Steve Job’s announced today that Apple’s (AAPL) iPhone has sold 4 million units in the 200 days since it went on sale. Not good enough.
The stated goal from Job’s, who is famous for his low ball objective that he can then blow away was 10 million units by the end of 2008. Currently Apple has averaged 20,000 units a day. The shine comes off this number when you consider about 1,000,000 were sold the first 30 days (estimates vary). That leaves us at 17,600 a day since.
In order for the “goal” to be accomplished, Apple must hit a daily average to 18,100. Questionable. One has to acknowledge the initial US launch euphoria will not be seen elsewhere and holiday season two will not approach #1. When you consider Europe’s launch has been tempid at best and plans for China seem to have fallen through at this point. Canada is rumored to launch any day now but how many users will switch from the hometown Research in Motion for Apple? If the US does indeed head for a recession or dramatic slowing, how many folks will be willing to pay $399 for a phone? The argument is that high end users are buyers of the phone but if results at Tiffany’s (TIF) and Coach (COH) are any indication, these folks are cutting back also.
Now, does this mean the phone has been a “flop”? No. It does mean that a $599 phone will not dominate a category. Jobs seemed to have realized this when he lopped $200 off the price 90 days after the launch as sales stalled.
As the details of the phone trickled out in May last year, 2 months before the phone hit the stores I said the phone would be a flop. I was wrong. I also said “cut the price to $299 and you may have something. A $599 phone will not gain mass acceptance no matter what it does, especially when people can still get it’s functionality from their existing devices. Also, the exclusive deal with AT&T was not a very bright idea”.
I would say right on both those accounts. I think Apple really missed the boat with the exclusive AT&T (T) deal. With Research in Motion (RIMM) coming out with a competing product very soon that will be available on most carriers, I think Apple may have missed its chance to dominate the landscape. As things stand now, RIMM has 36% vs 19% to Apple of the “smart phone” market. Let us not forget Google’s (GOOG) highly anticipated foray into the market later this year.
The sad thing is that it is a self-inflicted move as Jobs’s history of not playing nice with others may have come back to bite the company. He may have got the “best deal” from AT&T at the expense of much bigger things.
Disclosure: None
2 replies on “MacWorld: iPhone Sales Will Fall Short of Jobs’s "Goal"”
Apple’s sold four million iPhones in six months — that leaves them twelve months to sell an additional six million units to reach their stated goal. If they sold four million iPhones every six months, Apple would have surpassed their self-imposed goal selling twelve million units by the end of 2008. Your hypothesis assumes the most important factor is it’s American debut. Of course, this dismisses all the additional countries Apple will be selling the iPhone in by the end of 2008. Further, this dismisses any momentum that’s being created as the iPhone becomes popular. When was the last time you met an iPhone user that hated the thing? Really. If that person turns even two people on to the devise.. and they turn on two users.. and so on. Ten million phones seems almost as ridiculous as your article. Thanks for your time. Robert
The goal was actually to sell 10 million cellphones during the 2008 calendar year. From Steve Jobs Macworld 2007 keynote…
“….exactly what we’re trying to do, 1% market share in 2008, 10 million units and we’ll go from there.”
[ see also http://www.blogsmithmedia.com/www.engadget.com/media/2007/01/dsc_0245.jpg ]
The iPhone went on sale 29th June. Apple announced 1 million sold on 10th September ( 74 days, 13.5k/day ), 1.39 million by 31st September ( 95 days, 14.6k/day ) and now we hear 4 million sold by 15th January ( 202 days, 19.8k/day ). Clearly the sales rate is increasing. If you just look at the last known period of 1st Oct to 15th Jan, the ‘current’ sales rate is 24.3k/day.
The iPhone wasn’t even on sale in Europe until November, and is still only available in 3 countries representing less than half of the European population. It’s also not on sale in Asia, who are perhaps holding off for a 3G version that Apple have stated will be available later this year.
Really, a goal of 10 million cellphones during this year seems like an absolute cert.