alt Hacker NewsHistorically, cannibalizing has always been the right choice when it comes to such things. That was a major point of the first iPhone, that it was a full replacement for your iPod, which was instrumental in its success. All this thinking does is cloud ones judgement and let competitors succeed.
Not saying you are wrong, this may be the reason Apple operates nowadays, but I maintain it is shortsighted.
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That said, the iPhone was more expensive than the iPod, and replaced 1 Apple device (plus a device made by someone else like Nokia) with 1 alternative Apple device. This had an expected increase in revenue per customer.
Replacing the MacBook + iPad with an iPhone + some dock accessories might reduce revenue per customer.
Ben Thompson of Stratechery talks about this all the time. It didn’t take courage to canibalize a $200 ASP iPod for an $800 iPhone.
We agree.
Two bits floating in my mind: I'm in management (different sector, totally different scale) and deciding to move forward against a market as a market leader is a really scary decision. We did and changed our proposition against a trend in the market. The market mostly followed our lead. Thats what we hoped for, but sure couldn't count on at the time of the decision. So we had to make sure to have all stakeholders involved in the risk - What if most of our customers just left? Then suppose you are in management for Apple. The stakes are massive. How would you communicate this shift?
The other one is: You should take the strength of your opposition into account when making bold moves. Android / Google / the brands fabricating the products I would say (no need for the old debate) are market followers. They are good at following and produce more technical diverse products, minus the margins. If you do not expect your opposition to make the bold move first, but do expect them to follow your bold move, I would argue you should be less likely to play bold moves unless you know they cannot follow you. So game theory I think also favors the status quo for Apple.