Month: January 2019

Behind Apple’s disconcerting news of weak iPhone sales lies a more sobering truth: The tech industry has hit Peak Smartphone, a tipping point when everyone who can afford one already owns one and no breakthroughs are compelling them to upgrade as frequently as they once did.

Some manufacturers have boosted prices to keep up profit, but Apple’s shortfall highlights the limits of that strategy. The company said demand for iPhones is waning and revenue for the last quarter of 2018 will fall well below projections, a decrease traced mainly to China.

Apple’s shares dropped 10 percent Thursday on the news — its worst loss since 2013. The company shed $74.6 billion in market value, amid a broader sell-off among technology companies, which suffered their worst loss in seven years.

Apple’s news is a “wake-up call for the industry,” said analyst Dan Ives of research firm Wedbush Securities.

And it’s not just Apple. Demand has been lackluster across the board, Ives said. Samsung, long the leading seller of smartphones, has been hit even harder, as its phone shipments dropped 8 percent during the 12 months ending in September.

“The smartphone industry is going through significant headwinds,” Ives said. “Smartphone makers used to be like teenagers, and the industry was on fire. Now it feels like they’re more like senior citizens in terms of maturity.”

Victim of its own success

Tech innovations in phones grew in leaps and bounds earlier in the 2010s, with dramatic improvements in screen size, screen resolution, battery life, cameras and processor speed every year.

But the industry is a victim of its own success. Innovation began to slow down around 2014, once Apple boosted the screen size with the iPhone 6 and 6 Plus models. While phones kept improving, new features tended to be incremental, such as a new flash technique to already excellent phone cameras. It’s the stuff consumers won’t typically notice — or want to shell out for.

“Since the iPhone 6 you’ve seen it has been tough to innovate to continue to raise the bar,” Ives said.

Apple customers now upgrade every 33 months on average, longer than the 24 or 25 months three years ago, he said.

Apple’s diminished growth projections, fueled by plummeting sales in China, have reinforced fears the world’s second-largest economy is losing steam. Its $1,000 iPhone is a tough sell to Chinese consumers unnerved by an economic slump and the trade war with the U.S. They also have a slew of cheaper smartphones from homegrown competitors such as Huawei, Xiaomi and Oppo to choose from.

The fact that even Apple’s iPhone juggernaut is suffering cements a larger trend for all major smartphone makers. After a steady rise for a decade, worldwide smartphone shipments fell 3 percent to 1.42 billion in 2018, the first annual drop, according to International Data Corp., which tracks such movements. IDC estimates that shipments will rebound 3 percent in 2019 to 1.46 billion, but that still falls short of 2017 levels.

No ‘silver bullet’

It doesn’t help that top phones come with four-digit price tags — $1,100 for the iPhone XS Max and $1,000 for Samsung’s Galaxy Note 9. The top-end Max model sells for $1,450 in the U.S.

“They’re getting more and more expensive while offering fewer and fewer new, innovative features that I’ll actually use,” said Zachary Pardes, a tech-savvy 31-year-old in Fairfield, Connecticut. “I’ll upgrade when the battery stops working. When I’m forced to buy a new phone, I’ll buy a new phone.”

Vivian Yang, a manager at a Beijing technology company, also balked at the price. “Nobody needs such a phone,” she said.

IDC analyst Ramon Llamas said the cycle might bottom out and start growing again in 2021 or 2022, when people’s current phones start reaching the end of their useful life. “People will still replace their phones. It’s going to happen eventually,” he said.

But there’s no “silver bullet” that will spur growth to levels seen in the past when the industry was less mature.

Foldable smartphones, with screens that unfold like a wallet to increase display size, are one thing that could spur excitement, but they’re expensive and not due out until at least the end of the year.

Another thing that might spur growth: 5G, the next-generation that telecom companies are currently in the process of building, expected to be faster and more reliable than the current 4G network. The first 5G compatible phones are due out this year.

“There’s more pressure on 5G as the next-wave smartphone,” since sales are so lackluster, said Ives. “There will be a battle royale for 5G phones.”

But 5G will take years for broad, nationwide deployment, so the new 5G smartphones coming out this year are not likely to make much of a splash immediately either.

Analysts say smartphone makers need to push into under-saturated areas like Africa and elsewhere, and also sell more services like cloud storage, streaming music and phone software. But the glory days of untrammeled growth appear to be over.

“It’s going to be a slow slog,” Llamas said. “By no means is this the end of the smartphone market. But this is an indication that the smartphone market can be a victim of its own success.”
…

Behind Apple’s disconcerting news of weak iPhone sales lies a more sobering truth: The tech industry has hit Peak Smartphone, a tipping point when everyone who can afford one already owns one and no breakthroughs are compelling them to upgrade as frequently as they once did.

Some manufacturers have boosted prices to keep up profit, but Apple’s shortfall highlights the limits of that strategy. The company said demand for iPhones is waning and revenue for the last quarter of 2018 will fall well below projections, a decrease traced mainly to China.

