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The Looming Demise of the iPhone mini - MacSparky:

The part that gets me is that they really shouldn’t be forced to make a decision. Isn’t Apple selling enough iPhones that they could afford to sell small, medium, and large versions of the pro and non-pro phones? You’d think they could make that work, but, for whatever reason, they are choosing not to.

David Sparks take the customer-centric Apple question, but the answer is business-centric.

I’m an owner of an iPhone 13 mini who is also currently reading The Paradox of Profit by Jan Eeckhout. As well as being a fascinating book in general, it also provides an excellent framework to answer the question about why there won’t be an iPhone 14 mini, posed by MacSparky, despite the fact they could.

Apple is a company that has market power. A company with market power will produce less, in the interest of profit.

If Apple were to produce more iPhones (and the mini, specifically) it would result in lower profit margins. iPhone minis have been sold at a lower price than other iPhones. What incentive does Apple have to continue selling something that doesn’t boost their margin? Companies continue to be incentivised to deliver profit; not the best market outcomes. They also wear the cost burden of another manufacturing line to maintain, for little benefit to the business.

As much as we Apple fans like to deify Apple Inc., they remain a corporation with shareholders who look to quarterly earnings reports and admire the gross margin the company delivers, which flows through to the bottom line, and thus dividends.

Producing an iPhone 14 mini might please a few million customers, but the economic incentives at play are perverse. Therefore, they will not make an iPhone 14 mini, and be rewarded for this action with greater profit margins.

Apple has sufficient market power such that would-be buyers of iPhone minis will not depart the iPhone brand in favour of Android, or another option (which there really isn’t, which introduces a whole other problem of there being a platform duopoly). What the customer will do is buy a higher priced iPhone that delivers better margins to Apple.

Therefore, Apple will be rewarded for producing less, at higher prices.

I highly recommend The Paradox of Profit to others who have an interest in macroeconomic theory.

This article was originally written for the November 2021 edition of Hemispheric News, delivered as part of the Hemispheric Views podcast member bonus program, One Prime Plus

Since it’s Nostalgic November, I figured I should write something that fits the theme for the November issue of Hemispheric News.

What is nostalgia, however? According to Apple’s dictionary, nostalgia is defined as:

a sentimental longing or wistful affection for a period in the past.

According to Wikipedia, it is:

a sentimentality for the past, typically for a period or place with happy personal associations.

Nostalgia is associated with a yearning for the past, its personalities, possibilities, and events, especially the “good ol' days” or a “warm childhood”.

Ah, yes, the good old days. As the elder statesman of the Hemispheric Views triumvirate, my good ol' days are certainly better than the others, especially that whippersnapper Feld. He may speak like an old man, but don’t be fooled. He never saw the 1970s.

What am I nostalgic for, then? In many ways, my life now is the best it has ever been. I am as wealthy as I’ve ever been, I’ve got sufficient social status and I’m engaging in hobbies I genuinely enjoy.

Perhaps playing basketball - when I was athletic and could jump, dunk and score with confidence? No. I miss that, for sure, but I’m not nostalgic for it. I’m proud of myself but there is no strong yearning to go back.

How about school and education? No way am I nostalgic for that. School was hard. Not the lessons, study or exams. They were easy. No major issues there. But dealing with the ups and downs of school friendships, politics and teenage angst? Hard pass.

There must be something I hold nostalgia for!

If I sit and think about it now, I feel nostalgia for the time when I was young in my career. I had few responsibilities other than keeping myself alive and paying the rent. I had independence. I could come home, sit in my La-Z-Boy recliner chair, watch the “Attitude Era” of WWE Raw and let the hours flow by.

The Internet was in its infancy. I had a computer that was connected but my mobile phone was purely a “feature phone”. There was no expectation to document my days, or justify how I spent my hours. Leisure was a primary element of what I did. Yet there was no guilt, because I worked full hours in a proper job. But come evening time, that was mine to do with as I wished.

And with that time, I didn’t do much and that was kind of perfect. Going back to that time now is of course impossible. It would also mean giving up all the things that give me meaning and value now: my wife, my children. I can’t go back.

Sometimes, though, I want another night where I sit on the couch and watch wrestling - without having to make sure anybody besides myself brushes their teeth before bed.