All good things come to an end, even for Apple
Editor's note: On Jan 2, Apple CEO Tim Cook issued a profit warning in a letter to investors saying that due to new product supply restrictions and weak emerging markets, the first quarter would be less than anticipated. Liang Yunfeng, a columnist, comments in a post:
This is the first warning about its profit prospects Apple has issued in nearly 20 years, and it is because the slowdown in economic growth has prompted consumers to postpone changing their smartphones. Statistics show the global smartphone industry has declined for four consecutive quarters, with fewer and fewer consumers deciding to change their phones.
Apple has been heavily reliant on its smartphones. Over the past four years, more than 60 percent of Apple's net revenue, more than 65 percent of its gross profit and over 80 percent of its digital services fees come from iPhone.
And the technological innovation in the mobile phone industry has almost reached its ceiling under current technology conditions. Many functions that iPhone took pride in are now commonplace and Apple has already lost its leading position in smartphone research and development in the industry.
The competition in the market has become fiercer, and it is more difficult for any single brand to dominate the market. In fact, Apple had already reaped the rewards of its input into iPhone, and it has already done a good job in maintaining its position and profitability over such a relatively long time.
Almost all big companies are looking for the next growth point after the mobile internet era, such as virtual reality, automatic driving and artificial intelligence. If Apple does not make changes, it will probably suffer the same fate as Nokia, which had done nothing wrong before being weeded out as other companies overtook it.