The iPhone X rests on the Shoulders of the iPhones that came Before It

With a rumor mill that feels like it started the day after the iPhone 7 launched, we finally know everything there is to know about the new iPhone line up. Three products: the iPhone 8, iPhone 8 Plus and iPhone X – pronounced ten.

Before we got to the most anticipated product of the year, however, Tim Cook spent time talking about the biggest product we saw for the first time: Apple Park. The homage to Steve Jobs was short, intense and from the heart. It also felt as if Tim Cook was turning a page into a new chapter. Acknowledging that today’s and, more importantly, tomorrow’s Apple remains true to what Jobs believed Apple should be but it is now a company standing on its own feet.

The iPhone X

There have been months of looking back at the past ten years of iPhone in a somewhat nostalgic way. It is when looking at the last ten years of technology, however, that you see how the iPhone X rests on the shoulders of the iPhones that came before. Touch, use of glass and metal, camera technology, retina display, Touch ID all contributed to getting to the iPhone X that was just introduced. Most importantly, the iPhone X would likely not exist without the steps Apple took in its chipset designs reaching a vertical integration that truly sets its products apart. Going forward, this focus on chips will prove key to Machine Learning and Artificial Intelligence two technologies that were mentioned a lot during the keynote.

The two key features that will drive iPhone X interest are FaceID and the new Super Retina Display. While users will have to learn new gestures to navigate the new bezeless screen, the learning curve does not seem steep. The screen is beautiful and drives instant gratification while the real benefit of FaceID will come with use. As always with Apple, it is not about a feature performing one task, it is about leveraging that feature in different ways. So FaceID unlocks your iPhone X, but the technology behind it also opens your notifications or turns off your alarm if the iPhone “sees” you looking at the screen. And of course, face recognition is also empowering the new Animojis, which will push messaging to an all new level! All these experiences point to Apple creating an even tighter connection between me, the user, and my iPhone, one where thanks to ML and AI things will happen just like magic.

iPhone X will ship on November 3 and the market expressed concern about this delay compared to the iPhone 8 and 8Plus shipping date. However, there is one thing in my mind that people are neglecting to consider. In all the key markets where iPhone X will matter, Apple has a strong retail presence which will allow Apple to be ready for the holidays shopping. Unlike most of its competitors, Apple does not entirely depend on shelf space allocated earlier in the Fall at the key retailers. Online and Apple Town Squares are a big part of Apple’s sales, and when it comes to iPhone X those channels would have likely been responsible for most of those sales anyway.

I am also not concerned about potential iPhone X buyers opting for an iPhone 8 rather than waiting. Of course, either way works for Apple. Pricing was smart here. The way that the iPhone 8 Plus, in particular, is priced almost makes the decision to go for iPhone X easier: an iPhone 8 Plus with 256GB is $949. Some users might compromise on storage if they have an iCloud account and are used to store everything there.

Overall the price of the new iPhone X is a non-issue in all those markets that have installment plans available. Consumers will see an increase in the low double digits on what they currently pay monthly.

The Strongest Lineup Yet

If you are still concerned about the price point of the iPhone X, the good news is that it is not the only option Apple has given potential buyers. Apple’s iPhone line up has a little bit for everybody from the iPhone SE at a very competitive $349 all the way to the new iPhone X via the iPhone 6s and 6sPlus, and iPhone 7 and 7Plus which are now $100 cheaper and iPhone 8 and 8 Plus.

The key here is that with the choice in price there is no choice to be made in experience. While it is true that some features are hardware dependent, the vast majority of what the Apple ecosystem has to offer covers all these devices in some way. Take AR for instance, while the iPhone X will be able to make use of the new depth sensing camera for AR, owners of all the iPhones mentioned above can experience AR through iOS11.

Some people are concerned that Apple created a new hero product that moves further away from the mainstream iPhone. Yet this is no different than what Apple has done with the iPad family and with the Mac family. Even more so with iPhone, Apple realizes that not all iPhone users want more technology and especially when it comes to some technology, not every user is ready for it. Yet, this should not stop Apple from continuing to innovate.

A few more things…

 Watch Series 3

  • I am a self-declared non-believer when it comes to cellular in a smartwatch. The main reason is that I would never leave my phone behind when I leave my home. The second reason is that adding LTE has meant a compromise in size of the device and battery life. Today, Apple took reason number two away!
  • Apple also helped my decision by pricing the LTE Watch very aggressively. For $70 difference, I might just try and see if my umbilical cord to my iPhone can not just be extended, as it happens today with Watch Series 2, but can be cut. While I still do not see myself intentionally leaving my iPhone behind, I am quite happy to pay for the peace of mind in case I do unintentionally forget it.
  • Probably the biggest driver for me for connectivity is the ability to interact with Siri through voice alone. Thanks to LTE, in fact, Siri can now reply to you rather than showing you an answer on the screen
  • I found the video Apple used in the keynote showing a very wide range of people of all ages, genders, and nationalities to really drive home the point that Apple Watch delivers a different value to different people and you need to find what motivates you. I said this from the very beginning: Apple Watch will give back more if you initially invest time in figuring out what it can do for you.

AppleTV 4K

  • Live Sports coming to Apple TV at the end of the year is a great addition to the segment that spends the most money on TV content
  • Interesting mention of Music on AppleTV which raised my curiosity on whether anything will be special about HomePod being able to pair with Apple TV.
  • An underestimated value of AppleTV is the role it plays as a hub for HomeKit. As consumers connect more and more devices in the home the value for this feature alone will deliver a good return on investment
  • The fact that AppleTV 4K will update your purchased non-4K content for free the moment it becomes available is a nice touch that might get some people to think first before they buy digital copies elsewhere

Where was Siri?

  • Siri was not mentioned a lot at the event other than when talking about Apple Watch 3. This does not mean that Apple feels different about it.
  • Siri will have her moment when HomePod hits the market later this year, and I am still convinced we will see an all new Siri

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Carolina Milanesi

Carolina is a Principal Analyst at Creative Strategies, Inc, a market intelligence and strategy consulting firm based in Silicon Valley and recognized as one of the premier sources of quantitative and qualitative research and insights in tech. At Creative Strategies, Carolina focuses on consumer tech across the board. From hardware to services, she analyzes today to help predict and shape tomorrow. In her prior role as Chief of Research at Kantar Worldpanel ComTech, she drove thought leadership research by marrying her deep understanding of global market dynamics with the wealth of data coming from ComTech’s longitudinal studies on smartphones and tablets. Prior to her ComTech role, Carolina spent 14 years at Gartner, most recently as their Consumer Devices Research VP and Agenda Manager. In this role, she led the forecast and market share teams on smartphones, tablets, and PCs. She spent most of her time advising clients from VC firms, to technology providers, to traditional enterprise clients. Carolina is often quoted as an industry expert and commentator in publications such as The Financial Times, Bloomberg, The New York Times and The Wall Street Journal. She regularly appears on BBC, Bloomberg TV, Fox, NBC News and other networks. Her Twitter account was recently listed in the “101 accounts to follow to make Twitter more interesting” by Wired Italy.

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