Smartphone Sales Are in Freefall, and That’s Okay

I use smartphone as camera. The single most important reason to upgrade smartphone for me is better camera because all the photos you take most likely going to live forever, probably spanning multiple generations. I think there is still lot of juice left in this area. If someone came out with new AI camera that started producing amazing super resolution wide lens images with professional colors, night vision, infrared, UV photography etc - that would be a huge deal. Battery is next most important issue especially when you are travelling and taking pics all day. If someone cracked battery issue or made this more power-efficient that would be huge case for buying a new phone. Headphone jack, non-slipper surfaces, not having to put ugly case on it - is 3rd most important reason to buy new phone. Peripherals, ability to use smartphone for other devices etc is probably the 4th.

But you see the problem... Folks have been rapidly increasing prices while giving nothing that customer wants.

AR glasses, I'd bet. Interest in smartwatches has remained lukewarm despite years of aggressive improvement. But if a company could put a HoloLens in the frame of a stylish pair of glasses - using AR tech which Apple and Google have both been aggressively innovating on in their respective phone frameworks - I think that could be a very real improvement over these awkward rectangles we have to fumble with and drop and which constantly pull our eyes away from the world around us.

The hardware challenges are significant, but the same was true of the original iPhone. And we know Microsoft and MagicLeap are both making lots of progress - I wouldn't be surprised if Apple and Google are doing their own hardware research.

Personally I'll put off upgrading my iPhone as long as possible just so I can keep a headphone jack. I listen to music on the phone, I hate dongles because I lose them, and I have headphones that cost more than the phone did.

I think Apple is aiming for a cycle of computer, phone, tablet where you get a new one in the sequence every 1-2 years.

Yeah the watch is underestimated. Close to 100M devices (rough estimate I cobbled together from 2017-19 data) is hardly a niche.

"They've been letting the prices creep up much faster than inflation for several years now and they've hit the point where people can't afford the flagship phones anymore"

I think it's because you don't need a flagship. 10 years ago phones were crap (let's be honest) - slow, small etc. You needed to pay a lot for a phone with a decent battery life, large screen etc. Now you don't. It's like 3d graphics cards back in the day. You needed quite an expensive one for games to look good. For years now though you've been able to play pretty much every game with very cheap graphics cards so long as you're happy to turn some of the settings down a little.

With Android, you know you're phones going to get abandoned with 18-24 months so why not get a £250 phone instead of a £800 one?

Non-Apple smartwatches are handicapped by WearOS development. Apple seems to be ahead of the game and Google is lagging behind with WOS. I'd love it if they focused some more on it, though I do use my watch for fitness and sleep tracking and it's pretty solid in that regard.

I really am a big fan of the Apple Watch and have bought every generation since the 2nd one but it's still limited without an iPhone (ie no way to browse the web). They will need to solve the problem of screen size before it could truly be a replacement. Perhaps some sort of folding screen or projection. I would also love for them to embed a camera in the watch near where the crown is.

Everyone has Airpods and an Apple Watch to go with their iPhone now. That's an extra $169 and $399.

It's a bigger delta from the 50% or so growth year over year that they were seeing just 5 or 6 years ago.

Again people see exponential growth and they extrapolate it out forever for unlimited profits but then get disappointed when the actual growth is an S curve.

I think there is a big market for the SE. Aside from people like yourself who like the form factor, I want buy them for my kids. A) They are cheap, B) with an otterbox they are pretty much indestructible, C) I can use the apple ecosystem to do a bunch of stuff like backups, tracking, remote wipe, reuse apple music subscriptions and purchased music, etc. D) if it breaks or gets lost, I only get 50% mad.

My son has had one for 3 years, it's still great. I stupidly bought my daughter an iphone 8 because they didn't have the SE in stock anymore, and she dropped it 100 times (with case) and then finally dropped it in the toilet. I have $250 left on the installment plan, so she's sans phone until I buy her the cheapest Android imaginable as that's my only choice these days.

For what? My answer was always for the camera! But now I have a 2-year-old phone with a pretty great camera and I'm not sure I need a slightly better one for $1000. All I need is a new battery.

"Literally the only hardware improvement I can think of that might convince me to upgrade before it breaks is a smaller screen, for easier one-handed use."

Out of interest, why didn't you go for the XR?

agreed. i was a big fan of the SE, but finally took the plunge when i realized that because of the smaller screen, i was being shorter with my replies, which had an effect on convos.

the price is of course killer, but i haven't dropped a phone, and it should be fairly future proof, so in the end i think it made sense.

that said, i still dream about a world where android isn't controlled by an adtech company. hardware-wise, the oneplus x was perfection, but the software and lack of timely updates let it down.

Last year, I replaced an iPhone 6 or 6s with a 7. It works fine and was about half the cost (or less) of the new hotness. Presumably a lot of people are thinking the same.

Video games used to push the PC market, I remember when you used to have to pay attention to minimum requirements. The last 10 years of video game development has focused on indie games (Minecraft, pubg, etc), and you can run these games on a potato. Why would anyone run out to get a new machine?

Same thing with smartphones. Until a killer app comes along that pushes hardware, there’s no reason to upgrade - any iPhone past the 5 does pretty much everything the XS does.

The price can also be incremental if the previous year’s device is sold to cover some of the new device cost. iPhones, in particular, retain a significant portion of their value after 12 months.

This is the biggest reason the Samsung Fold, for all its very big problems right now, is so exciting to me. That seems like a major change with exciting possibilities

How about multiple day battery life?

You probably don’t even need that much more battery, just a smaller screen and slower cpu/gpu.

One could argue that it isn't the stabilization of specs but that of appearance that is harming sales. Many consumers purchase an over-priced product/brand because it is over-priced if they can show it off in public. But that only works if it looks different from the lower cost or older models.

> "From a design perspective, the thin bezelless/buttonless slate makes it difficult to differentiate your product."

this plays directly into apple's strengths (build quality, UX, etc.), and i'd be very impressed if it had been a conscious strategy employed by apple over the years (apple still captures the majority of industry profits). by collapsing the feature space along (roughly) one dimension, it's easier for consumers to recognize the premium positioning of apple's iphones.

A few month ago the foldable screens were hyped like crazy. Maybe it was too soon but it could be another differentiator if done well.

$599 in 2011 dollars is $682.09 in 2019 dollars.

Early iPhones were subsidized by carriers so maybe that's why they appeared cheaper. Its always been expensive for a new unlocked version.