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Consider the iPod: the differentiation was about things people would care about, like size, capacity, portability, style, etc. You weren't made to feel cheap just because you entered at the lower price points. You wanted an iPod Mini, and it made sense that it cost less than the Classic: you were still getting "the best" version of the thing you desired.

Same story with the Mac: buying the iBook didn't make you feel like you were cheaping out, you were making a conscious choice for what you wanted, not buying "last year's PowerBook".

With the phones it's very different. Buying an old phone doesn't make you feel good, it just makes you think "I know this isn't the best, but it's all I could afford", and that's very un-Apple feeling -- especially when you still have to pay quite a lot.

Apple has apparently boxed itself into a corner, though: this is its second attempt to segment the line (the 5c being the first) and both have failed because they didn't feel like different things, they just felt like cheaper ones: the 5c was just a plastic 5S, and the XR is basically an XS with cheaper camera and screen.

So how else can they differentiate? Making a small phone won't really fly - while I'd love an SE-sized XS, the Chinese market they need to win back wants its phones big.

That only leaves the margin to cut, and that's a shibboleth. You can see why they'd much rather focus on services to escape this fix.

Yes! You hit the nail on the head!

The iPhone needs to be split between iPhone Mini, iPhone and iPhone Pro, instead of current model of “last year”, “this year medium” and “this year large”.

As much as I wanted to love the iPhone SE, it always felt like last year’s model. It wasn’t a differentiated product that had a proper update cycle. A lot of people in the community were hoping for a proper update to the SE.

I also wanted to love the 5C because I actually preferred the design over the metal iPhone, but they hindered it with last year’s specs. I was always hoping they would break out a proper model line from the 5C, but it died with the 6.

How often do people find in practice they have to think about specs at all? I'm typing this on an SE. It is, of course, literally last year's phone (two years) but both when I bought it and now, there's nothing except the camera that doesn't feel well above adequate (and the camera, while missing some neat low light features, is adequate) and there's a few things that feel optimal about it that simply aren't available in current models (form factor, headphone jack, and price).

I never think about specs/performance... much in the same way that I haven't thought of specs for the mid 2012 MBP I bought years ago. What are people doing with their phones that drives a sense that last year's specs aren't good enough?

I don’t think it is the specs or even the real world performance, but rather the unease/sense of compromise you feel spending $450 for an “outdated” phone regardless of the actual user experience.

On the other hand, people can spend $550 for OnePlus 6T, a current generation phone, and feel better about their decision.

Your question reminds me of a humorous quote - "I use Gentoo because I'm a speed freak - I can't stand the thought that some of my packages might not be running as fast as they could be.".

PS: The above quote is just one of the gems from https://funroll-loops.teurasporsaat.org/ - a humorous portal to a lost world from the 90s - 2000s (ie the gentoo subculture).

Fun page, I remember those times. Some of the quotes aren't so ridiculous, like:

>"I notice that my disk does a whole lot of thrashing when I boot up. I have a lot of stuff that gets loaded into memory every time I boot, like X11, ion2, Firefox, Eterm, Thunderbird, etc. It seems to me that putting all of the files necessary to those apps in a contiguous section on the disk and loading that into memory in one shot would be a whole lot faster. Is there a way to do this? Is it stupid?"

That's a good idea! It's kind of what Windows Prefetch feature does.

(And in case anybody's interested, the utility e4rat (ext4 read ahead... tool?) does exactly this)

> What are people doing with their phones that drives a sense that last year's specs aren't good enough?

Wanting to play the new game showcased in the announcement. and other news games that come out, that requires the latest phone to play smoothly and without utterly destroying my battery in under 2 hours.

EDIT: That said, I care less about performance specs and more about physical size, and so I too am still on an iPhone SE

Doing OS updates, taking pictures and storing stuff on limited storage.

> As much as I wanted to love the iPhone SE, it always felt like last year’s model. It wasn’t a differentiated product that had a proper update cycle. A lot of people in the community were hoping for a proper update to the SE.

