Company / division: iPhone
I saw an article pop up this morning from Mashable about Apple and its repairs policy, and then saw another this afternoon from the Verge (linked below) on the same topic, which made me wonder why, and it turns out that the answer is a new report from the Repair Association. The Repair Association is an industry body made up of device repair companies and environmental and other organizations, and as such has a clear point of view on device repairs: they’re a good thing, and any limitations on repairability are a bad thing. I had a long Twitter exchange this morning with the author of the Mashable article about this topic, and the thrust from my side of the conversation was that the framing here is all wrong. Yes, Apple does place restrictions on who can repair its devices and how, and it also increasingly designs its devices in ways which make them harder for third parties to repair, but as I’ve said before in the context of iFixit and other repair companies’ reviews of Apple devices, this isn’t done to thwart repair companies or customers, and it isn’t a money grab.
The big shift in Apple’s design over recent years has been increasingly tight integration of components, which has been a key enabler of making devices smaller and more powerful, something that’s been a part of iPhone and iPad design from the start but which has more recently spread to the Mac line as well. This definitely makes repairs harder, and Apple also places restrictions on how screens can be repaired because they’re integrated with the Touch ID sensor that controls device unlocking and Apple Pay among other things, and repairing them without access to special tools stops Touch ID from working. Again, that’s a side effect of Apple’s security-centric design and not a deliberate strategy to frustrate would-be repairers or customers. Apple opposes some of the stricter standards and regulations proposed by states and various bodies because they’re often designed to prioritize repairability over functionality, sometimes in ways which seem directly aimed at the way Apple designs its products. Meanwhile, Apple has made enormous strides in its environmental efforts over the last few years under the leadership of Lisa Jackson, formerly head of the EPA and therefore no slouch when it comes to environmental protection. That’s extended from using sustainable energy to better recycling of parts with Apple’s Liam disassembly machines and so on. Apple is moving in the right direction here, and as the Verge piece at least acknowledges, none of what Apple is doing here is actually environmentally unfriendly, as the Mashable piece suggests.
via The Verge
New smartphone shipment and market share numbers are out for Q2 from various analyst firms, and they all show the same broad pattern: somewhere between a modest decline and modest growth year on year for the market as a whole, modest growth for Apple and Samsung, and strong performances by three Chinese vendors, with Huawei making significant gains in the number three spot. IDC, Strategy Analytics, and Canalys among others differed slightly on the exact shipment numbers, while Strategy Analytics seems to find another 20 million or so shipments somewhere compared with the others. The top four spots have now remained unchanged for over a year, with the exception of Q4 last year, when Apple briefly pipped Samsung for the number one spot, though this quarter Xiaomi’s resurgence squeezed Vivo barely out of the top five. Huawei got within a few million of Apple’s sales total for the first time off the back of pretty strong growth, but Xiaomi had by far the fastest growth (which you already know if you’ve read two earlier pieces on Huawei and Xiaomi). The broader picture has Chinese vendors dominating the top ten, though these firms only report the top five in their public releases: by my count, Chinese vendors take seven of the top ten spots, with Apple, Samsung, and LG the only exceptions. And those Chinese vendors rely enormously on the Chinese market for their sales, while several have no presence in the US at all, meaning that the smartphone market is increasingly fragmented globally, with different players taking the lead in different parts of the world.
via Android Police
Apple reported its fiscal third quarter / calendar second quarter results today, and they came in at the high end of its guidance and beat analyst estimates. One of the biggest surprises was strong iPad unit growth year on year after four years of declines, and just the second quarter of revenue growth for iPads during that period, thanks largely to sales of the lower-priced $329 iPad introduced earlier this year. But Apple said all its product categories saw year on year revenue and unit growth, with Apple Watch reportedly growing 50% year on year, and Mac and iPhone unit growth up modestly, while the Services business continued on its recent tear, driven largely by the App Store, but also to an extent by Apple Music and iCloud storage plans. iPhone ASPs were up modestly year on year driven by stronger sales of the latest Plus models, and would have been up more if not for the fact that the company sold down its inventory significantly, with almost all the reduction being made up of more expensive phones.
Perhaps more significantly for the longer term outlook, the company provided guidance for the September quarter which essentially guarantees new iPhone hardware in September. I would guess that at the very least Apple will have the successors to the current phones on sale in the usual timeframe and in the usual volumes, while my hunch is that the new higher-end model will also go on sale at the same time but be even more heavily supply-constrained than new iPhones usually are.
Apple continued to talk up performance in mainland China as distinct from the Greater China region it reports, where sales were down 10% year on year, the best result in nearly two years, but still a drag on overall results with other regions all growing, all but Japan at double digit rates. Tim Cook also addressed the issue of VPNs in China which I wrote about yesterday, and defended Apple’s stance, which is a combination of following the law in each country where it operates, and believing that it’s better to engage and stay in a country than leave, even where it disagrees with policy (my notes on this portion can be seen here).
Overall, Apple’s management on the call seemed as bullish as they have for some time, clearly looking forward to what they expect to be a strong finish to the year in both product and financial terms. Tim Cook wasn’t drawn the slightest bit on new iPhones, but did hint at new products this fall, talked about the role of autonomy beyond vehicles and Apple’s big project in this area, raved about ARKit and the potential of AR, among other things. There’s clearly a good mix of products coming to market in the near term and investment for the long term which Apple’s management is also happy about. That’s no guarantee of a strong performance in the September or more importantly the December quarter, but I continue to be pretty bullish on what’s coming over the next few months from Apple.
