Categories

Schiller’s Law

We know how many iPhones Apple ships but we don’t know exactly how many of each model. We can try to come close in such estimates of “mix” by looking also at the market pricing of the phones and the average price Apple obtains[1]

Combining what we know with some guesses allows some of us to estimate the composition of iPhone models in any given quarter’s sales. Here is a graph showing my estimates:

 

Screen Shot 2015-05-22 at 2.53.36 PM

Having this, we can then assess how each generation of iPhones has performed. Remember that although we had a new iPhone for each of the last eight years, there are only 5 generations in total. Starting with the 3G (second generation) the generations were two yearly product cycles long.

The resulting estimates for generational growth are shown below. 

Screen Shot 2015-05-21 at 6.41.02 PM

I included a second graph with revenues. Note that the iPhone 5 and iPhone 6 have not run their course. History suggests at least a five year run for any one generation and the 5 is at less than three years old and the 6 is at less than one.

The interesting question is therefore not whether each generation sells more than its predecessor but whether it does so by a substantial multiple. I drew in outline a few estimates on future volumes for the 5 through its end of life and for the 6 for the current and next year. Of course these are highly speculative but the question of how much can be expected from these generational leaps is interesting.

Recall that

When assessing sales for a new model of the iPhone, Apple used an easy shorthand: “Each new generation sold approximately equal to all previous generations combined.”

Phil Schiller’s Testimony in Apple v. Samsung trial

Such a pattern of growth, which I call “Schiller’s Law” is extremely difficult to maintain and probably won’t apply in the case of the 5 or 6. However the growth of the overall franchise is very apparent. In particular you can see how first year sales have a very healthy pattern of growth, especially when measured in terms of revenues.

Notes:
  1. ASP = Revenue/Units shipped. However, note that there are deferrals in revenue as part of this. []
  • Phil Evans

    Is the iPhone 6 (green) line missing from your Pricing chart?

    • El Aura

      No, the colours for the iPhone 6 and 6 Plus differ between the first and the second chart. On the second, the pricing chart, the iPhone 6 is a light orange and the 6 Plus a reddish light orange.

      • actualbanker

        key appears to be incorrect and therfore confusing. HD usually corrects these swiftly.

  • Jeff G

    Idea for future title: “Schiller’s List”

  • Annuj

    @asymco My hunch – “Schiller’s Law” will apply to iPhone 5 and 6 “revenues“ if you include and respectively allocate, the Apple Watch “revenues” (if ever announced separately) to each generation of iPhone with which the watch is compatible. I suggest to combine the revenues because watch buyers will always be iPhone owners making legitimate case for calling it a “combo-offering” and adding revenues.

  • mo

    عميلنا العزيز لا تتردد فى الاتصال بنا على ارقامنا الاتية
    0500205720
    شركة دليل المنزل تهتم

    نقل اث
    اث و
    نقل عفش
    وتنظيف
    المنازل
    وجلى البلاط وكشف
    تسربات المياه
    و كشف تسربات

    الغاز
    ورش
    المبيدات
    ومكافحة
    الحشرات
     والترميمات وعزل
    مائى
     للأسطح والخزانات وحمامات السباحة وتستخدم الشركة اساليب متطورة من عملية
    تطوير الذات و تحسين الكفاءة لتقدم خدمة كاملة الي عملائها و تحصل على اكبر قدر من
    التميز بافضل جودة وافضل اسعار لاشك ان المنافسة قوية ولكن توجد فرصة كبيرة للتميز
     سنصلك اينما كنت فنحن نعمل على مدار الاسبوع . نحن الأفضل للأننا نخدم الافضل .
    تعتبر دليل المنزل افضل شركة لكشف تسربات
    المياه بالرياض
    و افضل شركة نقل اثاث
    بالرياض
    ومتخصصون في كشف تسربات المياه
    في الرياض

  • TFM

    I don’t get how dividing Total Revenue by Total Units Shipped can provide insights in this respect! Can you please better explain me the rationale behind your calculation to get the numbers of each IPhone model? It would be very useful for my research! Thank you!

  • رضاابو مى