It is 2018. In America, it may be what some people might call a golden age. Not because everything is hunky dory (it is not), but the man at the helm of affairs in the land of the free and the home of the brave, the “leader” of the free world, is a man whose idea of grandeur and majesty begins and ends with gold. Literal gold, to be sure; the man has neither the breadth of wisdom nor the depth of feeling to consider that the idea of gold could also be metaphorical.
It’s 2018 – it is the best of times (the economy in Trump’s America); it is the worst of times (everything else in Trump’s America). Everything is gold; nothing is golden. To add to the list of all that’s gold is the crown jewel of American enterprise – according to the latest reports, it is widely expected that the trillion dollar economy that is Apple will release a new line of iPhones on September 12. That is our story of the day and you are listening to Moneycontrol.
Apple said on Thursday it would be hosting an event on September 12 at the Steve Jobs Theater in the company's Cupertino, California, campus, where it is widely expected to unveil new iPhone models.
Analysts believe Apple plans to release three new smartphones this year, including one with a larger display than previous models. Analysts also expect Apple to release an iPhone with an edge-to-edge display similar to the iPhone X but using less-costly LCD screen technology.
Apple's event invitation made heavy use of the colour gold, fuelling speculation on social media that the company plans to launch a gold-coloured successor to the iPhone X, which was made available only in silver and grey last year. Documents filed at the US Federal Communications Commission unsealed earlier this year showed Apple had sought approval for a gold version of its iPhone X, but it never released the colour.
A few hours after Apple's announcement, 9to5Mac, a technology news website, posted photographs of two gold iPhone models stacked on top each other, with a larger-screened model on the bottom. Both models resemble the current iPhone X. The site said the new flagship model will be called the ‘iPhone XS’ and that Apple also plans to release a new version of the Apple Watch with a larger display by reducing the edges around it.
9to5Mac told Reuters the photographs were not mockups and represented Apple's actual planned products but declined to say how it had obtained them. Apple did not respond to requests for comment about the authenticity of the photos.
Apple has for years released its new phone models in the second week of September, and often updates other product lines such as the Apple Watch at the event. The company has already given base-model iPads and some MacBook laptops an update this year.
Apple typically starts selling new iPhones a few weeks after launching them, in time for the holiday shopping season. The iPhone X, priced at $999 and up, has helped Apple beat Wall Street sales expectations.
So, America and the rest of the world, get set go(ld) for a new iPhone XS in gleaming gold.
iPHONE – A GAMECHANGER FOR THE HISTORY BOOKS
This will now be the latest in the long line of iPhones that have hit the market since 2007. The arrival of the iPhone was so seminal a moment that Bloomberg even goes so far as to claim that, “the release of the iPhone is up there with the founding of Standard Oil as one of the greatest business moves of all time.”
During the keynote speech at the Macworld Expo in January 2007, Steve Jobs said Apple Computer Inc would change its name to Apple Inc, signalling a shift from computers to consumer electronics. The event also saw the announcement of Apple’s first smartphone, the iPhone – truly a gamechanger. This new phone shifted 270,000 units in its first 30 hours of sales. In 2008, the company launched the App Store, which sold third-party applications for the iPhone and iPod Touch. It soon touched revenues of 1 million USD per day.
The iPhone was so successful that Apple was the third largest supplier of mobile phones, by revenue, in less than 24 months of its launch. The company reportedly sold over 6 million units in five quarters. The next iPhone, the iPhone 3G, sold 6.9 million units in just the next quarter. 4.4 million iPhones were sold in the following quarter. Apple was now racking up serious numbers and truly on its way to the big leagues. By the end of the 2010 financial year, over 73 million iPhones had been sold.
The premium pricing of the iPhone was paying off for Apple. Even though the phone had a market share barely pushing 4% of all cellphones sold, the company raked in over 50% of all profits from worldwide mobile phone sales. That’s a staggering number.
Apple released the iPhone 4S on October 14, 2011, nine days after Steve Jobs’ death. The device sold a stupendous four million units in 72 hours, eventually selling 60 million in total.
The next year, the iPhone 5 sold five million within 72 hours of its release and racked up total sales of over 70 million units. The 5S had a launch price of 199 USD as did the iPhone 5. By August of 2012, Apple's rising stock price saw market cap touch $624 billion.
