5 ms·

Linkbait aside, if Apple's gross margin is decreasing, which it looks like it is, its most likely because of the iPad which carries a lower profit margin. So w

Linkbait aside, if Apple's gross margin is decreasing, which it looks like it is, its most likely because of the iPad which carries a lower profit margin. So when iPad sales become a larger portion of total sales, gross margin goes down while total profits still go up.

steverb 14y ago
I think that the rise of Android is enabling carriers to push back a lot harder on the subsidies too. From their point of view, there's good demand across the board for Android phones and they can sell them with better profit, which would probably make them more inclined to negotiate harder with Apple. I wouldn't be surprised if one of the carriers threatens to skip the next iPhone release.
- Tloewald 14y ago
  The carriers make way more money off iPhone customers so not likely. Also, in general, no-one switches carriers to get random android devices. They will leave carriers to get iPhones. As android increases share of the phone market (vs. smartphone market, right?) the percentage of mobile web traffic from android has, if anything, dropped. This suggests android is winning big in the "I don't care what phone I get" market. This isn't the fat juicy part of the market.
  - steverb 14y ago
    They USED to make way more money. I don't know that that is still true, based on gripes from sales people about commissions I'm pretty sure it's no longer true. I do know that carriers are pushing Android (and even Windows) phones a lot harder than they were a year ago.
    - Tloewald 14y ago
      Sales people's commissions tend to be inversely related to customer demand. iPhone demand outstrips supply to incentivizing salespeople to sell iPhones makes no sense. Think the numbers have dramatically changed since August? http://www.forbes.com/sites/ycharts/2012/08/10/can-anyone-help-these-poor-wireless-carriers-break-their-addiction-to-iphones/ http://www.forbes.com/sites/ycharts/2012/08/10/can-anyone-he...
      - steverb 14y ago
        As far as I can tell, those charts don't break down the usage between iPhone and others. Doesn't matter though as your first point trumps it. But good point about the reverse commissions arrow. I'll have to go check what current commissions are on the iPhones vs previously.
        Tloewald 14y ago
        Agreed about the figures as they can only be inferred. asymco has done some analyses along these lines in the past but I couldn't find one in a hurry (and it might not have been recent). Other indirect measures do not show android is doing better as a "smart" phone (I.e. generator of demand for expensive cellular plans).
  - deleted 14y ago
    [deleted]
  - anony_mouse 14y ago
    Whoa, foreach(sentence in yourReply) { Citation.needed = true; } if(Citation.needed) { Return YouADouche(); }
Tloewald 14y ago
Big if. Apple has made a generic margin warning in its q4 press release, but did not make a thing of it as in past instances. Q4 was down to 40% from 40.3% a year ago. Do you think Apple plans to break with years of tradition and start pumping its forecasts? The two questions are whether the iPad mini is actually a low margin product — but if Google can sell the Nexus 7 at break even for $200 this seems pretty doubtful to me (the iPad screen and camera notwithstanding) - and whether Samsung's processor price hike will have a meaningful impact.

steverb 14y ago

I think that the rise of Android is enabling carriers to push back a lot harder on the subsidies too. From their point of view, there's good demand across the board for Android phones and they can sell them with better profit, which would probably make them more inclined to negotiate harder with Apple. I wouldn't be surprised if one of the carriers threatens to skip the next iPhone release.

Tloewald 14y ago
The carriers make way more money off iPhone customers so not likely. Also, in general, no-one switches carriers to get random android devices. They will leave carriers to get iPhones. As android increases share of the phone market (vs. smartphone market, right?) the percentage of mobile web traffic from android has, if anything, dropped. This suggests android is winning big in the "I don't care what phone I get" market. This isn't the fat juicy part of the market.
- steverb 14y ago
  They USED to make way more money. I don't know that that is still true, based on gripes from sales people about commissions I'm pretty sure it's no longer true. I do know that carriers are pushing Android (and even Windows) phones a lot harder than they were a year ago.
  - Tloewald 14y ago
    Sales people's commissions tend to be inversely related to customer demand. iPhone demand outstrips supply to incentivizing salespeople to sell iPhones makes no sense. Think the numbers have dramatically changed since August? http://www.forbes.com/sites/ycharts/2012/08/10/can-anyone-help-these-poor-wireless-carriers-break-their-addiction-to-iphones/ http://www.forbes.com/sites/ycharts/2012/08/10/can-anyone-he...
    - steverb 14y ago
      As far as I can tell, those charts don't break down the usage between iPhone and others. Doesn't matter though as your first point trumps it. But good point about the reverse commissions arrow. I'll have to go check what current commissions are on the iPhones vs previously.
      - Tloewald 14y ago
        Agreed about the figures as they can only be inferred. asymco has done some analyses along these lines in the past but I couldn't find one in a hurry (and it might not have been recent). Other indirect measures do not show android is doing better as a "smart" phone (I.e. generator of demand for expensive cellular plans).
- deleted 14y ago
  [deleted]
- anony_mouse 14y ago
  Whoa, foreach(sentence in yourReply) { Citation.needed = true; } if(Citation.needed) { Return YouADouche(); }

Tloewald 14y ago

Big if. Apple has made a generic margin warning in its q4 press release, but did not make a thing of it as in past instances. Q4 was down to 40% from 40.3% a year ago. Do you think Apple plans to break with years of tradition and start pumping its forecasts? The two questions are whether the iPad mini is actually a low margin product — but if Google can sell the Nexus 7 at break even for $200 this seems pretty doubtful to me (the iPad screen and camera notwithstanding) - and whether Samsung's processor price hike will have a meaningful impact.