Apple Needs Out of Its Mid-Life Crisis

By Doug Mohney October 16, 2013

While Apple sells high-end phones faster than its cheap ones, Google is reportedly planning to introduce a smartwatch. Next week, Apple will introduce an all-too-obvious refresh for the iPad and computer lines. Can Cupertino see the writing on the wall? It needs to get out of its mid-life crisis and rediscover its mojo.

As predicted, buyers are embracing the iPhone 5S over the 5C. A report in the Wall Street Journal said Apple is cutting its orders for 5Cs while increasing them for the 5S, while a Canaccord Genuity analyst says the more expensive 5S is outselling the 5C at a ratio of 2.5 to 1. It is good short-term news for Apple shareholders, since the company makes more money from the 5S than 5C, but it is clear the company doesn't have a good strategy to expand its market share into more price-sensitive areas.

Canaccord Geunity analyst Michael Walkley predicts Apple will launch both smartwatch and television sometime after October 2014 – yes, a year from now – during its 2015 fiscal year. If this prediction is true, it will be a crowded smartwatch market, with everyone from Google to Samsung already selling products.   Google is expected to launch its "Gem" watch in conjunction with the Kitkat Android 4.4 release at the end of the month.   Sony, not exactly a barn-burner of innovation these days, released its second generation smartwatch earlier this week, with reports saying it is "outclasses" Samsung's Galaxy Gear in several areas, including battery life, slimness, and the ability to pair with hundreds of Android devices.

Image via Shutterstock

By October 2014, Sony will be in the third or fourth generation of smartwatch, Samsung will be in second or third round of hardware, and Google will be at least in round two. Apple will no doubt introduce a device that appeals to its core base of enthusiasts and seamlessly integrates with every iThing. 

Is it enough? By all indications, there won't be any new product categories out of next week's announcement.   This means Apple will be riding the iPad and iPhone as its primary hardware pieces, feeding into iTunes and the App store for content and software. 

The field is still open in the large-screen living room "TV" experience.   Microsoft has a significant foothold it continues to refine with its Xbox platform while cable companies seek to increase average revenue per household by offering a sophisticated mix of hardware, networking, and software to enable customers to view and record anything from live TV shows to pulling up movies on demand.

But after decades of development, nobody's come up with the right home viewing solution. Even Intel continues to fumble forward trying to put together the pieces for a service-based solution. Apple will still have an opportunity to make an impact in the field, but the clock is ticking. Sooner or later, someone will solve the Rubik's Cube of home entertainment.

Edited by Alisen Downey

Contributing Editor

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