The iPhone mania was only increasing. In 2013, the iPhone 5S and 5C sold nine million units in its first 72 hours! In March of 2014, Apple announced that sales of the iPhone brand had crossed 500 million units in total.
In September 2014, it released the iPhone 6 and 6 Plus, with the designs we know all too well today. The starting price for the 6 was a whopping 649 USD. Did the price hurt sales? Well, no. 10 million units were sold over the first weekend. At 649 dollars apiece at a minimum, you do the math. Sure, a large number were contract phones, but buyers end up forking over cash for around two years to the provider, so the actual cost of a contract phone might even exceed the retail price. In any case, Apple makes its money.
In 2015 came the iPhone 6S and 6S Plus, which sold 13 million units in the first weekend after launch. September 2016 saw the launch of the iPhone 7 and 7 Plus, which saw combined sales of approximately 39 million units in the first quarter. Last year, there was no 7S but the iPhone 8 and the iPhone X, the 1000 dollar phone. The iPhone X’s sales have been disappointing, at just 30 million units. Yep, just 30 million. Apple sold a total of 77.3 million phones in the last quarter of 2017.
Such fabulous sales numbers have resulted in Apple crossing the $1 trillion threshold. Steve Jobs’s successor, Tim Cook, now presides over the most valuable business in modern history.
Bloomberg noted that the company’s valuation is on par with the GDP of Indonesia, the 16th-largest economy in the world. It operates at a scale that makes it hard for customers, even governments, to hold it to account. David Yoffie, a professor of international business administration at Harvard Business School, says, “The image of a company of that size certainly yields the perception of a Galbraithian world that many of us have never really considered or conceived of.” If Yoffie says that, you best believe it.
WARREN BUFFETT: APPLE FANBOI
It’s not just academics and industry watchers that have gone on to bestow upon Apple an almost impossible aura. A man who knows a good investment when he sees one - Warren Buffett - too, believes the iPhone is well worth the price if not more. Warren Buffett's Berkshire Hathaway increased its stake in Apple by 5 percent. Berkshire Hathaway is the second-largest holder of Apple shares with a stake worth about $56 billion, according to FactSet.
Buffett explained to CNBC that he loves Apple as an investment “due to the power of its brand and ecosystem, not its short-term financial results.”
When asked if his decision to increase his stake was a result of the spectacular June quarter that Apple has had, he said, "I do not focus on the sales in the next quarter or the next year," he said. "I focus on the hundreds of millions of people who practically live their lives by the iPhone."
Clearly having a fanboy moment, Buffett also called the iPhone "enormously underpriced," saying that it's worth far more than the $1,000 Apple charges.
"I have a plane that costs me a lot, a million dollars a year or something of the sort. If I used the iPhone like all my friends do, I would rather give up the plane. What the iPhone does for you, it’s incredible" he said.
APPLE AS RELIGIOUS EXPERIENCE
From the common man on the street to the suited-booted on Wall Street, everyone wants a slice of Apple. And why not! It’s not for nothing that it became a trillion dollar company. The iPhone X, its crown jewel, will now come sheathed in royal gold. Do you want it? Of course you do. Can you afford it? Like that has ever stopped you. You see… that’s the power of religion. It is the opium of the masses. Apple fanboyism is a religion. It’s science. And do take my word for it – I was a neuroscientist in a past life. BBC, in a documentary called Secrets of Superbrands had neuroscientists explain the Apple fanboy phenomenon. Neuroscientists compared MRIs of Apple fans' brains to those of people who call themselves "very religious" and found that Apple and religion light up the same part of the brain. This means that Apple triggers the same feelings and reactions in people as religion. I am not certain if it was the comparison that led to the design of the Apple stores, but the austerity of these stores has also been compared to churches, with products mounted on pedestals. BBC writers Alex Riley and Adam Boone said, “Inside the store, glassy-eyed staff were whipped up into a frenzy of excitement, jumping up and down, clapping and shouting. When the doors finally opened, they hysterically "high-fived" and cheered hundreds of delirious customers flooding in through the doors for hours on end.”
Indeed, to many, Steve Jobs remains god. And this new (likely) iPhone XS, sheathed in gold, is nothing short of the 10 commandments brought to the people praying at from the burning bush they call the Infinity Loop in Cupertino, California.
Thank you for joining us.