Why Record iPhone Sales Might be Rotten for Apple (AAPL)
This morning Apple (NASDAQ: AAPL) announced a record-breaking weekend for sales of its new iPhone 5S and 5C. In the first 72 hours more than 9 million phones were sold in 11 countries around the world.
"This is our best iPhone launch yet," Apple CEO Tim Cook said in a statement. "Demand for the new iPhones has been incredible."
The pictures of the frenzy plastered all over TV, the web and beyond since Friday back up what Cook is saying.
To me though, all this over-the-top fanfare and even the record-breaking first weekend of sales could actually be cause for concern. Now before Apple lovers pillory me and say that I have no idea what I am talking about, hear me out. I fully concede that Apple is going to make billions in profit from the sale of these new devices and the company is in no danger of becoming Blackberry or Nokia. But the reason I am voicing a bit of doubt is that it seems like Apple is now trying to squeeze every last bit of profit it can out of an aging, shall we call it, iStone.
Let's face it this new iPhone is just an upgrade, a refresh, dare I say a sequel. I am sure that true tech devotees will tell me how wrong I am, that this new device is smarter, faster, revolutionary, etc. But to me and millions like me it seems a lot more evolutionary. It looks a whole lot like the last iPhone and the one before that and the one before that too.
And you know what else looks the same, the way Apple staged the release of the 5S and the 5C. Just like every launch since the first iPhone hit the market we watched people wait in line, sleep outside the store and ham it up for the cameras once they got their hands on their shiny new device. Hasn't Apple seen how the competition makes fun of these events in commercials? It feels like Groundhog Day, expected, cliché. Those are not words that you often see associated with Apple, but right now they seem to fit.
This is no longer the Apple of Steve Jobs. The Apple that seemingly every couple of years rocked the consumer electronics world with a product so innovative that it changed industries forever. He did it with music, Smartphones, computing, the list goes on and on. But sadly since he passed away it seems like that era of innovation has given way to an age of incremental change. I firmly believe that Steve Jobs wouldn't have been satisfied to only pocket billions upon billions on tweaked products alone.
So for me it boils down to a two simple questions: Does Apple become a boring profit machine like Microsoft, churning out upgrades and improvements to its existing line of hits? Or do they find a way to create another "must have" new product, new category, new something that we never thought we needed and we can't live without?
The ball is now squarely in Tim Cook's court. If next year at this time Apple unveils the iPad 6 or the mini2 or Cars 3 from Pixar than we'll know that Apple has become the shiny new creator of utilitarian Tauruses and not flashy Teslas.
I truly hope Tim Cook doesn't become addicted to the easy money of "incrementalism." I hope there are many more game-changing chapters in Apple's future.