[sneak]

With a soon to be nonexistent middle class in the USA (as well as big growth in comparatively poor countries) getting Apple-style huge profits in the next 2-3 decades is going to be much more about getting $20-50/mo/user in perpetuity and less about selling premium price $1k-3k devices. The AVP (at like version 3 or 4) is the endgame for “Apple should make a TV”. It’s the ultimate passive content consumption device.

Apple is now existentially committed to recurring revenue like a crackhead loves crack.

It was obvious to me when I bought a $1600 iPhone and within 5 minutes of setting it up it began nagging me for $5 for iCloud storage. When even Google has figured out how to not nickel and dime your most profitable customer segment and Apple hasn’t, you know something’s wrong.

Expect one of the most clever companies in the world to put a majority of their mental energy into rentseeking of all kinds, from cloud storage to content rentals (music and tv and movie subscriptions) to AppleCare and every other possible thing (Fitness, Arcade, the perpetual iPhone upgrade thing, etc). It’s going to be subscriptions forever.

I expect them to be wildly successful from a revenue standpoint with this plan. Their products (that ugly-ass Ultra watch and tiny bass-free Homepod mini, for example) and nag-filled no-privacy UX have taken a hit and will continue to do so. They’re just consumption devices for Apple Music and iMessage (your attachment history for which drives iCloud storage upgrades). I’m surprised they haven’t figured out a way to charge something for FaceTime yet.

This is why they are fighting the DMA - their position as rentseeker is directly responsible for a double digit percentage of the profits of the most valuable company in the world for the next two dozen years. We are talking about literally trillions of dollars hanging in the balance here. How much fight do you think they will bring to bear on this for that much revenue?

There is zero product UX that is insanely great coming out of Apple these days. The actual engineering behind things like Homepods, AVP, the watch, AirPods, and the Mx silicon is absolutely insane, but it doesn’t inspire users in the UX anymore - it’s all in the background. The AVP is literally the cutting edge of hardware at that price point and all people say about it is that it’s too heavy. The products can’t exist without the engineering, but the users don’t know or care and don’t get the elation and delight that Apple used to be explicitly known for. It’s just “GPU performance and battery life go up and to the right again this year (and sometimes new colors)”.

It’s all just scaffolding to play back consumer media (the marginal cost of which asymptotically approaches zero) so they can extract the recurring rents.

I wouldn’t be surprised if they ever do make a car that they offer it as lease-only.

[amadeuspagel]

Any organization is committed to recurring revenue because it has recurring costs, most importantly salaries.

[sneak]

Sure, but historically Apple made that recurring revenue by simply selling expensive hardware devices at intervals, one sale at a time. The growth period of those is now over. There aren’t ever going to be 5x as many smartphone or tablet or laptop users in the future as there are today. To support continued y/y increases they need to increase revenue somewhere and it’s not going to be from new product categories, at least for a few years, such as when the AV(non-P) is much lighter and an order of magnitude cheaper.

The problem is that they can’t simply continue to earn four hundred billion a year - that’s not enough. Each year it must increase. No revenue figure is ever sufficient.

Apple’s eras are:

- the growth of the pre-graphical personal computer market

- the growth of the graphical computer market (Mac) (worth noting that they mostly failed to capture this)

- the growth of the portable/internet graphical computer market (ie affordable personal laptops)

- the growth of the smartphone market

- rentseeking (and maybe the growth of the VR hardware market if they and Zucc have guessed correctly)

There isn’t another growing hardware market for them to surf at this point. They’re doing their best with smart speakers, earbuds, headphones, watches, and tablets but in the grand scheme of revenue nobody really cares about those and they won’t grow substantially in the future.