We’re using iPhones for longer. That’s what Apple wants.
Apple was really straightforward a few years ago when Apple VP Lisa Jackson stood on stage at the iPhone XS launch in 2018 to explain the company’s new approach to obsolescence – making iPhones that people used for longer.
The plan seems to be working out
The most recent CIRP data shows that iPhone users are indeed now using their devices for longer. It’s a pattern that’s continued mostly unabated between 2019 to 2021, with a blip in 2022 spurred probably by stimulus payments and the great success of the iPhone 13 Pro.
This year we see that 31% of iPhones in use are three or more years old, and 61% of them are over two years old.
I don’t think Apple is particularly concerned at this. Indeed, the company seems to have planned it like this – it does after all offer free software updates for its devices for up to 5/6 years (it varies), which is way more than competitors provide.
Making things that last is good business
The company also wants people to use phones for longer and then recycle them, because that’s part of the plan there, too. Ultimately, the company wants to make devices from completely recycled 100% carbon-neutral manufacturing processes. And part of this involved making devices people use for longer.
Here’s how Jackson explained it at that time:
“We also make sure to design and build durable products, that last as long as possible. That means long lasting hardware, coupled with amazing software. All of these devices, including the iPhone 5S, run iOS 12, and iOS 12 is designed to make your iPhone and iPad experience even better, even more responsive, faster… just better! And because they last longer, you can keep using them. And keeping using them is the best thing for the planet.”
The company isn’t dumb, of course.
Building out the ecosystem
It knows (and knew in 2018) that in order to transition its business in this way it has to build up its average revenue per user, and it’s achieving this with accessories and services. You may spend a thousand dollars purchasing an iPhone one year, but you’ll hopefully be convinced to pick up AirPods, Apple Watch, or even a Mac the following year.
And you’ll probably find that the need to increase your iCloud storage makes signing up for other Apple Services seem like a good deal. That’s fine, given the much healthier margins Apple generates from them.
Of course, even when you do upgrade your device, you’ll find that Apple dominates the second user market too. That’s what happens when you make devices that last.
Toward Apple as a service?
Those resilient devices continue to pick up great prices. Even then there’s some whispered speculation Apple has some kind of plan for that market. CCS analyst, Ben Wood recently suggested that Apple could, “even offer iPhones through a subscription service to guarantee a more predictable stream of returning devices.”
With this – and the often repeated speculation that Apple may widen its service offerings by offering more hardware on a subscription basis – it is interesting that its recent Final Cut Pro and Logic Pro for iPad releases are both being made available as subscription services.
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