Apple Reports Fourth Quarter Results | Hacker News Reader

Apple Reports Fourth Quarter Results

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93 pointshw187 comments

Wow - Services grew 27% year-on-year to $10bn! For comparison, AWS made about $6.8bn in Q3.

That's bananas. And it's more than just Apple Music / iCloud storage; it's the "ecosystem lock-in" and the glue that keeps folks from bouncing away from Apple hardware.

Congrats to the team!

Isn't that increase primarily charging Google more for exclusive search access (e.g. "platform tax")?

http://fortune.com/2018/09/29/google-apple-safari-search-eng...

Apple Music has gotta be a big chunk of the increase. It was at 17 million subscribers in Sep-17 and was at 50 million in May-18 so that's +$1B a quarter right there.

Amazon really missed the boat when they came out with their crappy phone attempt. They could have invested more money and made some decent hardware instead of trying to do something gimmicky. They still haven't really learned though by launching poorly designed Kindle Fires with low res screens that lag a bunch. I wonder how different it would be if Amazon had launched a device like the Pixel as a phone.

Maybe, and this is just a guess, making good hardware isn't actually that easy? Did they hire any pros or did they try to build the knowhow internally?

It really is easy, comparatively speaking with the current Shenzhen ecosystem.

The problem with Amazon is exactly the same as Microsoft had in the 90s. They have no taste, and not in a small way but very big ways.

Services story is amazing. An area Apple could grow is host backend services for the 2M+ app developers out there.

iPhone sales account for just 59% of overall revenue now. That's impressive figure the way Apple is diversifying its business from Hardware-focused to now Services-focused. By comparison, Google Search still accounts for around 86% of its revenues. Well done, Apple!

It depends on what counts as services...

"Congrats to the team" for their effective "ecosystem lock-in"?

Congrats to them for effecting a 30% tax?

"Please sir, may I have another?"

Congrats for actually creating an ecosystem worth using.

...for some people, for some ends.

Yeah, we get it, people who don't use Apple products exist. Not particularly relevant to the discussion though.

It’s still worth noting that apple does not meet every need if people are making carte blanche value statements.

Very true. The comment that started this branch just derailed the conversation by mocking apple developers/users, but if phrased as the first part of your statement, could have been useful discourse.

I think the conversation was derailed plenty by offering congratulations to people for successfully making money.

Yes, I'm long AAPL.

Some pretty good charts here: https://sixcolors.com/post/2018/11/reminder-apple-financial-...

Interested to see Asymco's take. He was super close on the vast majority of his predictions for this quarter according to his Twitter account (https://twitter.com/asymco).

Q1 looks like it's going to be bananas, especially with iPhone XR, new iPad Pros, new Macs, etc.

Did he only include his prediction with the announced numbers?

In general, if you do not want to release your numbers early, you can just tweet a signature or HMAC or even just a SHA-256 digest of your summarized predictions (in plaintext).

An interesting counterpoint is that the stock is down ~5% in after hours trading on weak Q1 guidance. Apple’s guidance is always pretty conservative though, and the market hasn’t gotten used to it.

The market isn't always very intelligent - these are absolutely incredible numbers IMO

The market is reacting to the announcement that Apple will no longer break out unit sales. Analysts hate having less information, and (rightfully, IMO) see it as a sign that sales growth is over.

*unit sales growth

What's up with them no longer reporting units going forward?

Did anyone catch on the call whether they will still report revenue and ASP by product? If so, can't we get units by taking revenue/ASP?

If not... holy cow, they just became a whole lot more opaque. Revenue by product line seems extremely important in making an investment decision.

The numbers aren’t going to grow much, they’re close to saturation in the market.

They probably don’t want to deal with all the ‘iPhone only grew 2% this year!!!!’ stories.

If you don’t report numbers people can’t use your numbers against you.

I don't think they disclose revenue per SKU (e.g. XS, XS Max XR) - you would need sales by SKU / ASP to get unit sales

Of course.

But will they say “$xx billion iPhone revenue, $y billion iPad revenue, $z billion Mac revenue” or “$(xx+y+z) products revenue” next quarter?

They will still disclose sales by device segment

They haven’t. People try to reverse engineer it from the ASP of all models combined.

Tim knows what he’s doing, keeping the Mac prices a couple hundred dollars higher than we’d like.

Mac and iPhone prices will always be about perceived value. Unfortunately they don't have enough competition to drive prices down and they will take advantage of that for as long as they can.

Some tried from different angles but it seems people just don't feel confident enough to leave the ecosystem. Google keeps pushing sub-par phones. No one has delivered a robust face recognition tech as good as Face ID. Screen and camera quality are almost there but never better in a distinctive manner.

In fact, no one is trying to compete with Apple anymore. Android manufacturers abandoned the high-end market. The tablet and smartwatch markets are pretty much dominated by iPad and Apple Watch.

And as the service category expansion shows, people are getting comfortable with the idea of paying a monthly price for good tech. If competition eventually becomes a problem, they can just start bundling things up like Amazon does: iPhone Upgrade Plan + Apple Music + Cloud Storage + Apple Care + (eventual) TV content.

>In fact, no one is trying to compete with Apple anymore. Android manufacturers abandoned the high-end market.

You'll need to convince me that the Note 9 is not a high end phone.

Using one will do that for you.

Just kidding, never used one, I’m sure it’s a fine device. But Apple has managed to dominate the high end smartphone market for over a decade and they don’t seem to be losing much ground there. Pretty amazing testament to the power of focus. Literally all their competitors have smartphones as a small piece of their business and it shows.

