There are a great many technologies that have gone from futuristic gadget to necessities of modern life. In most of the developed world, smartphones have escaped this realm of luxury items, just as computers did after the turn of the century. Research firm eMarketer estimates 1.76 billion people will use smartphones by the end of the year, with that number closing in on 3 billion before the end of the decade.
Smartphones acquired ubiquity by being an indispensable tool, by allowing people to accomplish something they could not do otherwise. There was no easy way to access the Internet from a mobile device before smartphones. Once the Internet became something we (arguably) needed, so too did smartphones.
Computers originally solved this issue, allowing people to connect to the Internet and get work done. Smartphones took it to another level, letting people do those things on the go with something that fits in our pockets.
That is why it’s no surprise Apple’s latest earnings show the company sold 39 million iPhones in the last quarter. iPhone sales continue to grow, baffling investors while lining Apple’s pockets.
What was unforseen is the growth of Mac sales. Apple sold 5.5 million Macs in the last quarter, more than any other quarter in its history. Yes, computer sales are growing for Apple, a fact that baffles most industry watchers. But it actually makes complete sense: The growth of iPhone and Mac sales are based around necessity. People need computers and smartphones, to work, to go to school, to get online. It should be no surprise that the company that, by most standards and opinions (including mine), makes the best devices in both categories would continue to see an increase in sales.
For most of us, a new tech product has to be an indispensable asset if we’re going to throw down major cash for it. Smartphones meet that standard for everyone. iPhone sales continue to increase, in part because the smartphone market is still growing, and because Apple produces one of the best phones on the market. Computers are still a necessity for the majority of people. Mac sales have gone up because Apple is producing some of the best computers in the world. It wasn’t always this way; Dell once held that crown and its sales reflected it.
Bottom line: Smartphones and computers are the only indispensable assets the technology industry is making. Tablets didn’t make it to that level, and the recent decline in sales reflects it.
Sales have shrunk once again for the iPad, for the third consecutive quarter. Revenues for the tablet are down 14 percent from this time last year. The iPad is still the best tablet on the market by a wide margin, even as Apple has seemingly run out of new ideas for it.
Yes, the decline in iPad sales can be attributed in part to lackluster updates. Apple says it doesn’t really know what the upgrade cycle for current iPad users is (smartphone upgrade cycle is two years for most users on contract), and that may hinder some of the updates it has planned for the device.
But for most people, it comes down to the fact that an iPad just isn’t a need. Necessity, or the lack thereof, is why iPad sales have stopped growing for Apple.
There’s this pervasive thought process in the technology industry that if a product is great, people will continue to buy it. That’s true for a certain demographic—people with disposable incomes who can afford to buy the newest toys on the market. But for the majority of people, a product has to prove itself. It has to significantly improve upon something in their lives before they will empty their wallets for it.
A great device that is for most a luxury can’t match the sales of a great device that is a necessity, and the technology industry has yet to show it is capable of building another product that is indispensable, and it’s not for lack of trying. The next attempt is the smartwatch.
It remains to be seen if the Apple Watch can be the device that will push smartwatches into the realm of “must-have.” Apple has said it won’t be offering sales numbers on the Watch when it launches, so it will initially be a guessing game. What we do know is Samsung, LG, and Motorola have all pushed out smartwatches that have been mildly successful at best.
Much like tablets in 2010, wearables in 2014 have been heralded as the next indispensable thing. Tablets have been a huge success for Apple—CEO Tim Cook said the company has sold 237 million iPads to date during an earnings call this week—but that rapid growth appears to have hit its peak.
The Apple Watch and smartwatch market overall could easily follow this path.
Apple will undoubtedly sell millions of Apple Watches. Building great products that millions of people enjoy isn’t an issue for the company. The question is whether it can continue growing the sales of the Apple Watch, or will four years be the cutoff before the public begins to lose interest in what was supposed to be the next big thing, just like the iPad.
The technology industry is pumping out great products at an unbelievable rate, but we have yet to see something that will dramatically change life for the better. Computers changed how the world operates, and smartphones changed how we communicate. The next device that will change everything and make you save up and stand in line for hours hasn’t been found yet, and that may be the case for awhile.
Creating a culture-shifting product isn’t easy, but this is the longest we’ve gone without one in some time. It’s been seven years since the iPhone was introduced. We went six years between the iPod and iPhone. Most thought the iPad would be the next in that line, but it’s looking like that isn’t the case. If the best tablet ever made can’t hold the interest of the public, what does that say about the tablet industry?
We are overdue for the next device that will change how we interact with technology. Could it be the Apple Watch? Maybe, we don’t know yet. What is clear is the industry needs that next big thing, the revolutionary product that will create complementary industries, like smartphones did for mobile apps. That product may be smartwatches, it may be a different kind of wearable device, or something brand new altogether.
Whatever it may be, it needs to arrive soon, because it’s been entirely too long.
Photo via Michael Vito/Flickr (CC BY SA 2.0)
