Years ago I watched a documentary about the first MacIntosh. Several people who were on the team that put the original machine together were interviewed. One of the guys, I forget his name, spoke of how bottom line Apple was. He said something to the affect that: “If Apple could find a part that cost even a penny less, they would use it without any hesitation.” Reliability took a back seat.
Previously Here @tt.us
In my humble opinion, Apple has already made some very significant errors in judgement that will, in the longterm, seriously affect customer loyalty and its bottom line. I have opined about some of this before here and here: slowing the hardware refresh cycle for its top end (and less profitable) computers, and dumbing down its software to run on the lowest common denominator micro processor (the iOS devices).
I have repeatedly said that people want and need high powered laptops and, to a lesser extent, desktop machines. The touchscreen device, while incredibly convenient, is impractical for serious work. The touch keyboard is maddening, making the iOS devices unusable for serious text-intensive work. (How many times must the user-base scream for arrow keys?! The finger over text UI is too imprecise and unpredictable!)
Here’s a simple case study: the schools in the state of Maine, a one-to-one laptop initiative state, received 1,718 iPads for students as part of a hardware refresh cycle. These young students, adept at using handheld devices, and their teachers all went into an uproar. They demanded the iPads be returned and replaced with laptop computers. The teachers said, the iPads “provide no educational function in the classroom. Students use them as toys. Word processing is near to impossible…” Another said, “The iPads are largely students’ gaming devices.” The outcry was so great, Apple traded the iPads for laptops. Source: Lewiston-Auburn Sun Journal by Bonnie Washuk
Even Apple’s MacBook Airs are little more than iPads in a laptop form factor. All of their inyards are stamped out or soldered on: Reduce manufacturing cost (increase profit) at the expense of function. Even some of their desktop machines do not afford the addition of more RAM after purchase. The RAM is soldered onto the motherboard.
Want Ethernet on your new Apple laptop? There’s an overpriced “dongle” for that. Want to connect to an external display? There’s an overpriced “dongle” for that. Fewer and fewer ports means less expense in manufacture and additional sales of over priced “dongles.” Apple marketing boasts of “the thinnest machine we’ve ever made.” That translates to, “It costs us less to manufacture and increases our profit margins.”
Oh, and want to play a CD or DVD? There’s a separate purchase for that. Steve Jobs wanted you to depend on iTunes downloads for that content. He said so publically.
But, I get it. The iOS devices are insanely expensive now and with Apple’s carefully minimized design acumen, that translates into: profitable. The sale of iOS devices is Apple’s bread and butter. The more other Apple devices can borrow from that manufacturing model, the more profit Apple can turn. So: stamp those computers out, just like iPads.
But the smartphone and tablet market is now glutted. Worldwide sales are faltering. (Source: Mary Meeker’s 2016 Internet Trends Report at the 2016 Code Conference) Everybody who wants a smartphone has one. New business plans are afoot. Sure: You don’t get to be among the world’s most profitable companies without playing hard.
But Apple is making other serious mistakes.
If you have your iPhone 6 repaired by anyone expect Apple, your device will active a tamper-proof fail safe that permanently bricks the device: makes it forever unusable. Apparently it can not even be restored by Apple at that point. Oops! Gotta buy a new one. This is, of course, to keep your data safe. Oh holy mother of god–riiiiight! This is because Apple wants to own your device from the device’s cradle to its grave. You must depend on Apple for everything device-related. They call it the “walled garden.” This maximizes profits during the worldwide smartphone glut. Besides, I’d be astonished if the government, and Apple itself for that matter, can’t monitor absolutely everything about your device in real time. Privacy? That died so many years ago we act as though we don’t even remember it: pre-Patriot Act. (And then there’s this: No warrant is needed to get your phone’s location data, U.S. appeals court rules.)
Incidentally, Apple is not the only corporation that is trying to take away your right to repair your own property: Right to repair is under assault in New York, and you can save it!
It’s About to Get Worse??
And now Apple is testing the waters to see how much further it can go in increasing revenue streams in the worldwide smartphone glut. They are leaking some interesting possibilities for future revenue growth.