I have an SE and appearance aside I disagree. It had the guts of the current model including touch id and performs quite well for me.

Now, sure, it feels a little bit left behind. Maybe. It's still fast enough to run the apps I want. But, let's face it, all of the updates that the 7/8/Xfoo have had are updates I don't want.

The problem I've got with Apple is that they don't have any new products I want. I just had them replace the battery on the SE (which was a clusterfuck in its own right) and I just bought a refurb 2015 MBP. Granted Apple probably made more money off the sale of a refurb than they would've off of a new unit... but if the lineup hasn't improved in another six years I'm off to Linux on the desktop.

> It had the guts of the current model including touch id

IIRC iPhone SE does not have the second generation Touch ID sensor that iPhone 6s does.

Yeah the SE doesn't have the updated reader, the haptic system or 3D touch. Having gone back and forth between my SE and a 7 for work, I really only miss the 3D touch.

It doesn't have a barometer, either.

Agreed. There should be three distinctive line, and updated each year accordingly.

iPhone S - 5.8" / 6.8" OLED, Face ID, Stainless Steel, Best Camera, 4x4 Antenna. Tri- Camera

iPhone R - LCD, Under Screen Touch ID? Or Face ID with a larger bezel at top or bottom to save cost. Aluminium, 2x2 Antenna. Double Camera

iPhone E - Basically the traditional iPhone design with Touch ID with slight update in Design. Single Camera

The three model will then just iterate on their own. May be the iPhone E could even be unapologetically Plastic!.

Although I think Apple will just continue its current model until things really break.

The 5C was much more like the 5 (same CPU, etc) than the 5S. Their previous strategy had been "sell the previous year's phone for cheaper". The 5C was basically the same strategy, except for that one year they put it in a new colorful enclosure.

It was a nice looking phone but a tough sell because the 5S was such a big leap (first 64-bit CPU) over everything else. The 5S is over 5 years old and still supported by the latest iOS.

>So how else can they differentiate? Making a small phone won't really fly - while I'd love an SE-sized XS, the Chinese market they need to win back wants its phones big.

Do you remember, back in the day, when the smallest IBM thinkpads were way more expensive than the less-small IBM thinkpads?

I understand big phones are king if you only have one device. If I wasn't carrying like five devices all the time, I'd also want a giant phone-tablet, and I guess these days, most people don't have computers, and if I didn't have a computer, I'd want a really giant phone. But I am carrying five devices all the time, and I do have desktops everywhere I spend significant time, so I want my phone to be small and easy to operate with one hand.

As far as I can tell, there's a pretty big correlation between having a good income and having multiple devices. What I'm saying is that giant phones can be seen as... kind of the low end of the market.

And it's not like apple needs to stop making giant phones; they just need to make a small phone for the high end. That, or they need to upgrade functionality on the watch to the point where I can just use the watch for everything, but as far as I can tell, app developers are moving in the other direction (Last time I dropped off my phone for repair, I found that lyft had disabled it's watch app, and the uber watch app doesn't work reliably without the phone nearby. I mean, I got the uber watch app working once I got my phone back, but it's just not designed to function as the backup for your transportation app that I wanted. It was kind of annoying; I ended up calling a friend on the watch, 'cause txt messages weren't working, either. Walking around shouting into my watch like I thought i was dick tracy)

Personally, I'm actually pretty happy paying apple prices for a new phone every two years or so, but you've gotta give me a reason. I mean, if you came out with a really nice small phone, I'd even be willing to pay big phone prices for it; I'm not really that price sensitive when it comes to things like my cellphone, but I really don't have a lot of desire to buy the new phones, just 'cause they are all so big, and as far as I can tell, they don't do anything I want any better than my iphone 7. (I don't hate face ID, but as far as I am concerned, it's not any better than the fingerprint)

If Apple came out with a 3d-touch capable iphone SE sized phone with lots of memory and really good cell reception/networking features? Yeah, I could see me paying a grand for it.

