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New iPhone battles Steve Jobs' surprising mistake




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During the rapid growth phase of the iPhone, Apple followed the strategy of Steve Jobs Hold high the price of hardware, but keep the price of software and services as low as possible, which makes Apple's sales and profits record-high, and now the hardware market is saturated, iPhone sales are not rising any more, and Tim Cook's Apple has been dogging for years turn around to build a new business model.

Steve Jobs's strategy had a flaw, and eventually there is no room to grow.

Steve Jobs (Creation of Ben Stanfield / Flickr) Commons) Ben Stanfield, Flickr CC

In terms of hardware prices, Apple has lost its unified approach around the world, with substantial price cuts in China to tackle declining demand alongside efforts In India, the average selling price has been increased by removing the cheaper wallets from the portfolio. In the US and in Europe, Apple has offered significant discounts for the iPhone, but through the trade in older cell phones.

It's getting harder to keep the price of hardware high. The exchange of market shares to maintain a higher price can not last forever. Something has to change.

Customers gather during a class to learn how to use their iPhone in an Apple Store on January 7, 2019 in Beijing, China. (Photo by Kevin Frayer / Getty Images) Getty

Tim Last year, it was clear that he believed the future would be "service-first" for Apple, with the goal of reducing service revenue from $ 41 billion in 2016 to $ 82 billion. To double dollars in 2020. Of course, there is no indication of the profit margin offered by the various services, so it is questionable whether the App Store, a streaming TV service or all-you-can music subscriptions can offer the same return as the iPhone in its heyday.

But there is a clash at the heart of this software-first strategy … you need a lot of users to make it work. Because of this, software-based companies generally tend to "give away" important elements to build an audience (just look at Google's efforts to grow with Android.)

Apple wants a profitable arm for software and services. It also wants to keep prices high on the hardware needed to access these services. I do not think it can do both. So, what will it be?

Now, read why China's lack of demand highlights Apple's broken strategy …

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During the rapid growth of the iPhone, Apple followed Steve Jobs's strategy Hardware high, but keep the price of software and services as low as possible, which makes Apple's sales and profits at record levels Now, the hardware market is saturated, the iPhone sales are no longer rising and Tim Cook's sales rise Apple must turn years dogmas, to build a new business model.

Steve Jobs' strategy failed: at some point there is no room for growth The global approach, with substantial price reductions in China to meet demand and India's efforts to raise the average selling price By taking the cheaper phones out of the portfolio, Apple has seen considerable growth in the US and Europe The price advantages offered scouts on the iPhone, however, through trade-in in older mobile phones.

It's getting harder to keep the price of hardware high. The exchange of market shares to maintain a higher price can not last forever. Something has to change.

Customers Gather During a Course to Learn How to Use Their iPhones at an Apple Store on January 7, 2019 in Beijing, China (Photo by Kevin Frayer / Getty Images) Getty

Tim Cook has clearly shown in the past year that he believes that the future will be "a first service" for Apple, with the goal of increasing service revenue from $ 41 billion in 2016 to $ 82 billion Of course, there is no indication of the profit margin offered by the different services. Therefore, it is questionable whether the App Store, a streaming TV service or All-you-Can music subscriptions can offer the same returns as the iPhone in its heyday. 19659016] However, there is a conflict between this software-first strategy … you need many users for this to work. Because of this, software-based companies generally tend to "give away" important elements to build an audience (just look at Google's efforts to grow with Android.)

Apple wants a profitable arm for software and services. It also wants to keep prices high on the hardware needed to access these services. I do not think it can do both. So, what will it be?

Now, read why China's lack of demand highlights Apple's broken strategy …


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