Apple might not realize it, but it’s in the midst of a public relations nightmare. Not just public as in the buyers of your stuff, either. I’m talking about all the world. Developers of applications sold on their platform. Analysts who watch your every move. Journalists covering their steps and missteps. And yes, people lining up to buy an iPhone at the Apple Store.
It’s been a strange time to watch Apple in recent weeks. We had those new iPhones launch in September, along with the new Apple Watches. They certainly raised a ton of money and times were good. But there was bad news: some products became more expensive without getting new features. So Apple followed that by announcing a price increase in some of its services.
Then things got worse. As if trying to chip away at five cents to make another billion dollars in profit, Apple placed new ads on its app store. And all hell broke loose.
ads for everyone
What is this? Gambling ads at the bottom of a listing on a gambling addiction recovery app. How can this possibly go wrong? #Apple #appstore pic.twitter.com/9MQQvDMx8rOctober 26, 2022
Apple putting ads on the App Store isn’t new, but it expanded them in a way that surprised many, apparently including the company itself. By putting ads on app pages, Apple found itself in the middle of a storm. dating app ads appeared alongside marriage counseling apps. Gambling ads appeared on app pages designed to help people kick the habit. It was as if Apple had opened the floodgates, seemingly unaware of the possible repercussions of allowing ads to appear alongside anything, as long as the offer was high enough.
Apple subsequently pulled the plug, at least in some ads. Apple said it was pausing “gaming-related ads and some other categories on App Store product pages.” And that was it.
There are some unpacking issues there, starting with the fact that Apple didn’t see this coming, or worse, didn’t think it mattered. But the real issue is why Apple found itself pushing gambling addicts to addicts in the first place. And it’s the same reason apple music Now it costs more and buying the same ipad-mini today it will cost more than a few weeks ago. It’s about growth.
growth at all costs
Apple, like most companies, is publicly owned. It has shareholders. And while you might think that Apple CEO Tim Cook doesn’t have a boss, you’d be wrong.
The shareholders are their bosses. Each. Unique. A. And they, like Wall Street, demand growth.
It doesn’t matter how well Apple did last quarter or last year. It’s have to do better this year, or has failed. Damned, as the Internet might say. It doesn’t matter if Apple matches the previous year’s numbers to the penny. If he didn’t sell an extra $19 cleaning cloth, Tim Cook isn’t doing his job.
There was a time when Apple could rely on the iPhone to carry the load, of course. Each new iPhone outsold the last, and while estimates suggest that the iPhone 14 Pro and the iPhone 14 Pro Max are selling well, the same cannot be said for the iPhone 14 and iPhone 14 Plus. A global economic situation that is on life support isn’t helping either. But you know what does it keep growing?
Services. Services like apple music, Apple TV Plus, apple arcadeand… ads.
recent from apple quarterly results (opens in a new tab) it has services accounting for $78 billion by 2022 through September 24. That’s up from $68 billion at the same point in 2021. For the quarter, it grew $1 billion. The previous quarter also experienced growth, although at a decreasing rate compared to some previous ones.
Which brings us to how Apple can increase its revenue. It only releases a new line of iPhones once a year. Same for iPad and Apple Watch lineups. Macs come and go, but each model is updated once a year at best. Mac Pro owners get a new model every time the company gets down to it. In terms of predictable recurring revenue, Apple’s focus appears to be on services. That’s why supposedly spent $2.5 billion to get the broadcast rights to Major League Soccer. And it is said that he is in the driver’s seat for a similar deal with the NFLalso.
hardware discrepancy
So the services are where the money is, good. But we also need to address why Apple’s iPad and iPhone are more expensive than they were a couple of months ago.
We all know that the world is in the midst of a difficult time in terms of finances. Markets are all over the place, currencies are falling in the blink of an eye, and above all, the US dollar is strong. And that is the crux of the matter.
Every time Apple sells an iPhone or iPad in the UK, for example, it has to convert sterling back into dollars. When the dollar is worth so much against the pound, you get less money from each device that is sold. The same goes for other countries and currencies as well.
So what does Apple do? Increase the price of international products to compensate. Makes sense, right? Except there’s one problem: it sucks. And people look at Apple’s balance sheet and Scrooge McDuck’s mountains of money and think “hey, maybe Apple could eat some of that cost.”
And of course it could. But also can not.
By the shareholders. and growth. And the real job of the CEO: to make as much money as possible for those shareholders. Effectively, gifting money to international clients is the opposite of that, so it can’t happen. Even if Tim Cook wanted to, and I don’t think for a minute that he would, he couldn’t. His hands are tied. And the situation is the same with everything that is wrong with Apple right now, including those ads.
sleeping chickens everywhere
now we know why Apple has increased the price of its services, and why your next iPad will cost more than your last one even if it hasn’t changed a bit. But what is the real cost of all that?
Reputational damage.
We know that Apple likes to think that it is above other companies in many ways. It does so with its environmental initiatives that, while doing good, still manage to be a public relations exercise. It does so with the way it tries to tell us how happy everyone is with their new hardware: “customer satisfaction is off the charts,” as Cook would say. Apple’s reputation matters. And he’s trading it for a few million here, a billion or two there. And it sucks.
Putting ads on the App Store was one thing. Putting them on individual app pages is another. Not thinking about, or worrying about, the ramifications of those ads is another thing, too. But the big problem? The real problem that could cause Apple to start to slide, maybe even so slowly that you don’t notice?
It is losing our trust. And no amount of money can recover that. To earn trust, Apple has to do the right thing for customers. Whether it’s the right thing for shareholders, or not.
and shareholders forever victory.
It may be an extreme example, but we need look no further than the clutter on Meta and Twitter to see how bad things can get when the mantra is “growth at all costs.” target only fired thousands of peopleand Twitter did the same thing after the Elon Musk purchase and did it so randomly that I had to ask some to come back.
Apple might be in a much better state than Meta or Twitter, but the point is firm: growth at all costs can be quite costly at times.