Galaxy Note 9 sets new bar for Android phone price

This year a lot of people will pay NZ$2000 or more for a phone.

Apple set the tone at the end of last year with an NZ$2100 iPhone X. Now Samsung has joined the party with an NZ$2000 Galaxy Note 9.

You can pay less. A basic iPhone X with 64GB of storage costs NZ$1800. The more expensive model has 256GB.

Samsung has an NZ$1700 Galaxy Note 9 with 128GB of storage. The NZ$2000 model comes with 512GB.

Whether you need that much storage when cloud storage is plentiful and mobile data is cheaper is beside the point.

Inflationary

These are two examples of how New Zealand’s Consumer Price Index or CPI is the nearest thing to an official measure of inflation. In the most recent year, it was 1.5 percent.

That means consumers paid 1.5 percent more for a typical basket of goods and services in the year to June 2018 than a year earlier.

Expensive

At NZ$1700, the Samsung Galaxy Note 9 is $100 more than last year’s Note 8. That’s 6.25 percent higher: more than four times the CPI increase.

Apple’s iPhone X doesn’t have a year earlier model to compare.

Instead, we’ll look at the iPhone 7 and iPhone 8. When it launched the iPhone 7 was NZ$1200. A year later the iPhone 8 went on sale at $1250.

That’s a four percent increase. Apple’s markup is smaller than Samsung’s, but still well ahead of the CPI.

Everyone is at it

It’s not only Samsung and Apple. The prices of Huawei phone models climbed over the years.

Even Oppo, where the phone’s low price is the most important feature, has increased prices.

If anything, Huawei and Oppo’s price increases have been steeper than Samsung and Apple’s because they come off a lower base price.

But don’t phones get better

You might argue that the newer phones are better so phone makers can expect to sell them for more money. There’s something in this, see below.

Phone prices were stable during for years while annual upgrades meant huge leaps in functionality. Today’s upgrades are incremental while prices leap.

Apple shows the way

Apple has always lead the way on phone prices. It’s no accident it is the world’s biggest company and enjoys large profit margins. That trillion dollar valuation didn’t come by chance.

When it launched the iPhone X last year, Apple showed it could push phone prices above the NZ$2000 mark without denting sales. That opened the door for its rivals to charge more. They won’t admit it in public, but the iPhone acts as their benchmark.

Apple sells fewer phones than Samsung or Huawei.

The iPhone makes up around 20 percent of the handset market worldwide. It accounts for around 80 percent of profits from phone sales. Almost all the remaining profit from phone sales goes to Samsung.

Profits

It’s not clear how profitable the other main phone brands are. It’s not even clear if they are profitable. The companies don’t break out figures in the way that Apple and Samsung do. Yet it’s clear they are not making big margins.

Until a couple of years ago the Android phone market taken as a whole ran at a loss.

Things have changed. In part that’s because phone makers have pushed up handset prices ahead of inflation. It helps that some of the big names have either gone to the wall or wound down their operations.

Price rises have two sides

Inside the phone business, people talk about the average selling price or ASP.

According to IDC’s Worldwide Quarterly Mobile Phone Tracker:

…”climbing ASPs continue to dampen the growth of the overall market”

…”Consumers remain willing to pay more for premium offerings in numerous markets and they now expect their device to outlast and outperform previous generations of that device which cost considerably less a few years ago.

IDC says worldwide phone ASPs are up 10 percent in the last year.

Sharper prices lower down the market

Phone makers love to tell investors they have managed to increase the average selling price of their phones.

In some cases, they have done this by bumping up prices on their flagship models while fighting tooth and nail further down the market.

You can still get bargains. Spend NZ$500 to NZ$600 and you can end up with something great. It won’t have the latest camera or tonnes of storage, but not everyone needs those features.

High prices could be here to stay

New flagship phones are expensive to make, but the cost of building a phone is a fraction of the selling price.

Putting more lenses and more camera sensors may cost a phone maker a dozen or so dollars. OLED displays, curved glass add to costs. Perhaps the biggest extra cost is the memory chips needed to boost a phone’s storage, there is a trend towards higher storage in phones.

