
Lasts Longer (2.0) - zdw
http://www.asymco.com/2020/03/18/lasts-longer-2-0/
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nullspace
Skimming through the numbers in the article[1] linked to from here, it's very
interesting to see the dynamic that Apple has managed to create around
depreciation.

A 2 year old iPhone can still be traded-in at roughly 50% of the value
(whether to Apple or a third-party). The effect that this creates is that it
becomes quite reasonable to buy the latest iPhone every two years after trade-
in. I'm sure this has a big impact on new device sales, one of the factors as
to why Apple beats records every year.

On the flip-side, I believe the reason they are able to do this, as the
article here notes, is that their phones just last long (hardware/software).
My iPhone 8 is not very old, but I'm not planning to stop using it for another
2-3 years at least (unless it shatters). In some ways, this reminds me of
ThinkPads, just in terms of how long they can serve their purpose.

I'm honestly getting kind of "bored" of Apple devices, but I fear Android
devices may not have the same solid 5 - 7 years of support, and as is evident
from this article, trade-in value.

[1] [https://www.bankmycell.com/blog/cell-phone-depreciation-
repo...](https://www.bankmycell.com/blog/cell-phone-depreciation-
report-2019-2020)

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kbenson
The major android phones (including Google's) only have 2-3 years of support
usually. I'm not sure if that also follows with Android One devices. That
said, if you're careful with your selection, you can get a repackaged AOSP
(e.g. LineageOS) for your hardware and get extended support out of that
(unfortunately my Samsung Galaxy S6 is a particular blend of components that
never seems to be supported).

I actually wouldn't be adverse to buying yearly support for my phone through
something like LineageOS if it was available, in case someone thinks they can
make a go of that business. There's a lot of older Android phones out there
that are really only missing good support to be usable. Especially the o es
that support easy battery replacement.

~~~
asdfasgasdgasdg
Also worth noting that the pixel 3, the phone with the highest drops, had
extremely deep discounts associated with Google Fi. At one point you could get
one for free. That surely affected the prices on the used market. Of course,
the fact that Android phones age less well is probably a factor too.

~~~
lonelappde
There's also the factor that Google subsidizes Android phones because they
profit from you using the phone to view ads (and buy apps). Apple of court
profits from you buying apps. Apple users buy more apps. Not sure which users
view/click more ads.

~~~
kbenson
Why is Android subsedize but iOS boy? When is the last time someone paid for
iOS or an update to it? The play store functions to make money for Google
exactly the same way the app store does for Apple.

Apple makes more money from their app store (about twice as much it seems[1]),
but it's not correct to imply Apple makes money from their app store but
Google doesn't.

1; [https://www.fool.com/investing/2019/10/11/as-usual-apples-
ap...](https://www.fool.com/investing/2019/10/11/as-usual-apples-app-store-
revenue-leads-google-pla.aspx)

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Gravityloss
Looking at the Apple's showcase for their newest OSX version, Catalina [1],
you see it's mostly about some consumer subscription services and integrating
with other Apple devices. Also some pretty cynical data lock-in helper
applications. There's nothing in there that is relevant for me, doing
professional work or doing music stuff as a hobby.

1:
[https://www.apple.com/macos/catalina/](https://www.apple.com/macos/catalina/)

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valuearb
People commonly misunderstand the value proposition of smartphones. They spend
$500 a year for service, but view spending $1,000 for a top of line phone that
maximizes the value of that service as excessive, even when that phone only
costs $250 a year in depreciation. So instead they buy a $500 phone, costing
$150 a year in depreciation, with a worse screen, camera, cpu, etc that they
use for hours every single day.

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lonelappde
What am I misunderstanding about paying $100/yr less for something that serves
my needs?

Does iPhone make my phone calls more phoney?

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californical
If all you do is make phone calls, then of course not. But for many people,
their phone is their main general computing device. Everything from light
photo editing to games to social media.

I am an Android user but I like buying products once and using them until they
die. I have a pixel 2 that I got new less than 2 years ago that will be
reaching EOL soon, which is really surreal. Buying an iPhone that can last 5+
years sounds like a real benefit -- and would actually save me a lot of money
over the long term even though it costs more than 1.5x as much as my pixel.
That sounds like a real benefit for me personally, and I may be switching to
iPhone next, if only for their excellent history of long term support (I
prefer Android's software)

~~~
lonelappde
It doesn't last 5 years if you drop it on concrete (maybe newer phones do) or
wash it on laundry.

There are risk-resuction benefits to only expecting 2-3 years from your phone.
Especially if you are a heavy user of your phone and subject to (cough)
battery degradation and CPU throttling.

Pixel 2 is also $150 refurb in excellent condition, so thank you whoever is
buying it new.

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swampthing
There is a strong network effect for phones. This seems like a smart way for
Apple to maintain its market positioning as a premium offering, while enabling
growth of its market share amongst people who can’t afford their new phones,
thus making their network more valuable.

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ksec
There is a few important things to note here before people jumping into
conclusions "Flagship ( or not Flagship ) Android dropped in value roughly
twice as fast as Apple’s "

First thing being Android vendors _Choose_ to devalue their phone faster. The
Trade in "Value" is not _only_ governed by the Market "perceived" value, but
how much it was still _wholesaling_ at the end of specific period of time.
This is by and large a Vendor's decision.

If a Samsung S20 was Retailing $699 but wholesaling at $599 giving retail $100
profits, but at the end of the period drop the price to $599 but wholesaling
at $449, giving additional profits ( $50+ ) to clear out stocks. No firm will
buy your 2nd hand S20 for anywhere close to $449, despite its retail price is
still going for $599.

Giving 2nd hand phone a 80% discount of Wholesale price, you end up with at
best $360. ( Assuming perfect condition ), All of a sudden your phone only
worth half of its price you bought it for.

( The above numbers are for illustration only )

Compared to Apple _extremely_ stringent pricing and minimal margin to
retailers. Apple prefer to give a package bonus if you achieve your sales
target. Something Samsung has also been following in recent years. The
wholesale pricing of iPhone hasn't drop much at all. And hence their 2nd hand
value tends to be higher.

The question then obviously comes to why dont Android vendors keep their
wholesaling price higher. For a few reasons, they need to give higher profits
to retailer to help them push for sales. A sales will need higher commission.
As far as I know, no Android Vendor command the same market power as Apple.
Trying to keep Wholesaling price up is basically giving other Android Vendor
opportunities for market share. Android can switch brands, iPhone users switch
models.

Second being Apple's Supply Chain Management is a Just in Time operational
marvel that no one has yet been able to copy. At the end of the cycle when it
is hard to judge supply and demand, you will have Phone sitting in warehouse
that either do not get sold and zero cash returns, or lower the wholesaling
price and try to clear it out so you have better cash flow.

