These are the big takeaways from Apple’s latest fiscal earnings report. Credit: Apple iPhones don’t matter as much anymore. People are buying less hardware, want the products they use to last longer and are more prepared to invest in access rather than ownership. Those are the main takeaways from Apple’s fiscal call on Tuesday. iPhones don’t matter anymore I’ve been saying this since before people understood what I was saying. I continue to argue it now: Yes, iPhones will be the center of Apple’s super-private and ultra-secure ecosystem, but the neurotic desire to purchase a new one annually is going to shrink in favor of a more Earth-friendly (and, indeed, climate responsible) approach of getting the most out of the device you’ve already got. Apple told us as much when it announced the devices iOS 12 would support at WWDC 2018. The company isn’t investing billions in responsible product manufacturing, distribution and supply just for the sake of a few positive column inches – it really doesn’t want the world’s desire for smartphones to mean millions of children develop pollution-related asthma, islands disappear under oceans or crops fail. While highly-paid shills still deny it, climate change is real, this is an emergency, and anyone purchasing any kind of consumer electronic device should skip the dollar price and look at the environmental costs of the devices they buy. Here’s a good place to start. We’ll spend more for better, but want it to last Apple proves that consumers don’t mind paying more for good products that deliver consumer experiences they enjoy – and that hold onto resale value. The need to get more out of the products we have is an inevitable consequence of the growing awareness of the consequences of unmitigated manufacturing and a street-level reaction to get more from less to mitigate those impacts. It’s also a highly appropriate reaction to changing economic circumstances. We’re more prepared to buy less, but pay more, if we are getting products that will last longer. I’ve no doubt whatsoever that Apple understands this and will find ways to enable consumers to spread the cost of those big purchases over longer time periods. Think iPhone rentals, upgrade programs, carrier subsidies and more. Access is becoming more important than ownership We’re at the beginning of another big shift in consumer preference. Rental is becoming a more viable option as the cost and consequence of ownership grows. This shift began in the music industry, really: Even as Apple pushed for iTunes Store download sales, many in the industry sought ‘Access Not Ownership’ business models, a move that culminated in Spotify winning support from the big labels. Apple Music now has around 50 million paid subscribers. Apple has a range of announced initiatives designed to capitalize on this trend – Apple Card, Apple News, Apple TV+ and subscriptions via its App Stores, as well as more traditional models such as iCloud. Apple told us that it now has hundreds of millions of services subscribers generating around $11.5 billion in the quarter and $22.3 billion across the last six months. Those are huge numbers – more than the revenue generated by that quarter’s Mac and iPad sales combined. “These aren’t hobbies,” said Apple CEO Tim Cook announcing the results. “We’re always working on new things.” The Next Big Thing Apple’s initial services may seem quite traditional, but I’ll raise my head above the parapet and predict more to come: Among other initiatives, I can imagine the company revealing Apple Card-like links with healthcare firms; Pure-play Apple product and services rentals packages; and further investments in existing car and ride-sharing schemes as operated by some of the big automobile firms. While many will resist the siren call of handing all your cash to Apple on a monthly basis, there will be millions prepared to fully invest in the entire Apple ecosystem for a set monthly fee, particularly if they also get 3% cashback using Apple Card. To me it seems clear that by pivoting the company’s business to reflect emerging consumer trends, and by supplementing its traditionally product-driven model with a very strong services income, Apple is proofing itself against slumped hardware sales. In doing so, it is also freeing itself from its somewhat limiting identity as a product-driven company that’s only ever as good as its last Big Thing. The bottom line? Apple will be selling less (less does not mean none) hardware, more services, and will still maintain a profit. Until its Next Big Thing, which will surely drive into view by around 2022. Please follow me on Twitter, or join me in the AppleHolic’s bar & grill and Apple Discussions groups on MeWe. Related content news analysis Apple earnings: About that iPhone 'slump' in China Based on information from Thursday's earnings report, it seems that data pointing to an iPhone slump in China were over-baked. By Jonny Evans May 03, 2024 9 mins iMac iPhone Apple news analysis Apple confirms it will open up the iPad in Europe this fall The latest efforts to comply with Europe’s Digital Markets Act mean developers can offer to side load apps to both iPhones and iPads in the EU. Apple has also taken steps to improve what it offers to smaller and non-commercial developers in the By Jonny Evans May 02, 2024 6 mins iPad Apple Mobile Apps news Mosyle and Fleet bring new device management options to Apple enterprise Apple's growing enterprise market share is generating tons of opportunity for the company's partners in the device management market. Their approaches reflect the diversity of use. By Jonny Evans May 01, 2024 4 mins Apple Mobile Device Management Mobile Security feature Apple is intensely focused on its global AI efforts When the ship that is Apple moves in any direction, you can always count on careless whispers to expose the destination. From research labs to sophisticated AI models and Apple Silicon for server farms, here's what we've learned in just one By Jonny Evans Apr 30, 2024 6 mins Apple Artificial Intelligence Podcasts Videos Resources Events SUBSCRIBE TO OUR NEWSLETTER From our editors straight to your inbox Get started by entering your email address below. Please enter a valid email address Subscribe