[twootten]

Linkbait aside, if Apple's gross margin is decreasing, which it looks like it is, its most likely because of the iPad which carries a lower profit margin. So when iPad sales become a larger portion of total sales, gross margin goes down while total profits still go up.

[Tloewald]

Big if.

Apple has made a generic margin warning in its q4 press release, but did not make a thing of it as in past instances. Q4 was down to 40% from 40.3% a year ago. Do you think Apple plans to break with years of tradition and start pumping its forecasts?

The two questions are whether the iPad mini is actually a low margin product — but if Google can sell the Nexus 7 at break even for $200 this seems pretty doubtful to me (the iPad screen and camera notwithstanding) - and whether Samsung's processor price hike will have a meaningful impact.

[steverb]

I think that the rise of Android is enabling carriers to push back a lot harder on the subsidies too. From their point of view, there's good demand across the board for Android phones and they can sell them with better profit, which would probably make them more inclined to negotiate harder with Apple.

I wouldn't be surprised if one of the carriers threatens to skip the next iPhone release.

[Tloewald]

The carriers make way more money off iPhone customers so not likely. Also, in general, no-one switches carriers to get random android devices. They will leave carriers to get iPhones.

As android increases share of the phone market (vs. smartphone market, right?) the percentage of mobile web traffic from android has, if anything, dropped. This suggests android is winning big in the "I don't care what phone I get" market. This isn't the fat juicy part of the market.

[steverb]

They USED to make way more money. I don't know that that is still true, based on gripes from sales people about commissions I'm pretty sure it's no longer true. I do know that carriers are pushing Android (and even Windows) phones a lot harder than they were a year ago.

[Tloewald]

Sales people's commissions tend to be inversely related to customer demand. iPhone demand outstrips supply to incentivizing salespeople to sell iPhones makes no sense.

Think the numbers have dramatically changed since August? http://www.forbes.com/sites/ycharts/2012/08/10/can-anyone-he...

[steverb]

As far as I can tell, those charts don't break down the usage between iPhone and others. Doesn't matter though as your first point trumps it.

But good point about the reverse commissions arrow. I'll have to go check what current commissions are on the iPhones vs previously.

[Tloewald]

Agreed about the figures as they can only be inferred. asymco has done some analyses along these lines in the past but I couldn't find one in a hurry (and it might not have been recent). Other indirect measures do not show android is doing better as a "smart" phone (I.e. generator of demand for expensive cellular plans).