Tripp Mickle, Wall Street Journal:
Apple Inc. is preparing to supersize its iPhone lineup, aiming to drive profit in its biggest business despite stagnant unit sales while also fueling growth for apps and services that are more appealing to users with bigger screens.
At a time when people are buying fewer new phones, bigger size brings two advantages. It helps Apple buoy prices and profit margins because it can sell larger phones at a greater markup than it pays suppliers for the larger screens. And it encourages people to use their phones more, helping momentum of Apple’s services business, which includes app-store sales and subscriptions to video services like Netflix and HBO.
Users with smartphone screens 6 inches or larger, like Apple plans to launch this year, typically use twice as many apps as those with 5.5-inch screens, such as those on the largest versions of the iPhone 6 or 7, said Kantar Worldpanel, a market research firm. Users of the larger devices also are 62% more likely to play games, and twice as likely to watch video daily as people with smaller screens.
Interesting article. Apple is getting smarter and smarter at fine-tuning devices to align with and drive revenue growth. This is all, in part, a strategy aligned with Apple’s coming entry into the Netflix-dominated video market.
There are spoilers in the article about tomorrow’s Apple event, so jump in if you are interested, avoid if you don’t even want a whiff of what’s coming.