I agree totally. But this is partly Apple's bind: a phone like you're describing appeals to rich Westerners with multiple primary devices and that's just too small a market for them now. Their pressing corporate need is to make a device that will help them grow in China, maximising their take from the billions who don't have multiple devices.

In the olden days, when Apple was much smaller, they were ironically freer to just make the best device possible because success would be meaningful in very small markets. The OG iPod saved them despite selling relatively tiny numbers. Nowadays, markets that used to matter significantly to Apple -- education, media, creatives -- are allowed to wither and die because they are a blip on the bottom line.

I don't see what could change that, though. They now prioritise growth/financials/share price over pure products in a very calculating way, but what corporation doesn't? You need an exceptional mandate to do otherwise, and only the Bezos's and Jobs's of the world get those.

So the pity is that as a result we'll continue to see Apple pushing hard into services and (probably) media, because that's where it can smell growth. That might keep the numbers up, but I suspect it's going to transform what Apple is even further away from the "make great products" company we knew into ... something else. (Probably something less great, given their track record with services, tbh.)

too small a market? The US still has a staggering share of world GDP, and the per-capita GDP (remember, PPP doesn't matter from Apple's perspective) is much higher in the USA. I mean, the per-captita GDP in China is under $10K/yr. Not a lot of those people are gonna spend a grand on a phone.

I think this is one of those situations where you count dollars rather than heads.

My understanding is that the "next billion users" push that all the big companies are doing is a bit like putting macs in schools. It is a long-term plan 'cause yes, the developing world is poor right now. maybe those people who are poor now won't be poor in the future, and if they know how to use your ecosystem, that's great for you. It certainly seems like a good idea, but I don't think it's where you make your money today.

I really think if you were serious about that plan, you'd come out with a giant low-end phone; You remember the thinkpad W series? something like that. big and clunky and cheap. Apple needs an iphone 5c level cheap plastic reskin of last year's big phone for that.

It's the problem of subsitutes that matters in the US: what do rich people who want a small premium iPhone do when they can't get one? They likely don't go to Android, there isn't a small phone worth a damn there. They probably buy an iPhone, right? Likely an XS, since that's the smallest of the new phones. Apple isn't losing anything on them.

The market you're really talking about them capturing with a small premium phone is "rich people who have multiple devices and want a small phone and when they can't get one they buy an Android phone or make do with an SE". I'd wager that's small in most terms, certainly in Apple terms -- whether you're talking dollars or heads.

But what do the top-end Chinese consumers do when Apple doesn't have a phone that appeals to them? They buy one of the other flagships that run WeChat, and Apple loses them. That's big in Apple terms, missed-expectations-warning big.

Yeah, this is right. The interesting thing is that this problem doesn't seem to exist with the Macbook line, where there's clear differentiation: you can get the super blazingly fast monster, or you can get the really tiny one that actually needs to be less powerful in order to fit in the tiny case without having like 10 seconds of battery life. Though the Macbook/Macbook Air thing they just introduced muddies that a little bit...

Agreed, AFAIK the only difference between the Macbook "escape" and the Macbook Air is that the MBA has TouchID and the classic shape.

Probably means they'll discontinue the non-touchbar MBP in the next round.

> the only difference between the Macbook "escape" and the Macbook Air is that the MBA has TouchID and the classic shape

MacBook Air has newer processors.

Well put. Also when Jobs returned he drastically simplified the model offerings, one reason being that Apple is supposed to represent high-quality simplicity. Having a ton of model options for the iPhone is not in line with that.

The same went for the MacBook lineup. I don't want a Retina display, quad core, etc. I'll live with a lower spec for a $999 machine. And as a bonus my battery lasts longer!

By comparison I think the iBook was always a crippled version.

The iBook was fairly comparable to the PowerBook in specs but it weighed more, was larger, and the plastic was less durable than the magnesium case.

For $999 or $800 old/refurbished, it was the only small (5 lbs) laptop you could get with a decent GPU back then. The pentium 4 stuff of the day was huge and power hungry and the Centrino line didn’t support it for some reason.

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