I have an iPhone and a OnePlus which cost half the price. The OnePlus's face recognition is not only faster to unlock but is more reliable.

This side of the Atlantic I see Android tablets everywhere, specially outside of the 1st tier EU countries.

He knows they can charge anything. When the iPhone X dropped at $999, even as a total iOS person with the money to afford it I scoffed. But I knew they would sell like crazy. Apple has a brand beyond any company's wildest imaginations. It could be $2k and people would still want the latest iPhone no matter what, if not just to be seen with it.

I scoffed at that price too and then realized that I spend more money on way stupider things regularly. My phone is something that I use literally every single day. If I want to continue using it, then I need to pay the price they're asking. So far, I haven't upgraded because my iPhone 7 continues to be a great daily driver. I'm tempted by things on the iPhone XS but not enough to make the jump. Once I do, though, I firmly believe that it'll be worth that price tag. I can genuinely say that I haven't had an Apple product that, in the end, didn't live up to the cost I paid for it and then some. It's the one reason I haven't left the ecosystem (even though I own an Android phone for dev work and a PC for gaming).

If the price ever outweighs the utility, I'll just stop buying Apple. There's nothing that's that important that would keep me locked in. If a comparable Android phone comes out that works as well as my iPhone, I'll jump ship but only because the extra cost in no way outweighs what I've spent in iOS apps. I'm not going to keep putting money into something that doesn't work for me. I don't get the people that are just brand loyalists for the sake of brand loyalty. I like Apple products because they're the best for me. Why is that weird for some people?

"I can genuinely say that I haven't had an Apple product that, in the end, didn't live up to the cost I paid for it and then some."

I think this really hits the nail on the head. Granted, this is all anecdotal, and for every positive story I'm sure there is a negative one, and we'll never really have these statistics, but I'd kill to know what percentage of long term Apple users feel this way about their products vs users of other companies. Not counting the Apple II's inherited from my stepdad as a kid, I've had a clamshell iBook that I ran Debian on in high school, a ~2008 Mac Mini that I developed my first iOS game on, an iPhone 3G, 4S, 5S, 7+, a ~2010 and a ~2014 Mac Mini at work, and my 2016 MBP, and every single one is either still in use, or was used basically to obsolescence.

FWIW, I don't use the entirety of the ecosystem by any means. I literally don't use iCloud, Apple Music, Siri, and probably a myriad of other tech they offer. And yet, I still get an enormous amount of value out of each product I purchase from them.

Full disclosure, I was primarily an iOS dev from 2011-2015, and at least 50% of what I do now is still iOS development.

I had the lowest tier macbook for 7-8 years (upgraded RAM and HD to SSD). Replaced it with a macbook pro from Ebay, which I found for $400 (Was a fluke, it had ubuntu on it and I think that confused people), which I've now had for 5 years. I still rock an iPhone 5 (never had a case either). Apple products definitely last for me.

Agreed. My entire family now has Apple products because I hand them down when I buy the newer models. I'm sure I could sell most of them and get some of my money back but it's worth it to me in both cost and hassle to just give my family the old stuff since I know it's both good and really simple to use for them. With family sharing and all the other good stuff, it's the easiest my IT work I've done. lol

I certainly don't care about being seen with a cool phone, but for somebody like me who doesn't want Google tracking my every move, I don't see any alternative to iPhones. So yes, they can charge whatever they want and I don't have a choice.

Also, I factor my phone purchases as a per year cost. Apple is still supporting the iPhone 5s. I only have to replace Apple devices every 5 years. At that rate it's about $250 per year, which is better than any high end Android phone. Privacy is the main reason I get iOS devices, but the price is not bad.

Yup, I'll have had my 6S Plus for 3 years in December. With a new battery and the new OS it's still a very high end experience. 6S Plus was when they added optical image stabilization, so the camera is still pretty good too. Cost $1k brand new then and I'll probably drop the same $$ or more for a maxed out iPhone whatever in Dec 2019.

If only their laptops were this high quality.

I'm still working (happily) from my maxed out 2012 11" Air. I put a new battery in it earlier this year and upgraded the SSD last year. You can definitely get longevity out of the laptops. My work undulates between email, text editors, Perl, C#, and whatever I do while SSH'ed into servers. None of that requires much in the way of CPU. Maybe if I was an iOS developer or did some other creative work I'd have a different opinion.

The new Air may be enough for me to upgrade (mostly for the Retina Display), but that's mostly because I can rather than because I need to.

iPhone 6 Plus had optical image stabilization.

I stand corrected.

Of course, you don't have to pay $1K for a new iphone: you can buy a new iPhone SE 32GB for $140 from Walmart (locked to their captive cellular provider for a year, but still). Or refurbed for $70!

You don't think Apple is tracking your every move too?

No, they are not. When customers set up a phone Apple presents clear choices about the use of Location Services, Siri, etc., and various types of tracking can be easily turned on or off at any time in the settings. Most people opt in to some amount of tracking, e.g. for getting map directions, and using the internet inherently involves sending data around, but they are all optional. Applications must explicitly request customer permission at runtime to track location, look at contact info, etc., and Apple takes action against apps which collect customer information without authorization or abuse it.

Both first-party location/data tracking by Google, and underhanded tracking by third-party apps on Android are pervasive, and more difficult to keep tabs on / opt out of.

Of course, the main people tracking your every move with any phone are the phone company, anyone the phone company is selling or providing your data to, and anyone operating a device which can trick your cell modem into connecting to it (“stingrays”).

They're not. You can inspect the network packets being sent from an iPhone (and it's been done) and it doesn't phone home data to Apple outside of iCloud usage and those packets are encrypted.

