Apple's last quarter was kind of bad news / good news.
The bad news is that sales of the iPhone dropped 17% compared to the same period of 2018. The good news is that Wall Street seems to believe that the iPhone nowhere seems to go up and let Apple's stock rise.
However, there is worse news – not just for Apple, but for the entire smartphone industry.
Analyst firm IDC reports that smartphone shipments for the first quarter of this year were 6.6% lower than in the same period of 2018, the same week Google boss Sundar Pichai said it was more difficult than expensive , high to sell phones. Samsung also announced profits this week, saying that competition in the "mature" smartphone industry in the second half of the year will put more pressure on business.
It's hard to see how or if the smartphone market will grow again from here.
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Even new customers will be hard to find – at least domestically, as nearly 80% of Americans today have smartphones.
Different companies use different tactics to hedge against this slowdown.
For example, Apple has doubled its service business – Apple Music, iCloud, and Apple Pay – to help the company generate more revenue per iPhone user, which could offset the decline in device sales. Expect this strategy to escalate in the future as Apple TV Plus streaming service and the Apple Card credit card are available to consumers.
This approach shows first positive signs. Apple reported this week that service revenue increased 16% over the same period last year.
Others, such as Samsung, Huawei and Motorola, are driving the smartphone market, expecting new technologies such as high-speed 5G wireless internet and foldable screens to encourage users to upgrade. Samsung alone is expected to deliver a 5G-compatible version of the Samsung Galaxy S10 and the delayed folding Galaxy Fold smartphone this year.
Realistically, it will take a long time for 5G to really surround the world and the fiasco is near. The Samsung Galaxy Fold – at the some Critics noted that the device broke after just a few days – showing that foldable smartphones may not really be ready until the first hour.
Read More : The Samsung Galaxy Fold fiasco is the best example of why Apple is always waiting for new markets.
And nobody can ignore that the flagship of smartphones is becoming more expensive: the Samsung Galaxy S10 starts at $ 900; The latest model of the iPhone Xs starts at $ 999. From then on, the prices rise at least. The 5G Samsung Galaxy S10 will cost $ 1,300 and the Galaxy Fold will top $ 1,880.
Prices are likely to settle at some point, as in the years following the introduction of new technologies. In the short term, however, this will be a difficult sale – folding screen or no and wireless 5G internet or no. These devices only run the same apps and websites as lower-cost phones, with little difference in functionality. In addition, companies like OnePlus manufacture flawless phones at medium prices.
So while the smartphone market is not doomed to failure, the glory days of the early smartphone boom are unlikely to come back for anyone.
The good news is that we can already see what comes after the smartphone. Nearly every tech company in Silicon Valley and beyond is at least experimenting with Augmented Reality (AR), the technology for projecting digital images across the real world.
Companies like Apple, Facebook, Microsoft, Samsung, the Google-supported startup Magic Leap and even "Fortnite" developer Epic Games all consider AR as the next big computer interface. Microsoft and Magic Leap already have AR glasses on the market. Apple is to work on "smart glasses" that could be introduced earlier this year.
It's pretty clear that all these companies are looking for the next big gold rush in the tech industry after the slow stagnation of the smartphone industry.
You may be right – it's hard to imagine not happening considering the sheer magnitude of the investments every company makes on the market.
The problem is that Augmented Reality is not near the point where the smartphone can be replaced in any way. Strictly speaking, these headsets are too expensive (the HoloLens 2 from Microsoft is $ 3,500), too limited (Magic Leap One and HoloLens 2 have small fields of view), and frankly, do you look like a dork wearing one as I can personally testify:
There's a Big New Thing to Come It's always like that, it's clear that it's not going to be fast enough here to Save the market.