While rumors are still flying around about the Surface Phone release date, Apple has decided to sell all variants of unlocked iPhone 7 and iPhone 7 Plus. Apple is due to release its quarterly earnings on October 25, and the company could post a dip in iPhone sales for the fourth quarter 2016.
This could be the first year that Apple posts negative growth in iPhone and device sales for the full fiscal. Apple releasing unlocked versions of the new iPhone 7 and iPhone 7 Plus is possibly in preparation for a possible Surface Phone release this month, among other factors.
There is strong speculation in the media about an October 26 release date for the Surface Phone from Microsoft, but so far the company has been tight-lipped regarding anything to do with a smartphone bearing the Surface brand name.
Why is Apple Releasing Unlocked iPhone 7 and iPhone 7 Plus This Early?
It’s highly unusual for the company to release unlocked versions of their newest phones so soon after the official launch. That could indicate a need for more sales during this holiday season when sales of electronics and other gift-able items typically peak for the year.
Apple has been trying to create strong alternative revenue streams to device sales, such as the App Store, Apple Pay, Apple TV, Apple Music and so on, but none have yet matched the huge revenues that devices bring in every year.
Overall sales, in fact, dropped $7 billion over the prior period in 2015. Last year, during the third quarter, Apple made $49.6 billion; in Q3 2016 the company posted $42.4 billion. So Apple needs device sales, that much is clear.
In fact, just iPhone sales alone are currently 4X what Apple makes from services like Apple Pay, AppleCare, Internet Services, licensing and so on. iPhone sales accounted for $24 billion of the $42 billion that Apple made last quarter, so it’s clear that the company is still heavily dependent on iPhone sales.
That’s a good enough reason for their decision to release the unlocked iPhone 7 and iPhone 7 Plus within 6 weeks of the official launch. And now that Chromebooks are threatening Mac sales and Google Pixel is going for an all-out ad strategy in the hundreds of millions, Apple cannot afford to give them any room to grab market share. Throw the Surface Phone release rumors in the mix and what we’re looking at is Apple executives sweating from the heat of the competition – probably for the first time in 10 years since the first iPhone was launched.
The failure of Samsung’s Galaxy Note 7 will have given them a big boost, for sure, but Apple wants to double down on that advantage and push as many iPhones possible this holiday season.
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