They are. Worse, you can't even opt out of it. On an Android phone, AGPS data collection is opt in. On iOS, there is no way to turn it off.

On an Android phone, you can set an offline maps app as the default. On iOS, every map link will open in Apple Maps, sending data to Apple in the process. On an Android phone, you can set Signal as your default messaging app. On iOS, any time you click an SMS link, it will open in iMessage, which tells Apple the number you want to SMS and check if that user uses iMessage.

Really, anything Apple has said about privacy has been pure marketing for the easily duped.

Apple actually could charge $2k.

For most people their phone is their only computer, television, ebook reader, camera, watch etc. It's their life. And so if you think your phone delivers you far more value than your car then you can appreciate why Apple is able to push prices up.

But you can get a phone for 3-500 (xiaomi, oneplus) bucks that would be 90% as good. Samsung phones usually have BOGO deal so you can get them for 3-500 as well.

>that would be 90% as good

Maybe to you but I've tried several other phones that are nowhere near that close to Apple. I'd give the best non-Apple phone I've ever used a 70% and even that might be being generous.

A lot of people say what you do, but personally I don't understand that argument.

I'm typing on a $200 Huawei , and on my side there's a $900 iPhone paid by my employer that I can't even get bothered to use. I even switched to the iPhone for 4 weeks while abroad (free data roaming) and just went back to the Huawei when I returned; I just like it more.

I'm in the same boat. I work for a mobile telecoms provider so have my iPhone upgraded for free every 18 months.

I still prefer my personal handset (Honor 10 right now, love it).

The iPhone 8+ is closed and boring to me.

That's fine. That's your preference. No one is saying you can't have a preference. I prefer the iPhone and none of the Android phones that I've tried and used regularly hold a candle to it. The argument was that these less-expensive phones are 90% of the way there and I disagree. I used to like to tinker with phones a lot. Now I just want something that works every time I use it without fuss. There's no phone that's close to where the iPhones are in those terms.

Of course. I'm just saying that for most people their phone is by far their most important and intensively used product they own.

And so if you need a product like that I am sure you would be willing to absorb higher prices. Which is what people are doing.

I always hear that there are issues with Android devices getting the latest security updates, etc since there are manufacturer and carrier dependencies.

Is that still the case or just urban myth at this point?

Cheaper phones rarely get more 2 software updates, and security patches can take years to roll out. This is mainly because manufacturers have no incentive to spend money on patching/updating software that a small number of people use. https://www.statista.com/statistics/271774/share-of-android-... Google is working on a new OS for the pixel which will attempt to solve this fragmented Android issue.

I believe Android has gotten better about pushing security updates, at least to most flagship phones. But they still lag behind on OS updates.

Turns out that last 10% is where the majority of value is created.

Not even sarcastically true. That's why I'd get an Apple, to get some polish. Apple is far from perfect, but the rest is so far behind..

Definitely not the case in rest of the world. US is where iOS is equally dominating as Android. Probably due to social pressure or everyone having an iPhone. Android is still majority overall everywhere else.

Not just the US. iOS is also majority in all the anglosphere countries: uk, canada, australia

Then it has about 70% in japan. Europe is a bit lower, around 30-35%. And then the result of the world is android by a vast margin.

So in all the rich markets, iphone puts in a majority or good showing. Whereas android dominates at lower price points where the iphone doesn't compete.

http://gs.statcounter.com/os-market-share/mobile/japan

You can click around this site to see stats on different regions. Mind you I don't know where they source from.

Also, https://www.businessinsider.com/apple-ios-market-share-us-eu...

https://amp.businessinsider.com/images/5a5e13a228eecc26008b5...

No majority in GB as well. France is highest in mainland EU at 22.7.

How about this site then? https://www.statista.com/statistics/260415/market-share-held...

Majority of the profit? Majority of the revenue? Android has the majority of the unit volume, definitely.

You don’t have to buy new. I just bought a second hand 7 plus for around £350, and it’s excellent.

It’s a couple of generations old now, but it’s in immaculate condition with a good battery and will easily last me a couple of years unless I do something stupid.

I'm OK with Macbook's prices, but not with their abysmal keyboards. I'm not buying another one until that is fixed.

Man... I love the new MacBook keyboards. I know they're not for everyone but I love the feel of it. Any other laptop I use gets my mechanical keyboard plugged in immediately. The MacBook just feels so damn nice.

I like the feel but the feel means nothing if it stops working after a year.

I've had this MacBook for 2 years now and the keyboard is still working. I have a year-old work machine too with the v2 keyboard and it's still working. Maybe I'm just more careful around my expensive electronics than most. Who knows?

How come the keyboard has become some infamous, then? Strange...

I would argue that, because it's Apple, the people experiencing issues are more vocal and because, realistically, this is the first generation of the new butterfly keyboard so there will be some growing pains. I believe Ars posted a hardware survey sent to a bunch of laptop owners and the majority of Apple users preferred the new keyboard. YMMV, obviously, but I think it's much easier for issues to become "infamous" now that more people are using them and they all have easier access to post their complaints in public. On top of that, blogs and tech "journalists" want to jump in on any problem they can.

Because we expect Keyboard to last. Even the crappy ones that doesn't feel good with typing should last 5+ years with less than 1% repair rate. The newest Apple keyboard had close to 3% repair rate, and we had expect it to be less than 0.1% from Apple. That is a 30+ times difference.

They are on the 3rd generation keyboards now. They are fixed in the sense that they don't break as easily nor are affected by dust etc like previous generations.

But if you didn't sort of like the 1st generation I don't think you will like the 3rd, 4th, 5th etc.

