Well, just when you thought maybe 2019 would be a better year, here comes Apple with the revised guidance that their earnings for fiscal Q1 will be well under their previous guidance. Which at last check has the stock down 10% after hours, at a time when it’s trading over a third below its 52-week high. I guess my new financial advisor got me out from AAPL just in time, well done new guy, but in the grand scheme of things this is not promising.
One Twitter wag followed up the statement with words to the effect of “that’s a long way of saying you overpriced the phones.” Which is dead on. The cheapest current iPhone is now $750, an all-time high, and all the mealy-mouthing around the evolving market won’t change the fact that were it not for work providing me an iPhone X that I only half tolerate, I would be rounding off my third year of being satisfied with my iPhone SE from May 2016. It has a new battery, and it does tolerable well under the circumstances, not being afflicted with nonsense like FaceID and still capable of doing everything I need a phone to do without forcing me to set my drink down.
But Apple’s also getting tagged bad by the trade war – and not just because of tariffs, but because they bet the house on China as a future market. And like so much of the wider world, they bet on a bad horse. The lure of 1.3 billion future customers was so blinding that they never considered that these customers live in a totalitarian state with a command economy, and that they might prefer – or be encouraged to prefer – home-grown solutions for everything. And when WeChat is basically the private ecosystem of China, it doesn’t much matter how you get to WeChat, which makes Apple a luxury bauble rather than a functional necessity. Bad bets all around.
And this is alarming, because I’ve made a career in Apple support. Every nickel I’ve earned since September 1997 was earned either at the craps table, the sports book or in service and support of Apple products, one way or another. And now the iPhone is their principle trade, and the iPhone has become the new Tesla: an overpriced version of something that can be bought cheaper with a less shiny surface that will get you where you’re going just as fast. My cousin is out roaming the world with a Moto G6 on GoogleFi, which he got for a hundred dollars. You can’t buy any iPhone for a hundred dollars. You can’t buy any iPhone for three hundred dollars. And because the iPhone was good value for money, now your three year old iPhone is just fine to use for another year.
Maybe this will cause the powers that be over at Apple Park to blink hard and rethink hard. Maybe the fine chiropractors at the health center will be able to extract Jony Ive’s head from up his ass before he turns into a Klein bottle. Maybe this will pave the way for a nice new India-built iPhone SE2, or maybe even an X-Minus. Maybe the company will figure out how to last long enough that I’m not suddenly left high and dry at age 58 with no job prospects and no way to retire for another ten years.
They’d better. This new MacBook Air is nice. I’d hate to have to go to something else.