[Jason Snell at Six Colors]

"In the most recent financial quarter, Apple generated $24.4 billion in revenue from Services. The Mac, iPad, and wearables categories together generated just $22.3 billion. Only the iPhone is more important to Apple’s top line than Services."

This is an interesting piece about how Apple's services revenue is set to overtake its hardware business.

Over on his blog Pixel Envy, Nick Heer worries:

"It would be disappointing if Apple sees its hardware products increasingly as vehicles for recurring revenue."

I'd go further. The beauty of Apple's product line is that they're comparatively well-made products that push the boundaries of user experience, bringing technology breakthroughs to a creative audience: as Jobs put it, "bicycles for the mind". Customers (including me) accept higher prices because the products are exceptional, but that depends on a product line that is complete.

If the product offering is a higher-priced hardware device and premium monthly services on top of it, the investment starts to have diminishing returns. It's a loss of focus on what made Apple great, and why people keep coming back to it. It's greed, essentially: continuing to push the Apple user base further and further, assuming the breaking point is very far out.

That puts them at risk from being disrupted by someone else. Windows ain't it, but at some point someone is going to come in with a really great set of hardware on an alternative stack. The question won't be whether it beats Apple as-is, but simply whether it's good enough at a lower price point. And then that company will grow their offerings, until before you know it, Apple has serious competition. It's disruption 101, and the further Apple pushes out its expense and friction, the more susceptible it becomes.

#Technology

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