> They are fixed in the sense that they don't break as easily nor are affected by dust etc like previous generations.

As far as we know. It’s only been a few months.

Hell, they'd want it more if it was 2k. That thing must be premium.

As long as he manages to bail out before the whole thing falls apart.

The timing didn't work out for Sculley in '93, but maybe Tim will have better luck. Maybe "this time is different."

Apple is a very different company to what it was back then. They only had one revenue source i.e. Mac which was struggling to compete with Microsoft.

Today we have Apple with diversified Mac, iPhone, iPad, Watch and Services businesses. And soon to add Glasses and Car if predictions come true.

Apple had at least two other revenue sources when Scully was there†. Apple II was still selling. There was also the LaserWriter. It was tied to their desktops, but their ecosystem today is also interdependent (eg: "services").

Apple was less big in the 80s than today, but they were still huge. There's a reason they lasted a decade despite uninspired management.

The situation is remarkably similar, if you ask me. Just replace IBM/MS with Android vendors/Google.

† Edit: on second thought, it's not necessarily a plus to say Apple is working on many different products. That was part of the problem post-Steve. See: https://youtu.be/xchYT9wz5hk

They're eventually going to price themselves out of the market. It's just a matter of when.

Has any huge, ultra-successful, ultra-profitable company ever “priced themselves out of the market”? Not for a single product launch or anything, but in a sustained way that seriously damaged the business long-term?

Yes. Apple in the 1990s.

That is why what they ought to know better now. Mind you, they probably do! I think they just worry about the next few quarters. As for the long-term, little personal incentive because "let the next guy or gal deal with that after I've moved on"

Yeah, that’s not what happened to Apple in the 90s. At all.

Maybe your memory is playing tricks on you?

It's why I switched to a PC in the 1990s. And everyone I knew. And everyone I met, read or heard about.

What was the point buying a Mac, when you could buy a faster, more compatible PC running Windows 95, which was pretty Mac-like, for half the price?

But the Mac was NEVER the majority/success the iPhone is today (at least in the US). It was always way behind. And price was a big part of the problem. Performance wasn’t until much later.

Not the Mac, but the Apple II was. When the PC industry began, Apple was king for a few years. Then Commodore overtook them in the home market, and IBM in the workplace.

I'm not sure what you mean about performance? When I switched, I had the impression PCs were outperforming Macs by a long shot. That must have been within a couple years of the Win95 release. I should probably hedge a bit there because my memory might be off. It was a long time ago.

The Apple 2, yes. It wasn’t the cheapest but it was certainly the big player in the US.

Performance: Macs were quite competitive, or even better than PCs for quite a while. It was only later as the Intel juggernaut kept going that Apple started to get steamrolled and had to switch off 68k. They regained the crown for a little while, but even the G3/4/5 were quickly overtaken by Intel.

I can't remember much about specs. Actually I can't even remember if I knew enough back then to interpret specs! Maybe i just thought PCs felt faster or something :)

This reminds me acutely of Jobs' criticism of Apple during the the Sculley/Spindler years: that the company got incredibly greedy and extracted as much value from its customers as possible, without fully delivering on that value.

On the services side of things, I pay Apple $8.50/mo for storage (split between family members, so really much less than that) for all of my photos and documents, and $7/mo for unlimited music (taking advantage of available discounts).

For hardware, an iPhone XR is only $30 more than a Galaxy S9, and though it's not quite an even comparison hardware-wise, that $30 difference buys you about 5 years of software updates, a suite of great creativity and productivity apps, servers that sync and back up, etc. (You can probably get some of that list from Google or Samsung, in exchange for your privacy.)

They could shrink their margins and have plenty, sure, but I'm not convinced that it's really such a bad deal for customers.

The S9 is also very expensive. Only a few years ago the ~$300 phones were awful. These days they're far better, and the flagships are well into the realm of diminishing returns.

>that $30 difference buys you about 5 years of software updates, a suite of great creativity and productivity apps,

5 years of software updates? Can you post a source on that?

iOS 12 supports the 5s, which was released in 2013.

Right. Moreover, they announced at this September's iPhone announcement that they would be supporting devices for longer, as part of their environmental impact reduction efforts.

I thought Apple was going to crumble because they no longer considered the needs of developers? /s

Oh, for sure. The Pro users pissed off about the touchbar and lack of user-replaceable memory are the canary in the coalmine, you’ll see! Apple might be taking in billions per week now, but when all those Pro users stop telling their friends to buy Mac, it’s all over!

They consider the needs of their developer customers, that target Apple plarforms.

Those that buy OS X to develop GNU/Linux software not so much. The days of red numbers are long gone.

$59.5b in net income ($70.9b in operating income) for the last four quarters, staggering.

Their annual sales of $265b puts them ahead of the GDP of countries such as Portugal, New Zealand, Egypt and Finland.

And they do that with just 127,000 employees (but probably many more than that in contractors, suppliers, etc.)

I wonder what the per capita GDP (or GCP? Gross Corporate Product) is of apple vs other companies/countries.

.7 billion per day, mind blowing.

One might say they're raking it in, but I do wonder how many people with rakes it would take to rake up 0.7 billion dollars per day. Top of my head says, "a small city". (Alright, back-of-the-napkin whizzes...)

To make the number as big as we can, we can use pennies. $700M/day = $8101/s = 810,100 pennies @ 2.5g per = 2025kg or 2 metric tons of pennies per second. I honestly have no idea how many pennies a person can rake per second. Pennies are pretty small, so maybe a few thousand at a time with a special rake? I'm imagining that you would have to rake these pennies 100 meters at about 1 meter per second (average walking speed 1.4 - having to rake pennies), so we would have to be raking at any given time 100 seconds worth of pennies (=81M). If a given person can rake a few thousand at a time, then that's about 40,000 people, approximately a small city

Can you imagine having the Money Mines, just the forever drudgery of moving money from one place to another, day in, day out, it never ends.

