I’m just waiting for Pied Piper to finally launch their new internet utilizing middle out compression.

    This could be huge!

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