Why It’s Better for Apple If You Choose an iPhone over an iPad

December 25th, 2014

Last week, our broadband provider sent someone over to adjust our service. He arrived, saw my Macs, and proudly displayed his new iPhone 6 Plus. Now I had played with one for a while before to get a sense of it,  and felt it was just too big for my needs. You see, I carry around my iPhone in my left pants pocket, and the pockets of my jeans, while normal sized, make even an iPhone 5s or an iPhone 6 a fairly tight fit. But I am never fearful of bending one of them.

In any case, while he did his thing with fixing and replacing a cable modem and configuring jumpers and wires, he said I could work with his iPhone so long as I didn’t read his email or fiddle with the settings. I must have inspired his trust.

So I gave it a decent workout for the next 45 minutes or so, concentrating on the things I did on my iPhone, but also compared it to working on an iPad. Now the sole iPads in the family have been the standard or full-sized models. I’ve also been slow to warm up to an iPad, and the iPad mini seemed even less compelling.

But when I worked with the iPhone 6 Plus, even for that short period of time, I could see where the smaller display might still be tempting to someone who might have considered an iPad mini. More to the point, consider the inconvenience of lugging two gadgets compared to the possibly modest inconvenience of taking one somewhat large device that includes the cellular telephone. Indeed, in some parts of the world, people are using these gadgets, or phablets, as their one and only computing device. They do not have personal computers.

Now it’s well known that iPad sales have been flat for a while. One reason given is that users are keeping their iPads in regular use far longer than they hold onto smartphones. So figure maybe four years instead of two years, meaning that the owners of the original iPad  — and maybe the iPad 2 which isn’t terribly snappy on iOS 8 — might be ready to upgrade soon.

But the choices have changed. The arrival of the iPhone 6 Plus has certainly altered the equation, meaning that sales for Apple’s phablet may indeed be cannibalizing those for the iPad. To what degree, I wouldn’t be able to guess, although Apple might have some meaningful data to report during the financial conference call covering this quarter. That will happen in January.

In the meantime, experts and so-called experts will speculate about how well the iPad is doing. But that won’t be known until the real figures are in. It’s easy to guess based on sales reports from individual dealers, of course, and the industry analysts will be busy with their own interpretations, but they won’t be based on all the hard numbers.

It may not even mean anything that the iPhone 6 and iPhone 6 Plus are just starting to catch up with demand, but you can get pretty much whatever iPad you want without much of a delay. Perhaps building an iPhone 6 is a far more difficult process to do efficiently.

As far as Apple is concerned, though, the person who chooses an iPhone 6 Plus over most iPads will be delivering more profit to the company. Don’t forget that the U.S. retail price of Apple’s phablet range from $749 to $949, depending on which storage option you select. Remember that those zero down payment or low upfront cost deals are part of a wireless carrier’s service plans to rope you in. They don’t reflect what Apple earns from each sale.

The most expensive iPad Air 2 is $829, for a unit with 128GB storage and a cellular radio. Most purchases are for much cheaper models, and remember that the entry-level iPad mini can be had for $249. All told, selling you an iPhone 6 Plus is a better deal for them. Apple has always been happy to cannibalize its own gear. I would imagine they’d even prefer that iPad uses consider a Mac if they want something different. After all, a fully decked out Mac Pro can cost close to $10,000.

Now none of this is new or unusual. The numbers I’ve quoted are out there for anyone to examine, and few would dispute the fact that selling a pricier gadget with a higher profit margin is to be preferred. Mac sales have been hot too, and it’s possible some iPad owners who don’t go to the iPhone 6 Plus do consider the Mac alternative.

Apple is happy to accommodate those needs. But I wouldn’t presume to guess how well the iPad will fare this quarter or whether it’s necessarily to change something to goose sales. Some suggest Apple needs to deliver an iPad Pro, the alleged 12-inch model that, I suppose, would serve some professional users. But it wouldn’t be one of those alleged convertible note-books. Apple has made it clear they don’t believe in such things.

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