> Apple will stop reporting how many iPhones, Macs and iPads it sells each quarter, beginning with the December quarter, Apple CFO Luca Maestri said on the company’s earnings call Thursday.

> "If you look at our net income during the last three years, if you look at our stock price in the last three years, there’s no correlation to the units sold in any given period."

As a shareholder, this strikes me as a bit strange and concerning. Why stop reporting how many of each product you sold? It suggests that moving forward sales and business is going to decline and they are trying to be more opaque and hide this fact.

It will force the market to stop viewing them as a hardware company like Dell or HP and instead view them as the ecosystem company they are. That's why they're doing it.

I wonder at what price people will consider switching from iOS to Android. Seems like they sold an incredible number of iPhones at ASPs higher than analyst predictions.

I recently moved from a GS8 to an iPhone 8. Just yesterday I took delivery of an iPhone XR.

I used Android from its inception with the HTC Magic and Dream. Nexus One, Nexus 4, 5, 6p, GS2, GS3, GS8, Motorola Glide somewhere in there. Lots of devices, over every Android version. From a full financial cost perspective (e.g. lifetime cost and then value when retired if I were selling them) virtually all of them cost me more than the iPhone of the days.

It was never about cost. Various platform benefits drew me, from a development perspective it enticed me, and it seemed right for the industry. Almost morally right.

With recent iOS versions, however, Apple has stolen many of the best features of Android (the notification system, how multitasking operates, intents, etc), while at the same time improving on the benefits they already have (a higher quality platform, better security, a better app ecosystem).

As Google started moving to their Pixel platform, continued to abandon 2 year old devices with disregard (my devices are always new, but from a utility perspective I like being able to safely give older devices to my children), Android lost me. Not to mention that it became the Samsung platform with a fringe of Google devices. I also seriously question Google's motives in providing a quality API for developers for things like computer learning and computational photography.

So there's a counterpoint. These devices are so important for our lives now than $1000 a year seems entirely reasonable.

It totaly depends on how important you think a device is.

I bought a $100 Motorola and plan to keep it until the battery isn't charging anymore. So if I can keep it for 5 years I think $20 per year is reasonable.

Comparing this to the iPhone it will save me $980 a year. That's a nice holiday with my family...

Who is buying a new iPhone every year and trashing the old one?

A $1000 iPhone you use 3 years is $333 a year. What is that, one days work as a developer?

A lot of people given that the major carriers have upgrade plans to trade in for the new one after one year.

Or a month salary in less fortunate regions.

Yah so you probably shouldn't spend $1000 on a phone if your yearly income is < $100k

That device won't have security updates. So you just dismessed a major part of OP's reasoning: they don't want an insecure phone and don't want to hand one off to their kids.

Maybe that's what you meant by important?

Most parts of Android can now be updated via the app store. So security is now a big issue anymore since Android 7

Do you have further info on this? It's not Android's reputation to say the least.

This sounds better, but better doesn't make good.

Purchasing a new iPhone every year is not a necessity by almost any definition of "necessary". So you are more like $500/year or $333/year or even $250/year depending on how often you refresh.

That isn't true with many Android devices because of the poor track record of OS upgrades and support.

Even if you do upgrade every year, iPhones hold their value very well, so you can sell your old phone for a substantial proportion of what you paid for it and only pay a fraction of the cost of the new one.

I spend less than $20 per year on smart phones, and have had no complaints about them whatsoever. So maybe the marketing is just really working on you?

Not really.

I work in technology. I have a family. This device is my communications platform, information conduit, photography device, GPS device, and on and on and on. This is the computing device I use for probably 50% of my time.

I also don't have a junk laptop. The things that matter to me I'm willing to not cheap out on. Even if an alternative offered 80% of the utility for "$20 per year", the last 20% would be easily worth it.

And what's the difference? My phone provides the same things you want from yours. I use it all the time. Obviously if you can get the same thing at 1/8th the cost, it's probably not worth it to spend that extra money.

The phone is not even a junk phone:

https://www.motorola.com/us/products/moto-e-plus-gen-4

It's just not a premium "luxury" phone. I spend $45 per month on service and $170 for the device. My fiancée's phone is a $1000 Pixel, and it offers almost nothing more. Nothing that she actually uses anyway.

You are making quite a lot of assumptions prematurely presented as facts, although they may not apply at all to the person you're talking to.

Personally, while I don't doubt that the Motorola works fine for you, I wouldn't even consider it since it doesn't run iOS. Or likely any up to date OS in 3-4 years.

I really hate the “marketing doesn’t work on me” trope. Such a weird way to be condescending. It’s almost never true either.

You're reading too much into what I said.

Apple's attitude towards, and stewardship of, my privacy is worth a very serious markup to me personally. Doesn't hurt that the products are so good too.

You've got to remember that cost of phone is far from the only cost. There are non-monetary costs such as loss of iMessage, Game Center (JK JK no one care about that), Apple Pay, etc. And then there are the actual costs, I've spent just shy of $3K since 2008 on Apple digital "stuff" (so iOS apps, Mac Apps, Subscriptions, IAP, etc) and while I'd estimate there is about $1k or so of actual residual value in those purchases (as in apps/subscriptions I still use daily and would buy again tomorrow if they went away) it's still not anything to sneeze at. While not all of that is iOS (Most of it is, my iOS apps/IAP/Subscriptions total alone is $2.4K) it is all part of locking me into the system.

