The Apple Eco-system
Recently, Apple has released the full line-up of the iPhone 12s. To everyone’s surprise, it was generally cheaper than the iPhone 11 line-up, but why?
Is Something Shady Going On?
The short answer is no, but the obvious problem with this is Apple is making much less money from this than last year if any at all. So, why would it be cheaper? You might say it is because it doesn’t come with any other accessories like Air Pods or almost anything for that matter, it only comes with a 5-watts charger. However, I think that it is much more than that, a much deeper reason than that.
Why Would Apple Make It Cheaper?
Why would any company make their latest and greatest cheaper than their last model? The answer is a weird one, definitely not one that comes to mind on first thought. Before I explain why, keep in mind that Apple also made their Home Pod mini and Apple Watch cheaper.
Apple has been known to only make one to two prestigious phones per year, meaning that owning an iPhone is a luxury. Though, in recent years Apple has made 4 to 6 phones per year, ranging from the iPhone SE to the iPhone Pro Max. Compared to a few years back, it’s a lot easier to buy an iPhone. A lot of Apple’s accessories work a lot better with an iPhone if they would work at all without one. That means having an iPhone is essential to using this kind of Apple product. Remember when I said that Apple also made the Home Pod mini and Apple Watch cheaper? Well, here’s why.
A lot of people will buy Apple products or any product in general just because it’s cheap, and Apple is using exactly that to their advantage. If you want to buy the Home Pod mini or the Apple Watch, you’ll have to buy an iPhone to come with it. You might say that you can’t afford an iPhone and therefore can’t buy those, well, that’s exactly why Apple is giving you the choice to buy the iPhone 12 mini and the iPhone SE. You can think of it like Apple giving you a one-way ticket to Apple City, it’s going to be cheap getting in, but not getting out.
Why is Apple Doing This?
Apple has always been a company that targets the riches of people, but as I said before, it seems as though they are changing that. They not only want people that are willing to buy the highest-end phones, they also want people in the mid-range and even the budget market.
It’s clear that as technology advances, so does the price tag. For that exact reason, people tend to keep their phones for much longer.
As you can see from this graph, the amount of time one keep their smartphone is skyrocketing. This is because a lot of people, especially the ones who buy the top-end flagship phones don’t want to spend another 1–2 thousand dollars to buy it. For a lot of people, their phones are good enough. Most phones in 2020 come with a fluid 90 or 120Hz display and a big 4000+mAh to last them through the test of time, which means there is no need for them to upgrade.
Hardware and Software
With hardware being less and less of a problem, the only way for smartphone companies to make money while still being a smartphone company is software. Although Apple does have software things like Apple Pay and App Store, its main gains of profit are still from selling smartphones, the hardware. What that means for Apple is, if they don’t change their strategy, their not going to be in the market for long.
That’s exactly why Apple is making everything cheaper, they want you to buy an iPhone and make more people use their software and subscriptions. They need more people to use their subscriptions, otherwise, the fate of Apple could end up like Nokia.
Apple’s Accessories
You might argue that even if people do buy an iPhone, they can always switch back to an Android. Here is where you’re mistaken. You have got to remember, most of Apple’s accessories only work with an iPhone, so if you want to continue buying these cheap accessories you have to stick with an iPhone.
Once you have bought those Apple accessories, you still can’t switch to an android, because if you switch to an android, you’ll have to switch your complete setup. Simply because they don’t work with an android.
Conclusion
I’ve said this before and I’ll say it again. For a lot of people, the hardware they already own is good enough. That means that to survive the tech market, the main way of getting profit would be from the software. What software and subscriptions you have, depends majorly on what hardware you use, and that, my friends is exactly why Apple is giving you almost free hardware. For you to use their software.
