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Your Love of Your Old Smartphone Is a Problem for Apple and Samsung (wsj.com)
The smartphone industry has a culprit to blame for slumping sales: Its old devices remain too popular. From a report: Flashy phones of yesteryear, particularly Apple's iPhones and Samsung's Galaxy S handsets, are getting refurbished, and U.S. consumers are snapping them up. Many shoppers are balking at price tags for new phones pushing $1,000, and improvements on latest launches in many cases haven't impressed [Editor's note: the link may be paywalled; alternative source]. As more people hold on to devices longer, new smartphone shipments plunged to historic lows at the end of 2017. "Smartphones now resemble the car industry very closely," said Sean Cleland, director of mobile at B-Stock Solutions, the world's largest platform for trade-in and overstock phones, based in Redwood City, Calif. "I still want to drive a Mercedes, but I'll wait a couple of years to buy the older model. Same mentality." Another trend borrowed from the car industry that has helped consumers get around sticker shock: leasing. Instead of buying new phones, Sprint and T-Mobile allow subscribers to effectively lease them, allowing them to trade up for the latest device. That option, though, hasn't yet gone mainstream.
[...] Second-hand phones long found their way to Africa, India and other developing markets. But now, U.S. buyers represent 93% of the purchases made at second-hand phone online auctions run by B-Stock, compared with an about-even split between the U.S. and the rest of the world in 2013. Samsung and Apple together sell more than one out of every three phones globally and capture about 95% of the industry's profits. U.S. consumers, spurred by two-year carrier contracts and phone subsidies, were upgrading every 23 months as recently as 2014, according to BayStreet Research, which tracks device sales. Now, people are holding onto their phones for an extra eight months. By next year, the time gap is estimated to widen to 33 months, BayStreet says.
[...] Second-hand phones long found their way to Africa, India and other developing markets. But now, U.S. buyers represent 93% of the purchases made at second-hand phone online auctions run by B-Stock, compared with an about-even split between the U.S. and the rest of the world in 2013. Samsung and Apple together sell more than one out of every three phones globally and capture about 95% of the industry's profits. U.S. consumers, spurred by two-year carrier contracts and phone subsidies, were upgrading every 23 months as recently as 2014, according to BayStreet Research, which tracks device sales. Now, people are holding onto their phones for an extra eight months. By next year, the time gap is estimated to widen to 33 months, BayStreet says.
If I think $1300CAD is too expensive for a MacBook Air, you can imagine what I think about iPhone prices.
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Want to sell your new model for $1,000? For me it's simple. Put back the audio jack, make it a bit thicker and stronger. Add the capability to routinely swap micro-SD cards and I'll gladly pay $1,200. I feel like the new smart phones are still trying to market sexy styling ahead of swiss army knife capability...much like cars.
I don't understand consumers. The iPhone 8 is so much better than the iPhone 6. It is 2 better. Who wouldn't drop $800 for 2 better?
They could release OS updates, that intentionally degraded performance of old phones, and when caught they could just claim that they did it to help out people with old batteries?
Naw... too far fetched.
"Have you ever thought about just turning off the TV, sitting down with your kids, and hitting them?"
It is more of the fact that consumers are balancing their need for features with the price they are willing to pay for those features. Once the price tag zoomed over $900 for a smartphone, a lot of people started waking up from the reality distortion field. Why pay $1000 for something when you can get the features you need at a price you find a lot more reasonable?
It's funny because the car industry now looks like the old smartphone industry!
My Nexus 6 is only 2 years old and Google decided it won't get security updates in Oct of 2017. Their suggestion was to pay $900+ for a new pixel phone, so I gave them the middle finger and breathed new life into my N6 by installing LineageOS. I'm glad I did, it has been working great. Google's attempt to forcefully deprecate my phone ahead of its time just hardened my resolve to fight tooth and nail to keep it alive as long as possible.
You are 5 (iPhone X = 10 - 5 = 5) behind. You don't want to be behind. You want to be at the forefront. When Apple comes out with their next phone you will be 6 behind. You are falling even further behind.
$200 is my limit for a smartphone.
I want:
-replaceable battery
-headphone jack
-usb and bluetooth, WiFi and 4G
-Camera
-GPS
It just has to be "good enough". The camera in the smartphone is crap, the speakers are crap, the software is crap, even on the so-called high end models.
I don't need NFC, I don't need to Pay Apple, or Pay Samsung, or Pay Google to pay for things.
I need to make and receive calls.
I need to take "good enough" photos, I have an SLR for everything else, or even an old point-and-shoot
I would like to listen to music, on cheap headphones available anywhere
I would like to make and receive calls using a cheap bluetooth headset
I would like to be able to navigate, using basic maps, like Google Maps
Why pay $1000, or even $500 for that?
Heck, I have a $49 tablet that can do most of that, and add google voice, and now I even have a phone.
Location doesn't have free WiFi? must be a s**thole or something.
I'm not going to "pre-order" anything. I'll let you work out your quality issues, supply issues and buggy crap first. Why don't you pre-ship me a phone, and if I like it, i'll pay for it.
I'm sitting here with a Galaxy S5 on my belt... It would be interesting to learn if the obvious nature of this article has reached the actual decision makers, or if it's still perking up. -- and by the way; If you're out there decision makers, the proper conclusion is that your "new features" are not compelling. Higher res screens that are thinner just don't draw customers. ( if they did, the lifecycle would still be 23 months). Nothing, but nothing, beats actually knowing what your customers what. -- Of course, who am I kidding... the obviously take away they will make is that they should make shotty products that fall apart after 23 months.
___ I don't respond to Anonymous Cowards, and I Never Mod them UP.
I have an iPhone 6 Plus, which will soon be 4 years old. It works fine. (I expect it will work better when I get the update that will stop throttling me.)
I recently cracked the screen, and I see that I can order the parts to do the screen and the battery at once for less than 1/5 the cost of a latest/greatest iPhone. I'll be doing that.
The phone companies' problems are now that they can't push new features that make the phones better in any really meaningful way. They're at the point laptops reached 10 years ago, where unless it actually breaks, you can use it in perpetuity.
They need to innovate if they want people to buy, but they just aren't doing so. And part of it is that we have everything we currently need. My 4 year old phone does everything I need it to do. I'd probably have a little fun with some new features, but I'm not doling out $1000 for negligible benefit. (Not to mention to downgrade to the headphone adapter but that's a different rent).
You want people to spend money? Give them something they want, instead of something they already have.
Apple and Samsung are now eating a big ol' dose of reality.