Here is my breakdown (I pulled these number out of my Apple Data Export):

    iOS and tvOS Apps: $1087
    In-App Subscriptions: $380
    iCloud Storage Subscriptions: $251
    In-App Purchases: $520
    Mac Apps: $560
    iTunes Match Subscriptions: $150
    Apple Music Subscriptions: $0
    Books: $6
    Movie Rentals: $9
    Songs: $5

iMessage is a surprisingly good platform lock-in for the mac, too. I didn't realize how much of my normal Messages/SMS happens on my computer until I tried to switch to linux. No more "let me just text this link to someone..." or "ha ha, let me share this meme with my friend" without it.

I mean you COULD, but then you have to go convince your friends to use $alternateMEssenger instead of their phone's built-in SMS app.

iMessage is the greatest long con that isn't a con of all time. You don't know how great it is until you talk to someone that isn't on iMessage or you lose access to it. It just slowly sneaks into your life until you think it just IS text messaging. Never bought into iMessage "apps" or sticker packs but I love things like typing indicators/read receipts/etc.

I don’t understand the group features at all though. Do people really have groups of friends in which noone has an Android phone?

In smaller or very similar groups yes. I have a group iMessage with 11 friends in it but even so for group messages I normally use FB messenger, a surprising good product, so android/ios is equal.

Out of 40-50 family and friends that I text regularly, maybe 3 are on Android.

Certainly in Europe WhatsApp fills that gap. There isn't much point solely using iMessage when at least 50% of your friends have Android phones.

The web version is fast and functional too.

Does the web version keep login credentials well? I tried the desktop app, but it was taking an insane amount of storage for some reason.

You login with a QR code from your phone.

I don't think WhatsApp even has accounts - just phone numbers.

Oh I know. I meant whether the login stays persistent or whether you have to scan repeatedly on the web version. On the desktop app you can once and it lasts months.

I have an iPhone and almost never use it. I use FB messenger, WhatsApp, Slack, and Discord for 99% of my contacts.

To me, iMessage on the Mac is almost a sad indictment of just how little progress has been made in computing in the last 2 decades.

It's a feature that was obvious back when we were all using Nokia 3310s. Connect phone and computer as one thing. Call and message from either. Heck, calling from your computer was an obvious feature-to-be back in the monochrome screen days!

It's ridiculous that a) Apple is the only company that has this right now, and b) it took them so long to get there in the first place.

What the hell is everyone doing!?

What are you buying for iOS and In-App? I've only spent maybe $100 in total on iOS apps, across a good five years

I think my only MacOS app expenditure was parallel and daisy disk.

My Apple costs is almost purely hardware

I'm not going to lie, I'm not proud of my IAP total. I am perfectly fine with purchasing level packs in games or full unlocks in apps but about half of that IAP was shit like gems/coins/etc that I spent on various games before I got that under control. As for iOS apps I have a couple of $20-$30 apps that really ratcheted up the total but I test out a lot of apps/games and while that number is large we are talking about ~$100/yr on apps which I am personally OK with.

If you would like I could get more specific on which apps/games.

Sure; I’m mostly fine with ponying up... my biggest issue is I don’t see much out there even worth paying (especially with my macbook; most things seem to have an equivalent or better OSS alternative, especially if you’re not constrained to the gui [where OSS is usually ugly as sin]). Even in games, the only mobile game I’ve ever thought to pick up was King of Dragon Pass, and that was just because I already knew it’d work well on a phone

As long as that budget isn’t comprised of a single photoshop license, I’m interested to know what you’ve thought was worth grabbing.

Here are some quick stats I spit out:

  Paid vs Free apps:
  Mac: 57 Paid vs 33 Free
  iOS: 310 Paid vs 227 Free

  Stats:
  ╔══════════╤═══════╤════════╤═══════╤═════════════════╗
  ║ Platform │ Mean  │ Median │ Mode  │ Range           ║
  ╟──────────┼───────┼────────┼───────┼─────────────────╢
  ║ Mac      │ $9.83 │ $4.99  │ $4.99 │ $0.99 -> $59.99 ║
  ╟──────────┼───────┼────────┼───────┼─────────────────╢
  ║ iOS      │ $3.51 │ $2.99  │ $0.99 │ $0.99 -> $59.99 ║
  ╚══════════╧═══════╧════════╧═══════╧═════════════════╝

I need to clean up my output for "By Seller" because right now it looks like this:

  Totals By Seller:
  Apple Inc.: $493.05 (iOS Apps: $21.6, Mac Apps: $70.96)
  Supercell Oy: $252.7 (IAP: $252.7)
  Evernote: $147.96 (Subscriptions: $147.96)
  Panic, Inc.: $87.95 (iOS Apps: $37.96, Mac Apps: $49.99)
  Hindsight Labs LLC: $67.94 (iOS Apps: $17.96, Mac Apps: $49.98)
  Assembla, Inc.: $59.99 (Mac Apps: $59.99)
  American Honda Motor Co., Inc (Acura): $59.99 (iOS Apps: $59.99)
  Strong Fitness Ltd.: $54.89 (Subscriptions: $54.89)
  ...