Apple’s shares dropped 10 percent Thursday on the news — its worst loss since 2013. The company shed $74.6 billion in market value, amid a broader sell-off among technology companies, which suffered their worst loss in seven years.

Apple’s news is a “wake-up call for the industry,” said analyst Dan Ives of research firm Wedbush Securities.

And it’s not just Apple. Demand has been lackluster across the board, Ives said. Samsung, long the leading seller of smartphones, has been hit even harder, as its phone shipments dropped 8 percent during the 12 months ending in September.

“The smartphone industry is going through significant headwinds,” Ives said. “Smartphone makers used to be like teenagers, and the industry was on fire. Now it feels like they’re more like senior citizens in terms of maturity.”

Victim of its own success

Tech innovations in phones grew in leaps and bounds earlier in the 2010s, with dramatic improvements in screen size, screen resolution, battery life, cameras and processor speed every year.

But the industry is a victim of its own success. Innovation began to slow down around 2014, once Apple boosted the screen size with the iPhone 6 and 6 Plus models. While phones kept improving, new features tended to be incremental, such as a new flash technique to already excellent phone cameras. It’s the stuff consumers won’t typically notice — or want to shell out for.

“Since the iPhone 6 you’ve seen it has been tough to innovate to continue to raise the bar,” Ives said.

Apple customers now upgrade every 33 months on average, longer than the 24 or 25 months three years ago, he said.

Apple’s diminished growth projections, fueled by plummeting sales in China, have reinforced fears the world’s second-largest economy is losing steam. Its $1,000 iPhone is a tough sell to Chinese consumers unnerved by an economic slump and the trade war with the U.S. They also have a slew of cheaper smartphones from homegrown competitors such as Huawei, Xiaomi and Oppo to choose from.

The fact that even Apple’s iPhone juggernaut is suffering cements a larger trend for all major smartphone makers. After a steady rise for a decade, worldwide smartphone shipments fell 3 percent to 1.42 billion in 2018, the first annual drop, according to International Data Corp., which tracks such movements. IDC estimates that shipments will rebound 3 percent in 2019 to 1.46 billion, but that still falls short of 2017 levels.

No ‘silver bullet’

It doesn’t help that top phones come with four-digit price tags — $1,100 for the iPhone XS Max and $1,000 for Samsung’s Galaxy Note 9. The top-end Max model sells for $1,450 in the U.S.

“They’re getting more and more expensive while offering fewer and fewer new, innovative features that I’ll actually use,” said Zachary Pardes, a tech-savvy 31-year-old in Fairfield, Connecticut. “I’ll upgrade when the battery stops working. When I’m forced to buy a new phone, I’ll buy a new phone.”

Vivian Yang, a manager at a Beijing technology company, also balked at the price. “Nobody needs such a phone,” she said.

IDC analyst Ramon Llamas said the cycle might bottom out and start growing again in 2021 or 2022, when people’s current phones start reaching the end of their useful life. “People will still replace their phones. It’s going to happen eventually,” he said.

But there’s no “silver bullet” that will spur growth to levels seen in the past when the industry was less mature.

Foldable smartphones, with screens that unfold like a wallet to increase display size, are one thing that could spur excitement, but they’re expensive and not due out until at least the end of the year.

Another thing that might spur growth: 5G, the next-generation that telecom companies are currently in the process of building, expected to be faster and more reliable than the current 4G network. The first 5G compatible phones are due out this year.

“There’s more pressure on 5G as the next-wave smartphone,” since sales are so lackluster, said Ives. “There will be a battle royale for 5G phones.”

But 5G will take years for broad, nationwide deployment, so the new 5G smartphones coming out this year are not likely to make much of a splash immediately either.

Analysts say smartphone makers need to push into under-saturated areas like Africa and elsewhere, and also sell more services like cloud storage, streaming music and phone software. But the glory days of untrammeled growth appear to be over.

“It’s going to be a slow slog,” Llamas said. “By no means is this the end of the smartphone market. But this is an indication that the smartphone market can be a victim of its own success.”
…

Forget vending machines, PepsiCo is testing a way to bring snacks directly to college students.

The chip and beverage maker says it will start making deliveries with self-driving robots on Thursday at the University of the Pacific in Stockton, California. Students will be able to order Baked Lay’s, SunChips or Bubly sparkling water on an app, and then meet the six-wheeled robot at more than 50 locations on campus.

Other companies have been using self-driving vehicles to deliver food. Last month, supermarket operator Kroger announced it would start delivering groceries in a driverless vehicle from a store in Scottsdale, Arizona.

The robots used at the University of the Pacific will move at speeds of up to 6 miles per hour, according to Robby Technologies, which makes the robots. Three workers on the campus will be refilling the robots with food and drinks and replacing the batteries with recharged ones when they go dead.

