Walt Laws-MacDonald | Show Me The Money!
AAPLs and oranges
Published: Thursday, September 27, 2012
Updated: Thursday, September 27, 2012 02:09
OH MY GOD IT’S FINALLY HERE IPHONE 5 OH MY GOD.
Get it out of your system. Take a lap. It’s just a phone. Or is it?
Yes, it is just a phone. But that’s not what everyone is so excited about. It’s the economic event that surrounds every one of Apple’s product launches.
So there’s a new iPhone. It has the usual laundry list of new features: bigger screen, better camera, iOS 6, etc., etc. But as rival handheld maker Samsung has quickly pointed out, most of the features on the new iPhone have been a part of Android phones for several months. The Samsung Galaxy S III, released in May of 2012, has a larger screen, more memory and a bigger battery. But it’s not an iPhone.
Apple’s mobile dominance is a product of its own success. When comparing an iPhone to any other phone — or any Apple product to its non-Apple competitor — the biggest victory for Apple is simply being Apple. Apple brings a consistency across its platforms that the open-source format of the Android operating system inherently cannot provide. Apple products look cool. Yes, maybe it is just a black rectangle, but it’s the sleekest black rectangle you have ever seen.
In Apple’s own words — seriously, check the website — the iPhone 5 is “The biggest thing to happen to iPhone since iPhone.” Really Apple? Other gems include “So much more than before. And so much less, too.” and “It’s not just bigger. It’s just right.” Sure, maybe they could be a bit more descriptive, but the vagueness adds an air of mystery to the phone.
Apple barely advertises its products. When Apple’s Vice President of Marketing Phillip Schiller testified in the Samsung patent case, he said that Apple “didn’t need to” advertise after the release of many of its products. The media hypes up its product launches so much that Apple cannot do much more to spread the word. When combined with Apple’s TV and movie presence — ever notice that MacBook on Jimmy Fallon’s desk? — traditional advertisements seem unnecessary.
Preorders of the phone have already topped those from last year’s iPhone 4S, with some analysts estimating that Apple could conservatively sell between 10 and 12 million iPhones from October to December this year.
Though Apple products have always had huge launches, Apple’s ability to consistently outdo itself in this regard is unique. With the mobile space converging to the iOS and Android platforms, Apple has consistently proven itself the winner. Though Android controls the majority of the mobile market, Apple’s one device has crushed those of the plethora of Android manufacturers.
Perhaps the craziest stat I can drop today is that the release of the iPhone 5 is estimated to raise the United States’ fourth -quarter GDP growth by 0.5 percent. That means that iPhone sales could account for a quarter of our country’s entire economic growth for the end of this year. Forget manufacturing, construction, services — the iPhone could be a quarter of our economy’s growth. And it’s just a phone.
So when comparing the iPhone to its competitors, it really is like comparing Apple to oranges. They might perform the same tasks and come with similar technical specifications, but each phone represents far more than a means of communication. iPhones are still status symbols — less so than when the original was released, but status symbols nonetheless. I’ve never seen a line around the block for an Android phone, and I don’t expect to see one anytime soon. The Cult of Apple is alive and well, and the end is not near.
Walt Laws-MacDonald is a sophomore majoring in quantitative economics. He can be reached at Walt.Laws_MacDonald@tufts.edu.