Which is not super useful unless you know that name of the company behind the app. I need to re-write my code to at least put a list of the app names at the end or something. For reference, in order the apps are:

  Apple Inc = Mac OS's
  Supercell Oy = Clash Royale (Not proud of this number at all)
  Evernote = Evernote (duh)
  Panic, Inc = iOS: Prompt, Prompt 2, Coda, Transmit, Status Board | Mac:  Coda 2 (I own most all their mac apps as well but didn't buy through the store)
  Hindsight Labs LLC = Paprika 2 and 3 (for iPad/iPhone/Mac) (recipe app,  hands down the best one out there, trust me)
  Assembla, Inc = Cornerstone (svn program)
  American Honda Motor Co., Inc = Acura Link (WASTE OF MONEY, I should have fought this charge)
  Strong Fitness Ltd = Strong (iOS Workout tracker, I think it was like $5-$6/mo)

I need to also have my code print out top purchases by price (ignoring seller). I can pull out more if you would like.

Edit: As you can tell the Apple Inc line is wrong, it looks like it's not pulling in the "special" categories they created for iCloud stuff, I'll fix that later.

People are also factoring in TCO with iOS/Android.

Apple supports their devices for 5 years. Android it's more like 2 or 3 and often much less. And with Apple's retail presence it's easy to get 1-1 support which is non-existent for anyone other than Samsung. And with the extraordinary performance of their A CPUs often their devices are holding up longer as well.

Who keeps their phone for 5 years. The battery will be bad in 2 years. Replacing it requires disassembling a phone.

I've had my 6s since Sept 2015. It reports battery capacity as 86% of new, and still not throttled. I'll probably get the $29 battery replacement before the end of the year, just in case and keep the phone at least another year, if not 2. Previous phone was a 4s, bought Oct 2011. So, I guess I'm saying, "me. I keep my phone that long, or nearly so."

https://www.businessinsider.com/how-long-people-wait-to-upgr...

The average person has their phone less than 2 years. If we assume a normal distribution and a standard deviation of 11 months then 83% of people will keep it less than 3 years. 5 years would be 3 std deviations. That is a very small number.

Not sure about US but in Australia you can go to any shopping mall and there will be a shop where you can get your battery replaced.

Or even in most cities there are phone repair places that will get you a new battery pretty cheaply.

This is also true in the US (not sure of prices though I can’t imagine why it’d be mich different from Australia).

One big problem is that you don’t know whether you’re getting genuine parts, and aftermarket stuff can be quite crappy.

I usually just keep my old phones in storage when I switch, and hand 'em off to visitors and such (or when I break my phone); comes in handy often enough. Battery holds sufficiently in a drawer.

Replacing the battery is $29, parts and labor (for this year).

That was a special because of the throttling the normal battery replacement is more than that.

Yeah, but it’s not like it was $150 before. Compared to a new phone starting at $650 or so, even $89 (old price?) is a bargain.

(Obviously the new phone would have other benefits, but it’s a big price jump. Even for a refurb.)

You could get a mid tier new phone for 200 which will be better than a 2 year old phone.

The phones keep resale value that way.

I doubt cost would ever be a primary concern that drives people to Android. If cost is a concern for me, I could still get the iPhone 7 ($449 - new from Apple).

I think that the cost of the phone is financed really helps here, too. It hides (mostly) that you are purchasing ~$1k worth of equipment.

I have a Dell XPS dev edition that I tinker with, installing various linux distros and trying stuff and breaking it and fixing it. I do it because it's fun.

My phone has to be 100% rock-solid. I do lots of actual important stuff on it.

I'm never switching to Android, because it's a gamble. Which model? How long will it be supported? Is it vanilla Android, or did they break it with custom shit-ware? Will they ever fix security holes?

The "wall of sheep" at Blackhat is mostly Android phones too.

You hit the nail on the head. Lots of tech-oriented people seem to have this compulsion to tinker with everything which is why they can’t understand why someone would prefer an iPhone.

I simply do not care about being able to root my phone, side-load random crap, or use third party browsers. I barely even change the wallpaper. That stuff is what my real computer (running FreeBSD) is for.

What I care about on my phone is having a huge, pretty screen, good performance (i.e., no frame drops and jank when interacting with the UI), reliability, and security.

What Apple has realised is there is an entire class of people who simply don’t mind paying $70 a month or whatever it costs to have a new iPhone, even though they’re not competitive in price, it doesn’t matter, and so Apple gets to make these huge profits.

What HN commenters have realised is there is an entire class of commenters who simply don't mind inventing figures or whatever it takes to create a straw man, even though they're not congruent with reality, it doesn't matter, and so the poster gets to declare victory.

> not competitive in price

Yeah those rubes paying Apple's $793 ASP could gotten a Galaxy S9+ for only $840. Or a Pixel 3 starting at $799,a Pixel 3XL for $899, a Note 9 starting at $1000 or a Huawei P20 Pro for €899 instead.

I'm one of those people. I was getting iPhones every 2 years, but my phones were laying around wasted. I would rather "rent" my iphone and switch it out every year for essentially the same cost, and not have to deal with the phones laying around. Plus getting Apple Care every year makes sense now with the screens being so expensive to fix.

>even though they’re not competitive in price

Explain to me how having the fastest silicone in the business is not "competitive" in price? I mean if you are the top dog, you kinda get to set the stage, no?

You mean “silicon”, not “silicone”. (Or maybe you do mean “silicone”?)

Right you are, silicon. Thank you. Not caulking material :)

They do have the best silicone, and I was trying to explain why they get to set the price they do and get away with it.

It’s just that, for example in South Africa the new iPhone XS costs R22000-24000 which is $1500 - the Samsungs and especially the Huawei’s are much cheaper. You can get a P20 lite for like R5000 which is an outstanding phone. But again many South Africans can afford the iPhone.

Well of course! Not everyone needs the best CPU. I recently got Huawei Mate for my mother in law for let's see 1/7th of what I paid for my IPhone XS Max. Some people do (I play a lot of 3D games and what not), but vast majority of the people do not. It's just that Huawei and Samsung have offerings that span the whole range of prices whereas Apple only covers ultra-premium segment. And if you venture into Apple prices are comparable to others (and command much better resale).

