Ok, I couldn’t resist taking one more victory lap against this now discredited theory. Partially because I’ve never seen a quote which almost lifts my 2016 blog post verbatim and partially because tech-doofus Ben Thompson was a proponent of this theory.
The dumb theory I’m talking about was about how the rise of software platforms were making your choice of phone manufacturer irrelevant. Ben Thompson used to always cite how in Asia everything was done within their messaging apps. And you could do that from any phone so hardware was in danger of becoming irrelevant.
I heard this theory and immediately recognized it as being 180 degrees wrong. I made the case that software platforms would do the opposite. That they would increase the value of hardware and companies like Apple which specialized in premium hardware would be able to raise their prices. That’s because anything that increases your time spent on your device, increases the value of that device.
Imagine some kind of social shift that caused people to drive MORE miles in their personal car. That increased time in their “devices” would make people think “Hey, since I spend so much time in my car, I could justify an upgrade”. That’s exactly what the dominant software platforms did for smartphones. People realized that they didn’t have to actually visit their bank or store any more. They could do it on their phone. So why not spend a little more on a quality phone?
You’d think that this was common sense. But I’m the only one I ever saw arguing against the prevailing theory. Everyone else in the echo chamber just went along with it as a fact. They even suggested that maybe Apple should bring a low cost iPhone to market to prevent becoming the next Blackberry.
Here is the money quote which came out this week in an article that was about how, for the first time ever, Apple has taken a majority market share in the USA.
“During the pandemic, users also realized the importance of smartphones and started seeing more value in upgrading their devices. Another interesting factor is that this trend in the ultra-premium market is ubiquitous across regions, despite inflationary pressures.” —BGR, 09/02/22
Better late than never I suppose.
I heard this theory and immediately recognized it as being 180 degrees wrong. I made the case that software platforms would do the opposite. That they would increase the value of hardware and companies like Apple which specialized in premium hardware would be able to raise their prices. That’s because anything that increases your time spent on your device, increases the value of that device.
Imagine some kind of social shift that caused people to drive MORE miles in their personal car. That increased time in their “devices” would make people think “Hey, since I spend so much time in my car, I could justify an upgrade”. That’s exactly what the dominant software platforms did for smartphones. People realized that they didn’t have to actually visit their bank or store any more. They could do it on their phone. So why not spend a little more on a quality phone?
You’d think that this was common sense. But I’m the only one I ever saw arguing against the prevailing theory. Everyone else in the echo chamber just went along with it as a fact. They even suggested that maybe Apple should bring a low cost iPhone to market to prevent becoming the next Blackberry.
Here is the money quote which came out this week in an article that was about how, for the first time ever, Apple has taken a majority market share in the USA.
“During the pandemic, users also realized the importance of smartphones and started seeing more value in upgrading their devices. Another interesting factor is that this trend in the ultra-premium market is ubiquitous across regions, despite inflationary pressures.” —BGR, 09/02/22
Better late than never I suppose.
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