Jan 2, 2019
Tim Cook to Investors: People Bought Fewer New iPhones Because They Repaired Their Old Ones
Wednesday, Apple CEO Tim Cook wrote a letter to investors alerting them that the company would miss its revenue targets in part because Apple didn’t sell as many iPhones as it expected. The lengthy letter cites, specifically, that people are buying fewer iPhones because they are repairing their old ones.
Apple has long fought efforts that would make iPhones easier to repair: It has lobbied against right to repair efforts in several states, doesn’t sell iPhone replacement parts, sued an independent repair professional in Norway, worked with Amazon to get iPhone and MacBook refurbishers kicked off Amazon Marketplace, and has deals with electronics recyclers that require them to shred iPhones and MacBooks (as opposed to allowing them to be refurbished.) The Department of Homeland Security, meanwhile, has seized iPhone replacement parts from prominent right to repair activists in the United States.
At the announcement event for the iPhone XS, Apple said that keeping your old iPhone “is the best thing for the planet,” but the fact remains that selling new iPhones is best for Apple’s bottom line. That’s why many people suspected that “throttle gate,” in which Apple was caught slowing down iPhones with old batteries, was a ploy to sell more iPhones (the phones were slowing down to prevent them from shutting off, but Apple never disclosed this to the user.) Though there’s no evidence that Apple has a business model based on planned obsolescence, the company attempted to downplay the fact that it was slowing down people’s old phones without telling them, which had the side effect of helping the company to sell more phones.
After widespread public outrage, Apple eventually offered to replace people’s old iPhone batteries for $29, which would end throttling and make older phones run faster. That program ended on December 31.
Apple has never clearly articulated why it doesn’t want people to fix their own iPhones or to have independent experts repair them. It has previously said that iPhones are “too complex” for users to repair them, even though replacing a battery is pretty easy and is done by average users all the time.
But the fact that repair hurts Apple’s bottom line came out in Cook’s official communication with shareholders, who he is legally obligated to tell the truth to.
“While macroeconomic challenges in some markets were a key contributor to this trend [of lower iPhone sales], we believe there are other factors broadly impacting our iPhone performance, including consumers adapting to a world with fewer carrier subsidies, US dollar strength-related price increases, and some customers taking advantage of significantly reduced pricing for iPhone battery replacements,” Cook wrote, also citing fewer sales than expected in markets like China.
Right to repair advocates have long argued that Apple customers would be able to get a lot more out of their devices if Apple gave them the ability to repair them, but say the company doesn’t want to do that because it will hurt its bottom line. Here is evidence that they might be right.