At first three robots will be used, but then grow to a fleet of five over time. The robots, which weigh 80 pounds and are less than 3 feet tall, drive on their own and stop when someone is in front of it, Robby says.

PepsiCo says it’s testing this way to deliver its snacks because more of its customers want a convenient way to buy them on their phones.
…

Forget vending machines, PepsiCo is testing a way to bring snacks directly to college students.

The chip and beverage maker says it will start making deliveries with self-driving robots on Thursday at the University of the Pacific in Stockton, California. Students will be able to order Baked Lay’s, SunChips or Bubly sparkling water on an app, and then meet the six-wheeled robot at more than 50 locations on campus.

Other companies have been using self-driving vehicles to deliver food. Last month, supermarket operator Kroger announced it would start delivering groceries in a driverless vehicle from a store in Scottsdale, Arizona.

The robots used at the University of the Pacific will move at speeds of up to 6 miles per hour, according to Robby Technologies, which makes the robots. Three workers on the campus will be refilling the robots with food and drinks and replacing the batteries with recharged ones when they go dead.

At first three robots will be used, but then grow to a fleet of five over time. The robots, which weigh 80 pounds and are less than 3 feet tall, drive on their own and stop when someone is in front of it, Robby says.

PepsiCo says it’s testing this way to deliver its snacks because more of its customers want a convenient way to buy them on their phones.
…

A Chinese spacecraft Thursday made the first-ever landing on the far side of the moon in the latest achievement for the country’s growing space program.

The relatively unexplored far side of the moon faces away from Earth and is also known as the dark side.

A photo taken by the lunar explorer Chang’e 4 at 11:40 a.m. and published online by the official Xinhua News Agency shows a small crater and a barren surface that appears to be illuminated by a light from the probe.

Chang’e 4 touched down on the surface at 10:26 a.m., the China National Space Administration said. The landing was announced by state broadcaster China Central Television at the top of its noon news broadcast.

Growing ambitions in space

The landing highlights China’s growing ambitions as a space power. In 2013, Chang’e 3, the predecessor craft to the current mission, made the first moon landing since the then-Soviet Union’s Luna 24 in 1976. The United States is the only other country that has carried out moon landings.

The work of Chang’e 4, which is carrying a rover, includes carrying out astronomical observations and probing the structure and mineral composition of the terrain.

“The far side of the moon is a rare quiet place that is free from interference of radio signals from Earth,” mission spokesman Yu Guobin said, according to Xinhua. “This probe can fill the gap of low-frequency observation in radio astronomy and will provide important information for studying the origin of stars and nebula evolution.”

Communicating

One challenge of operating on the far side of the moon is communicating with Earth. China launched a relay satellite in May so that Chang’e 4 can send back information.

China plans to send its Chang’e 5 probe to the moon next year and have it return to Earth with samples, the first time that will have been done since the Soviet mission in 1976.

A Long March 3B rocket carrying Chang’e 4 blasted off Dec. 8 from Xichang Satellite Launch Center in southern China. Chang’e is the name of a Chinese goddess who, according to legend, has lived on the moon for millennia.
…

A Chinese spacecraft Thursday made the first-ever landing on the far side of the moon in the latest achievement for the country’s growing space program.

The relatively unexplored far side of the moon faces away from Earth and is also known as the dark side.

A photo taken by the lunar explorer Chang’e 4 at 11:40 a.m. and published online by the official Xinhua News Agency shows a small crater and a barren surface that appears to be illuminated by a light from the probe.

Chang’e 4 touched down on the surface at 10:26 a.m., the China National Space Administration said. The landing was announced by state broadcaster China Central Television at the top of its noon news broadcast.

Growing ambitions in space

The landing highlights China’s growing ambitions as a space power. In 2013, Chang’e 3, the predecessor craft to the current mission, made the first moon landing since the then-Soviet Union’s Luna 24 in 1976. The United States is the only other country that has carried out moon landings.

The work of Chang’e 4, which is carrying a rover, includes carrying out astronomical observations and probing the structure and mineral composition of the terrain.

“The far side of the moon is a rare quiet place that is free from interference of radio signals from Earth,” mission spokesman Yu Guobin said, according to Xinhua. “This probe can fill the gap of low-frequency observation in radio astronomy and will provide important information for studying the origin of stars and nebula evolution.”

Communicating

One challenge of operating on the far side of the moon is communicating with Earth. China launched a relay satellite in May so that Chang’e 4 can send back information.

China plans to send its Chang’e 5 probe to the moon next year and have it return to Earth with samples, the first time that will have been done since the Soviet mission in 1976.

A Long March 3B rocket carrying Chang’e 4 blasted off Dec. 8 from Xichang Satellite Launch Center in southern China. Chang’e is the name of a Chinese goddess who, according to legend, has lived on the moon for millennia.
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This year marks the 50th anniversary of mankind’s first steps on the moon, so it is fitting that there are a number of exciting projects pushing us back into space. VOA’s Kevin Enochs reports on some of 2019’s biggest stories in space.
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