Apple Drops to Fifth Place in China Smartphone Market in Q2 (Jul 26, 2017)
LG and Apple Said to Invest in OLED Manufacturing Capacity (Jul 25, 2017)
Sprint’s Virgin Mobile Goes iPhone-Only in Relaunch (Jun 22, 2017)
This is exactly the kind of speaking out of turn that Apple suppliers absolutely know not to engage in, so it’s baffling that Wistron’s CEO would have been so careless. Wistron, of course, is the vendor Apple is using for its first foray into manufacturing in India, and this is the kind of thing that tends to jeopardize those relationships. It’s not a huge revelation – Apple joined the consortium that manages the Qi wireless charging standard which it already uses in the Apple Watch a while back. But it’s one of a number of new hardware features that are likely to make it into the next iPhones – certainly not the headline feature, but one of a checklist of features that will be used to drum up demand. On the other hand, I remain skeptical of the value of mat-based wireless charging – though there’s some appeal to just putting your phone down to have it charge, that really requires several chargers in different places around your home and/or office to be useful, and it’s actually more limiting than traditional plugged-in charging for things like making phone calls or typing on your phone, where you might want to hold it while it’s charging. I’m still most curious to see whether Apple has made any advances in this regard and how it will both approach and sell wireless charging as a feature.
via The Verge
I’ll start with my usual caveat on so-called “gigabit” wireless services: though theoretical throughputs on devices with the new modems being discussed here can reach gigabit per second speeds, the real-world experience is going to be a fraction of that. In other words, even if the reporting in this article is correct, Apple isn’t going to be missing out on true gigabit speeds any more than the other device vendors will have them. The second caveat is that even the more realistic speeds will only be available where carriers have upgraded their networks to support them, which will be far from everywhere for the near future. With those caveats out of the way, though, Apple will be one of the few device vendors out there without these faster modems in its devices over the next year. However, as the article rightly points out, Apple has rarely been willing to put cutting edge new modem technology in its devices at the same time as others, generally preferring to wait for the technology to mature before deploying it, as it notably did with both 3G and LTE. There is, of course, this time also the added complication of Qualcomm being the only supplier with a gigabit modem ready to go, and the fact of Apple’s very adversarial relationship with Qualcomm and its decision last year to introduce Intel modems. I’m inclined to believe the reporting here is accurate, but I’m not sure it’s really all that significant – in real-world experience, there will be very little difference for many customers over the next couple of years, and Apple will almost certainly jump on the gigabit modem bandwagon next year, likely through Intel.
Apple has been in battles with various states over so-called “right to repair” legislation in recent months, and one of its key arguments against proposed new laws is that its devices have to be repaired in special ways in order to ensure the continued integrity of the Touch ID sensor and the secure enclave attached to it. Replacing an iPhone screen with a damaged Touch ID sensor, it argues, is something that can only be done by official Apple technicians with the ability to certify the integrity of those components. That, in turn, means that not all screen repairs can be conducted by any run of the mill repair center. Predictably, critics have argued that Apple merely wants to preserve what they see as a lucrative repair business given that Apple often charges more for such repairs than mall kiosks. All that is by way of context for this news that Apple is planning to put a couple hundred of its proprietary screen repair machines into third party repair centers in the next little while, with another two hundred coming by the end of the year. This puts some weight behind Apple’s argument that it’s intent on preserving security of devices and not merely its revenue streams, given that it’s now opening up access to those machines, albeit mostly through big partners like Best Buy. Given that there are still states with no Apple Stores at all and other parts of the US where people would have to travel long distances to one, it makes sense to spread availability of the repair technology more broadly, and Best Buy already hosts mini Apple stores within its stores to help meet these needs. But I don’t think any of this is going to neutralize the calls for Apple to open its repair processes more broadly, which is a great illustration of how narratives form around what are at root fairly complex subjects. It’s far easier to claim that Apple is somehow acting against its customers’ interests in this area than to explain the complexities involved in repairing a Touch ID sensor with all the security implications that has.
Apple today upgraded its iPad Pro lineup and announced a new version of iOS with big changes for the iPad as well as support for AR. The major theme in both the hardware and software aspects of the iPad announcements was productivity, where Apple continues to push the iPad Pro as a potential laptop replacement. The hardware changes improve performance across the board while specifically tweaking the ratio between screen and device size for the smaller iPad Pro in a change that likely foreshadows what Apple will do in a more dramatic way in the Fall with the iPhone. Just as the Mac lineup became more powerful with today’s announcements, so the iPad is becoming more powerful as a potential computer replacement, and the iOS changes specific to the iPad further that message, with support for a much wider range of multitasking scenarios and other more sophisticated features. For the first time, the iPad version of iOS feels like it’s gaining a truly distinct identity that’s really optimized for heavy-duty productivity tasks, and it will be interesting to see how the OS feels on the iPads not designed for pro use, because a number of user interface elements and conventions will change as a result. However, the other big change in today’s iOS announcements is support for AR through ARKit for developers, which is Apple’s first foray into AR. Notably, whereas the VR support in the Mac is primarily aimed for today at creation of VR content, Apple’s AR push is much more end-user centric, and will enable developers to quickly and easily create a range of AR apps and games for the iPhone and iPad. Whereas smartphone-centric AR today is very photo- and video-centric and dominated by companies like Snapchat and more recently Facebook, Apple’s platform approach could dramatically expand the use of AR in smartphone apps and move smartphone-based AR forward significantly in terms of mainstream adoption.