Jason Snell wrote on SixColors:

Without good hardware and software, Apple’s services would be irrelevant. I hope everyone in a position of authority at Apple understands that. Services are a way to help make Apple’s hardware even more profitable than it already was. But services can never, ever take precedence over Apple’s hardware. If Apple ever begins to see its hardware as merely a vessel for selling more subscription services, the game will be over.

https://sixcolors.com/post/2024/08/existential-thoughts-about-apples-reliance-on-services-revenue/

Existential thoughts about Apple’s reliance on Services revenue

Apple Pay and Apple Card are among Apple’s growing services. Apple’s latest quarterly results were about as boring as you can get while still featuring $21.4 billion in profit and setti…

sixcolors.com

I suspect this line has already been crossed. #Apple has gone through these phases:

1. We sell hardware
2. We sell hardware and software
3. We give away software to sell hardware
4. We sell hardware and charge other people to sell software
5. We sell services to enhance our hardware
6. We sell services through our hardware

We are now between phases 5 and 6. The sheer profitability of Services will inevitably lead to a de-emphasis of (non-iPhone) hardware sales. I predict Services will very soon exceed iPhone in terms of profits because of its incredible margins.

• #apple
• #opinion