Higher phone prices are unlikely to go away soon. The glory days of fast-rise phone sales are over.

People are now holding on to phones for longer, squeezing more value from the money they have already spent. So it becomes important for each sold phone to contribute a little more profit.

spark-vodafone-boost-mobile-data-in-tandemPeople get exciting about phone features. Productivity is more important yet often overlooked.

My work involves looking at a lot of new phones. Most are premium Android phones. It’s been a long time since I’ve seen one that I couldn’t recommend. Within limits they are all good.

The last was the Huawei P20 Pro. It could be the best Android phone on sale at the moment. I haven’t seen anything better in 2018.

When I spend my money on phones — I don’t have to because there are lots of loan models for specialist journalists — I buy iPhones. 1

For me, productivity is everything

There are two reasons for this. First, I use iPads and Macs.

Apple devices play well together. There’s something almost magic about cutting text on the phone and pasting it into a desktop Mac document. Likewise, everything syncs between devices. I started writing this post on an iPhone and finished it on a Mac.

I have spent a lot of money on iOS and MacOS software and services. Some of those tools are not available on Android. When they are, they can be as good. But more often, there is either no equivalent. Or the equivalent is second-rate or involves compromise 2.

My productivity plummets when I switch to an Android phone during a review. Apple won’t work for everyone, but it works for me.

Walled garden

Some people reading this will question my choice on the grounds that Apple is a walled garden. By that standard so is Android and so is Windows. Apple may be a walled garden, but it is a productive one for me.

Linux may be the pure ideological choice, but so is North Korea — and that’s how it feels sometimes.

Second, with Apple there’s never any question about security updates.

Apple is quick to patch and repair iOS, updating is often immediate. I can wake up and be ready to go from the day after a security issue appears. Some Android phones never get updates. Many get them, but slow. Even the better known brands can be slack.

Again, that won’t bother everyone, but it bothers me.

Apple isn’t perfect

This doesn’t mean I’m biased in favour of Apple3

Apple is not perfect. There are flaws. Most of the tech media is happy to pounce when one appears. This, by the way, is a good thing in general although it can get silly.

Either way, Apple’s flaws are generally things I can live with. The productivity gain is too precious to trade away.

One notable exception at the moment is the controversial new keyboard on MacBook and MacBook Pro models. I see it as a backward step.4

No doubt you can be just as productive with Android if you have the right mindset. It takes a different form of mental discipline. Whatever that is, it isn’t me.


  1. If I was going to buy an Android phone I’d pick one without a software overlay. Google Pixel and Nokia phones are good candidates. That’s because I have yet to find an Android overlay that isn’t frustrating. ↩︎
  2. Like handing over private data ↩︎
  3. Until Windows 8 I was happy with Microsoft’s walled garden. Switching back to Apple was an eye opener. My productivity soared. I accept this wouldn’t be the case for everyone and, yes, Apple kit can be more expensive. ↩︎
  4. I’m working on a personal answer to this. It may not suit you, but stay tuned anyway. ↩︎
Also on:

Apple 2018 iPadApple’s sixth generation 2018 iPad is a bargain. In New Zealand it costs NZ$540. For many people it is all the computer they will ever need.

Sure, there will be people who consider it dull next to the swept-up iPad Pro. It doesn’t have as many features. Yet it does one important thing that, until now, only the Pro model iPad could handle. The 2018 iPad works with Apple Pencil.

That’s great if you want to use an iPad to create art or jot quick notes without adding a keyboard or dealing with the device’s glass keyboard. This, coupled with the price should open up the iPad to new audience.

It’s a solid, reliable alternative to buying a low-cost computer. Some geeks will hate me writing that.

Half the price of an iPad Pro

While the 2018 iPad doesn’t have all the features you’d find in an iPad Pro, it’s close to half the price of the cheapest Pro. The basic model $540 2018 iPad Pro comes with 32GB of storage. In contrast, the cheapest iPad Pro model costs NZ$1100 and has 64GB of storage.

