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> I feel like it's a cultural thing. I don't think culture has much to do with it. Apple's market cap is over $1 trillion. They sold over 40M iPhones last qua
by achompas 8y ago
> I feel like it's a cultural thing.
I don't think culture has much to do with it.
Apple's market cap is over $1 trillion. They sold over 40M iPhones last quarter. They have way more data than either of us do, and the market has spoken: there is not enough demand for small phones to justify a separate SKU.
(Also, as a fellow strap-hanger for 6 years, I just shoved my phone in my pocket and listened to podcasts while riding. But I know everyone has a different use case!)
EDIT: Folks complain on one end about Apple’s lack of product focus and on the other end about cutting out SKUs that do not make sense at their enormous scale.
As much as you all love the SE, it went untouched for years at a time. I imagine there were no components that made sense for the smaller SKU as Apple transitioned to larger phones (and batteries, crucially). It is also a low-ASP phone to begin with, which makes less sense for a company who increasingly makes “luxury” tech products.
- MagnumOpus 8y agoApple would sell millions of the SE2 without cannibalising sales. Every other phone manufacturer would salivate at this opportunity, especially at 100%+ margins. "Not enough" smacks of a lackluster excuse of an adhd department head.
- cschep 8y agoYou have absolutely no idea if any of this is true and you risk nothing saying it. It sure sounds nice though.. :) Making things at the scale that Apple makes them is hard. If the SE was a great business idea, Apple would keep doing it. Maybe they will make another one in the Spring. It's not dead dead yet.
- derefr 8y agoMy understanding is that the SE is made out of leftovers—not in a micro sense of things literally left sitting on the factory floor, but rather in a macro sense: they're made from the tail ends of multi-year component supply contracts, where Apple is obligated to take receipt of components that no longer feed into any current product they're building. They're a "bone broth", a way to use up those tailings and make a profit (however slight) off of them. This was also true, ten years ago, of the iPod Touch. It was the reason for the iPhone 5C. It's at least partially the reason for the iPhone XR today. It's also the reason Apple keeps selling the iPhone 7 and 8. The problem (for consumers) is that, eventually, you run out of the tailings you were using to make one of these "byproducts", since you never signed on to produce more of them. (That being rather the point of the whole process, from Apple's perspective.) Once the supply contract for iPhone 5S "chassis" components is run through, that'll likely be the end of that form-factor. No device Apple has produced since then has that form factor, so there are no hand-me-down components to repurpose into a new device of that form-factor.
- zaroth 8y agoWhat does 100%+ margins mean?
- erikpukinskis 8y agoThey probably mean it costs less than $175 to make and they sell it for $349.
- rockinghigh 8y agoThat’s a gross margin of 50%.
- r0fl 8y agoThey would however hurt the quarterly profit numbers. The SE costs less and the profit margin of ~38% on $800 is less than ~38% on $1000+ It’s just business Apple will probably sell 70,000,000 in 90 days this quarter. I think they know how to sell a lot of phones
- m1sta_ 8y agoThe wins that define Apple didn't come from the market analysis approach you're referring to.
- achompas 8y agoCan you elaborate?
- jazzdev 8y agoIt think it means that some of Apple's wins came from building something no one knew they wanted. So no amount of market research would have led to it.
- m1sta_ 8y agohttps://www.goodreads.com/quotes/988332-some-people-say-give-the-customers-what-they-want-but https://www.goodreads.com/quotes/988332-some-people-say-give...
- ianai 8y agoThey released the SE, originally, because there was enough demand for it. They said pretty much exactly that in the announcement of it. That demand clearly still exists.
- achompas 8y agoDoes that demand exist at a scale that makes sense for a $1T company with many rapidly-growing product lines and high product margin expectations, though?
- abraham_lincoln 8y agoYes. Guess how much a 128GB SE goes for now, if you can even get one?
- ianai 8y agoTo add to this, the SE represented 8% of their iPhone sales so far this year. https://www.statista.com/statistics/804398/us-iphone-sales-by-model/ https://www.statista.com/statistics/804398/us-iphone-sales-b...
- mgkimsal 8y agothey don't actually know the demand for all these new iphone Xx models. it's an educated guess. and... to some degree, a portion of the market will go wherever apple suggests they go anyway. apple got caught 'behind' in the 'bigger phone size' competition, and it seems they'll keep going bigger. you could keep the 'high margin' on an se-sized phone - people would buy it anyway, because they want that size.
- megaremote 8y agoNothing is clear at all, just because you want it to be true.
- ianai 8y agohttps://www.statista.com/statistics/804398/us-iphone-sales-by-model/ https://www.statista.com/statistics/804398/us-iphone-sales-b...
- roenxi 8y agoObviously it is for Apple to decide who Apple's customers are. It is just really sad to have something that works so well for me that no longer exists. I won't buy a large phone, which in 2011 meant I could buy the best phone on the market and in 2018 means I'm facing a future with some phone that just doesn't match a 2011 iPhone in looks, style and maybe even functionality and objective quality. I'm sure they have great reasons, but it is very tempting to wave a fist in the sky and yell "why do they have to keep changing things?". The Apple ecosystem was great for me, and now I'm being forced out. It is like watching open source projects try to nuke themselves out of existence with the Big Trendy Rewrite; except Apple is wildly profitable and successful.
- AlexandrB 8y ago> They have way more data than either of us do, and the market has spoken: there is not enough demand for small phones to justify a separate SKU. Let's not pretend this is some natural result of "the market". The UX of most iOS apps, including Apple's, has been steadily getting bloated with bigger buttons, bigger labels, more padding in text fields, and reams of whitespace. This is personally annoying, but manageable on the bigger, newer phones. On iPhone SE it means that many apps can be maddening to use - with only a little bit of content visible on screen in some situations. iOS 7 on the iPhone 5 form factor was great. iOS 12, not so much. Apple clearly sees no future for the smaller phones and their UI designers consider them an afterthought. It's little wonder that only diehards are willing to put up with this kind of UX compromise.
- erikpukinskis 8y agoI moatly use mobile web, and maybe 2 screens of common apps. The SE works great for me. Every now and then something is a bit off, but I’ll just ditch the rare site/app that doesn’t work right. There’s plenty to do in this life.
- AlexandrB 8y agoI'm specifically thinking of the Music and Messages apps which show very little content while typing a search or message. It's hard to reply to a set of text messages when it feels like you're reading them through a keyhole and typing anything scrolls you back down to the bottom. Music is just as bad and shows ~1 result while the keyboard is up during search.