AAPL just lost it's 1 trillion market cap. Ouch.

Share price going down after market when an earning release drops is hardly new.

What's volume? After-hours trading tends to be extremely light (and heavily restricted as to who may participate), so prices have a tendency to deviate from reality by quite a bit. Watch the futures if you want to know where AAPL will land in the morning.

I wish Apple brings their iPhone Upgrade Program to outside US and Apple Cash to Outside US as well.

Bless this thread. May the gods of RSUs shine a bright light of good fortune.

We can all thank googles incredibly lack of privacy for Apple iOS success. I’m sure most people use an iPhone because it’s simple and because the value on privacy is greater.

Other Android vendors should sue google for ruining any chances of actual competition.

I think most people use iOS because they prefer it. The fact that iOS generally values privacy more is an added benefit.

People use iPhones because they are status symbols. Android phones have been more useful than iPhones for many years now, and Apple is pushing the privacy angle as a way to divert attention from that, but outside of a few gullible techies, nobody is making purchasing decisions off of that marketing yet.

https://news.ycombinator.com/item?id=18359448

And of course AH, AAPL crashing, down -14 already.

"Buy on the rumor, sell on the news" is a tradition for Apple's Quarterly reports going back to at least 2004 (by my own memory).

I guess even if the phone sales stay flat they can raise the price and get more revenue/profits. This would a great economic experiment. How inelastic are iphone sales.

From years i am speculating about this thing: Apple is a service company. Computers/Tablets/Phones everything is just a locked box for profit. I don't mind profit at all. But clearly in my view so much money can be used to deliver something outstanding for a reasonable price. The Apple tax from the past was: More money for highest quality of hardware and software and unrivaled reliability. I loved this and not only used their products, i was evangelist for the brand. The Apple of today is a service company: The Apple tax is abomination and in my view disrespectful toward users. Slowing down hardware update cycles, making obvious bad design decision, locking down Mac Os step by step and blending it with iOS (there is no Mac Os software division). So shareholders are happy, management is happy, users are .... The fact that i can migrate to Ubuntu Mate after years of using Mac OS X speaks enough. I intend to evangelize the Open Source and Linux to the max. Software is the key to the Future of Human Kind and the idea that some monopolistic company wants control is ugly and old-fashioned. So if Apple wants to redeem them selves in the eyes of professionals here are some recommendations: Stop over-hyping every product. Understand that iOS is companion os. Stop 30 percent tax on developers, make reliable hardware again, fix Mac Book Keyboard, again fix it now. Stop overpricing the iPhone. But wait, who cares about this, obviously nobody. So sorry for my rant...

    The Apple of today is a service company

No, they're a company who are nervous about where their growth will come from. They aspire to be a "Services" company, but unfortunately they aren't much good at it (see the usual list of failures. eg: Maps, Siri, etc). But "Services" is a nice murky bucket into which they can sweep various kinds of revenue, and still appear to be innovating.

Do you remember this news story? https://www.cnbc.com/2017/08/14/google-paying-apple-3-billio...

The key quote being "Google's licensing fees make up a large bulk of Apple's services business"

> They aspire to be a "Services" company, but unfortunately they aren't much good at it (see the usual list of failures. eg: Maps, Siri, etc).

The whole "Apple is not good at services" thing is an old tripe. 2012 Apple was not good at services. 2018 Apple has now consistently been growing services tremendously for several years with several notable huge successes. They are now one of the largest companies (by revenue) in streaming music (Apple Music), contactless payments (Apple Pay), software sales (App Store), etc. Sure Siri and Maps are not necessarily best of breed. But not being best in every category, does not mean you are not good at something.

Actually, the key takeaway is that some analyst last year thought they were paying $3 billion. They’re making $10 billion on services now. Hardly seems that concerning, especially given the growth and the fact that you have no idea what Google is paying them. I also fail to see how a huge and rapidly growing services segment indicates that they’re no longer innovating. Especially given their total dominance and revenue growth in their other categories.

Your comments all over this thread kinda just make it seem like you have an ax to grind against Apple.

   Your comments all over this thread kinda just make it seem like you have an ax to grind against Apple.

I'll assume you're not really interested in debating my motivations for posting here. That sounds like a good way to just get into a petty internet argument.

Other than that, you make some good points.

No, I don't see Apple innovating in ways that matter to me, to be honest. Of course, that's a messy argument. They have changed plenty of things since SJ passed. Those products appeal to many people. So I don't know how to quantify it. They've certainly made a lot of money, so there's that.

As for services and Apple's focus on it: is it helping anybody? It doesn't help me. Instead I get nag screens and advertisements I didn't used to get. I get pushed to a "subscription model" I don't want. I get second rate versions of Spotify, Google Maps.

And I've seen Apple evolve from eWorld through iTools through dotMac, MobileMe, iCloud... I'm not the only person whose mouth those services left with a bad taste.

If Apple truly is, first and foremost, a "services company" as the OP pondered, then I think they really have their work cut for them.

Actually i agree, for the "nervous" part. I will be happy when greed inside decision-making processes crumbles over their heads. Who knows, may be failure is needed indeed to restart Product Thinking that Jobs was famous for.:)

Would you say they are not good at services or data science? I personally think it's the latter. Maps and Siri are pretty heavy with ML, and I won't expect these to shine compared to say Google. Services like itunes, icloud, App store, etc. are much less reliant on great algorithms, but more so the packaging and infrastructure.

Wat?

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