About that Headphone Jack
The rumor (Apple probably leaked to test the waters) is that the next iPhone will not have the industry standard mini headphones jack we have always used for plugging in our headphones. (One of many sources: It’s True: Apple Will Drop Headphone Jack To Make The iPhone 7 Slimmer, Says Source) You will now have to plug your headphones into the “Lightning”1 connector you use to charge the device.
I’m sure this will supposedly drastically improve the sound quality or some such blah, blah, blah… But here’s what it really does: maximizes Apple’s already astonishing profit margin on the devices. I don’t know if you will need a new overpriced Apple or Apple-licensed “dongle” to connect your headphones or if the new iOS devices will completely offload audio processing to the headphones themselves, requiring them, assuredly, to use some Apple-lisenced DAC2. The latter would require headphone manufactures completely rethink headphone manufacturing. Some already are offering such headphones.
To be totally clear: when Apple offloads audio processing, Tim will no longer buy Apple iPhones. I’ll stick with the iPhone I have. It does everything I need. You see, my earphones are very expensive in-ear monitors. I love them. I don’t plan on replacing them unless they get stolen.
Apple sees the future of music: streaming, not owning. (Source: Report Insists Apple Will Eliminate iTunes Store Music Downloads in Future) In other words, instead of being able to purchase your music from iTunes and download it on your machine, just subscribe to Apple Music and have access to everything. Oh, and never mind the fact that some users who have done so found that Apple deleted massive numbers of their personally-owned music files, some even irreplaceable one-of-a-kinds. Why would the user care? You can stream everything we have, as long as we have it and you keep paying the monthly rental fee.
You see, it’s bound to be more profitable for corporate America to rent you music than it is for them to allow you to buy it. Then, every time you want to listen to “your” music, you can use data so your internet service provider can get in on the profit too with all of those impossible-to-understand data limits.
Apple, and others I’m sure, don’t want you to have physical copies of your media. Steve Jobs made that clear when he took away your CD/DVD player. They don’t even want you to have a digital copy of it on your hard drive. They want you to depend on their profit-driven business model for your music needs. It won’t just stop there.
Apple will announce next week at the 2016 WWDC (Source: News: Schiller: Apple moving toward App Store subscription model) that they are also going to change the App Store from a purchase model to a subscription model. In other words, you will rent your software, too. You will not own it–not that we probably ever have anyway. Have you read those terms of service? They are unbearably long and use ridiculously arcane language for a reason, you know.
I have resisted renting software for as long as Adobe began their Creative Cloud software rental arrangement. In fact, I have replaced Adobe’s Photoshop software, as I have blogged about before (here and here and here). I will not rent software.
As long as I own a piece of software, I can continue to use it for as long as I want without paying any more money for it. If the developer offers a significant new feature set, I will upgrade. This tit-for-tat consumer/company working relationship compels the market to meet customer expectations and not just focus on profit margins. If customers rent your software on a month-to-month basis, the incentive to offer new features and stability improvements is reduced.
When Adobe announced their software rental arrangement, I wondered how long it would take others to follow suit. I wondered if this was the future of software distribution. I wondered when the App Store would start doing the same. That day has now come.
New Revenue Maximization Scheme
You get people to depend on your product, and then you no longer allow them to own it. They must rent it from you. And, they will, because they have grown to depend on it. You only allow them to use it when they pay you every month. Trust me, the price of rental never goes down. Then, once customers are accustomed to the monthly bill, you raise the rates. The consumer no longer owns their digital home, merely rents it from the very powerful digital overlords.
These are profound changes with enormous longterm ramifications.
No! I say, No.
I will not participate. I will do everything I can to fight what I believe will inevitably become digital slavery. At present, my digital tools will do almost everything I need them to do. So, if I need to lock down my operating system on my existing hardware and keep it running as is until it just burns up, that’s what I will do. If I need to move to open source, that’s what I’ll do. If I need to go back to purchasing CD’s to own my music, I will.
I have seen the digital future, and it is now bleak. It is restrictive. It is controlling. It is designed to maximize profit. It is designed to maximize dependency. It is anything but democratized. It is time for me to say: this is too much to embrace as acceptable.
If enough of the market joins me in saying “no,” things will change.