There’s a NZ$700 version of the 2018 iPad with 128GB. If you can find the extra $160 it’s worth it. If you have a large library of music, videos or photographs you’ll soon bump up against the limits of 32GB. With a 128GB you won’t need to continually swap out files to a back-up device or the cloud.

What you get with both models is the classic 9.7-inch iPad Retina display. There are not as many pixels as you’ll find on the 10.5-inch iPad Pro, but the resolution is much the same. It has 2048 by 1536 pixels compared with the Pro’s 2224 by 1668. The 2018 iPad weighs exactly the same amount as the 10.5-inch iPad Pro; around 480 grams.

At 7.5mm, the 2018 iPad is a sliver thicker than the Pro which is just 6.1mm. That’s enough to notice, but not much of a compromise. It’s about 10mm shorter and 5mm less wide. This means you can’t swap covers or keyboards between the two devices. Not that many people will be doing that.

Adding a keyboard

And anyway, the 2018 iPad doesn’t have the Smart Connectors found on iPad Pro models. These make it easier to use a keyboard without resorting to Bluetooth. If you want to run a keyboard with the 2018 iPad there are dozens of options, many are excellent.

The speakers are not as loud or as clear as you’ll find on an iPad Pro.

Another difference between the Pro and the 2018 iPad is that you only get a first generation Touch ID button. It’s a little slower than the newer version and more prone to stumble when you use a fingerprint to sign-in. This is noticeable in practice if you’re stepping down from a newer iPad Pro or have an iPhone 7 or 8.

There’s a software difference too. The 2018 iPad only allows two apps to appear on screen at any time. While the Pro models allow three, this is something I never use on my tablet. I doubt many others will miss it.

The 2018 iPad uses Apple’s A10 Fusion chip, it’s similar, but not as powerful as the A10x Fusion chip in the Pro model. In theory it doesn’t run as fast, you could probably prove this by running benchmarks. In practice, you won’t notice. I didn’t find any lag on the 2018 model, it doesn’t feel slower. In fact, when it comes to speed, it feels almost exactly the same as my first generation 9.7-inch iPad Pro.

Where the 2018 iPad fits

Apple launched the 2018 iPad with an emphasis on education. It’s a great choice for students. Apple critics will tell you the iOS operating system is a walled garden and restrictive. Although there is some truth in this, in practice iOS is as open to the rest of the computing world as all the alternatives. Chromebook, Android and Windows are all as flawed in their own ways – possibly more flawed given their business models.

I’ve spent much of the last year using a 12.9-inch iPad Pro as my main mobile computer. It doesn’t do everything I need, but for most purposes it is more than enough computer. It has travelled overseas and out-of-town with me several times. For the most part the limitations of the 2018 iPad would be the same. If you’re on a tight budget and don’t need a lot of fancy features it could be all the computer you need. It’s a great device for creativity, just don’t expect to edit movies on it’s 9.7-inch screen.

The key to the 2018 iPad is that you get a lot of computer for not much money. You can buy cheaper Chromebooks, Android tablets and, at a pinch, Windows PCs. Unless you’re looking for an app that doesn’t appear in Apple’s store, this beats all those devices for most people who have light computing needs.

Also on:

phone cameras

Every recent high-end phone launch has focused, sorry about that, on the camera. Likewise, every phone promotion or marketing campaign pushes cameras to the fore.

Samsung launched the Galaxy S9 in Auckland last month. The company invited journalists to an open plan restaurant. There, Samsung invited journalists to photograph the chef preparing food.

The menu included a dish with a viscous pour-on sauce. This was a clever way of highlighting the S9’s very slow motion video function. The results were impressive.

Samsung hired a video professional to take slow motion footage of bees entering a hive. Shown on a giant TV screen, the pictures were crystal clear and, at times, had stunning clarity.

When phone makers show journalists new devices, they devote at least half the time to cameras.

Apple and Huawei have the same emphasis on photography.

Phone makers with smaller budgets push camera features to the top of their press releases.

Camera talk

During technical presentations company insiders talk at great length about phone features. At least a third of allotted time is camera talk. You can come away with the impression that’s all they want to talk about.

