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This article is part of the On Tech newsletter. Here is a collection past columns.
That was (briefly) the total value of Apple’s shares on Monday. It was worth $2.93 trillion as of Wednesday morning – still an insane number that no company has ever reached before.
The milestone is a useful moment to delve into the identity of Apple and America’s other tech giants. Big Tech companies are smarter at making products and even making money. That’s a big reason why Apple is so valuable.
What is Apple’s superpower? With clever tweaks and desirable new products, it has extended the life of the iPhone empire far beyond the time it might have fallen. What must have been Apple’s weakness – its reliance on the iPhone at a time when smartphones were no longer selling like hot cakes – became a powerhouse instead.
It’s like knowing there’s Google and Facebook is rich from selling ads for socks and hotel staysUnderstanding the nuts and bolts behind Apple’s power helps unravel the mystery of the tech giants that have captured both our surprise and ridicule.
In the spirit of Tuesday’s tech newsletter wrong assessmentsI will admit that I was wrong about Apple. I wrote 6 years ago colon According to Bloomberg Opinion — the first of many like this — Apple said it hit a wall.
Since then, Apple’s sales have increased by more than $132 billion, or nearly three times what Tesla has done since 2015. Apple’s profits are not real and we are probably paying too much for it. $19 cleaning cloths.
I still think I’m right about Apple, but I’m not right yet. (You can define this as wrong. I will not argue.) The facts remain: The company’s main product, smartphones, went from wow to normaland people aren’t buying new ones as often as they used to.
About 1.4 billion new smartphones were sold worldwide in 2015. In 2021, research firm IDC expects total sales to be… about 1.4 billion. Some of the iPhones – about one in seven – haven’t changed much. There are exceptions to this flat selling trend, including a large number of new iPhones being sold last year.
But for the most part, smartphones are like that right now: a great and essential item like refrigerators, cars, and TV sets that people don’t buy very often. Theoretically, it should be bad for Apple if we buy fewer phones. Instead, Apple has done a great job because it’s extremely smart about monetization and has convinced customers to buy what they’re selling.
Apple has found ways to sell many more types of iPhones than before, including ultra-expensive ones. He has mastered the invaluable details such as self-designed computer chips and Encourages iPhone buyers to pay more for add-ons like extra space to store photos. The company continues to find new ways to monetize things that make iPhones more useful, like subscriptions for dating apps, AirPods headphones, and computer watches.
This isn’t Apple’s move away from the iPhone company identity. It leans more towards iPhone addiction. I would like to say that It will be difficult for Apple to keep doing this., but smartphone sales have been meh for six years and Apple has been doing great.
None of this fully explains Apple’s march to $3 trillion. To be honest, money just doesn’t make sense right now. And Big Tech companies typically generate consistently and steadily increasing profits that stock buyers get. willing to pay.
There is also enthusiasm about Apple launching its first products. face computers and driverless cars this could enable other companies to follow their lead, as the iPhone did, and make Apple even richer.
Apple’s fight with smart software — have you yelled at Siri lately for being ignorant? – suggest that there will be no cake walk for the company to keep winning metadata store and the future of artificial intelligence. However, this is not a guess. I’m done with making Apple predictions.
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