Every phone maker mentioned so far and some others will tell you they have the best phone camera. In a limited sense most of them are right, although it depends on your terms of reference. No phone costing, say, $800 or more has a bad camera.

In the last year or so, every phone maker used the word ‘bokeh’ at least once in their launch presentation. It would not be hard to make a cliché bingo card for phone launch attendees.

If this sounds like ‘me too’ marketing, well, it can be at times. Every phone maker thinks a fashion parade is an original idea.

There are important difference. Each company’s best camera excels at something else. Samsung’s Galaxy S9 does well in low light and can do very slow motion video. Huawei’s Mate 10 is best for black and white photography.

Most phone makers can point at unique camera hardware features. They can all point at unique software.

The quality of still and moving pictures from high end phones is remarkable. If you know what you’re doing — we’ll come back to that — you can take wonderful images. This is even more impressive when you consider how small the lenses are. Phone lenses are prone to finger smudges and camera shake is a given.

A point of difference

So why do phone makers put so much emphasis on cameras? An obvious reason is cameras differentiate what are otherwise me-too products.

Telephony and connectivity are much the same on all phones including cheap ones. Screen resolution is higher than the human eye can perceive. Few high-end phones struggle with processing power. These days they all look alike.

While there is a huge and obvious software difference between Apple’s iPhone range and Android handsets, you couldn’t say the same for Android models. Phone makers add their own software skins to stock Android. In almost every case this detracts value, at least from the customer’s perspective.

This leaves cameras and camera software as a playground for creativity and innovation. Which, in turn, brings us to the second reason phone makers place so much emphasis on photography.

Phone hardware designs and specifications have stabilised. With the move to remove bezels, that is the borders around screens, there’s little left to tinker with. Samsung struggles deciding where to put its fingerprint scanner. Otherwise, physical phone design has reached a cul-de-sac, at least for now.

The Galaxy S9 looks so much like the S8. Samsung had to come up with a new case colour for people wanting to show off their new phone.

Room for improvement

Over the last few years phone makers found room for improvement in their camera hardware and software. It’s likely this will soon reach another dead end. The laws of physics mean there’s only so much you can do with a tiny lens and sensor array.

The last big innovation was the move to dual lens cameras. This hasn’t played out yet. Meanwhile, at least one phone maker, Huawei, is talking of a triple lens camera.

There’s a danger this could become like the disposable razor business. There, for a time, adding an extra blade gave the appearance of innovation to an otherwise evolved product. It could be like tail fins on 1950s American cars. In effect we’re talking innovation for the sake of having an innovation talking point.

Another danger is that customers are loosing interest in phone cameras. Or, more likely, customer interest in phone cameras is not in alignment with phone maker hype.

Take, again, the Samsung Galaxy S9 slow-motion video feature. As mentioned early, the results are impressive, but how many Galaxy S9 buyers will use it?

Or, more to the point, how many will continue to use it beyond playing around with it when they first get their phone?

You can ask the same question about many of the camera innovations phone makers promote. Is the beauty mode, which attempts to make people look better, anything more than passing fad. How many phone owners have taken more than a handful of bokeh shots with blurred backgrounds?

Are people buying cameras or phones?

Slow-motion video is nice-to-have, but it’s unlikely more than one phone buyer in 20 will use it often. Similar reasoning goes for all fancy high-end phone camera features.

The flip side of this logic is worth considering. High-end phones with fancy camera features sell at a considerable premium. You may pay NZ$500 extra to get that super camera in your hands. If you only use it a dozen or so times, that feature has cost you $40 a shot.

Skeptical readers might see the industry’s obsession with camera phones as a way of forcing up handset prices. It also repairs margins in a business where only Apple and Samsung make decent money.

Of course, you can use phone cameras for serious work. If you need to take pictures in your job, the extra cost can be a smart investment.

Yet, in general you can’t take pictures of the quality you’d get from a SLR or any decent camera with a much bigger lens and sensor array. Phone cameras are handy, we carry them with us all the time. And the quality is so good that at times it is hard to tell if an iPhone or a Canon took the shot.

Hard to use

One phone camera drawback is they are hard to use in a hurry. Sure, all the phone makers tell us how easy their products are to use. Even so, the software can be confusing.

Phone camera interfaces are often tiny and you need to hunt around to find controls. Almost everyone uses the default mode for every shot. What’s more, stabbing at controls on a phone screen is not the best way to steady your hand to take pictures. Adjusting and using a digital SLR is easy in comparison.

There is still some room for improvement with phone cameras. Among other things Huawei’s third lens could do the trick. There is scope for yet more innovation in the software and, yes, a better user interface.

No doubt other improvements are in the works. At best we may see one or two more cycles. In the meantime some phone makers are switching their marketing attention to what they call AI or artificial intelligence.

It’s questionable whether this is real AI in the sense that the software learns things from use. There’s also a big question over whether phone buyers give a toss for this approach. We’ll see.

End of the golden age

Phone makers face a far bigger problem than competition with each other. It appears phone sales have faltered and now may be about to end the same kind of fall that has plagued the PC sector.

People are hanging on to phone longer. Research companies like IDC and Gartner put this down to consumers not being so enchanted with new feature that they feel a need to upgrade.

Given the marketing emphasis phone makers put on cameras, that can be evidence they are out of sync with what customers want. Whatever that is, it’s unlikely to be a way of taking better photographs or videos.

Also on:

macbook pro keyboard

Marco Arment has a number of suggestions for Apple in Fixing the MacBook Pro. Arment’s post runs down a list of the things that are wrong with the 2016 MacBook Pros and offers suggestions for putting them right. It covers four areas, but the main one and the problem that bothers me personally is the new MacBook Pro keyboard.

Arment writes:

Butterfly key switches are a design failure that should be abandoned. They’ve been controversial, fatally unreliable, and expensive to repair since their introduction on the first 12” MacBook in early 2015. Their flaws were evident immediately, yet Apple brought them to the entire MacBook Pro lineup in late 2016.

The decision to use the butterfly key switch keyboard looked odd at the time. One reason people thought earlier MacBook Pro models were among the best-ever laptops was the solid keyboards. They were great. Dropping the earlier design looked and felt like a mistake at the time. Yet, as Arment points out, things only got worse when it emerged they were unreliable and required an expensive, fix.

He says:

After three significant revisions, Apple’s butterfly key switches remain as controversial and unreliable as ever. At best, they’re a compromise acceptable only on the ultra-thin 12” MacBook, and only if nothing else fits. They have no place in Apple’s mainstream or pro computers.

Maybe not. But here’s the strangest thing. I have a 12.9 inch iPad Pro with the Apple Smart Keyboard. It is great to type on. Yet it uses the same basic butterfly key switch.

I’m a touch typist and hammer keyboards because I learnt to type on manual typewriters. The Smart Keyboard may not be perfect, no portable keyboard is, but it is a far better experience than typing on a new MacBook or MacBook Pro.

When I wrote about the MacBook Pro keyboard before, I found it acceptable, but clearly preferred the keyboard on the Air.

Few options beyond MacBook Pro

My ageing MacBook Air is coming up for replacement. After looking at the MacBook and MacBook Pro keyboards and deciding they are not for me, I’m thinking about the options for my next portable computer. At this stage the shortlist is go with the iPad Pro and get a desktop iMac for home, buy a new MacBook Air or wait until there’s a refurbished older Retina MacBook Pro in the local Apple Store.

While buying a refurbished machine is good for the planet, it doesn’t seem right. A new MacBook Air would be a productive choice. Yet I prefer Retina displays. The MacBook Air specification is old-fashioned by late 2017 standards.

Which means the most likely choice will be the iPad Pro and iMac. That’s remarkable as it means for the first time in years there isn’t a MacBook model that meets my needs. All because Apple doesn’t offer one with a decent keyboard.

Back to Arment:

The MacBook Pro must return to scissor key switches. If Apple only changes one thing about the next MacBook Pro, it should be this.

It needs to do this soon to get my business. I’m probably not alone. And yet it’s unlikely Apple will move because it seems the new MacBook Pros have been selling better than expected. If the market has spoken, whatever it said was not: “fix the MacBook Pro keyboard”.