Apple CEO Tim Cook set a goal last year for Apple to double its income from Services. He said in this week’s earnings call that the company was ahead of the game in this ambition.
But important as it is for Apple to boost its Services income at a time when hardware sales are relatively flat, the company’s enthusiasm for this target could well have some unintended consequences Many of us have complained long and loud about Apple’s ridiculously stingy free iCloud tier of just 5GB – which isn’t always enough to backup even a single iPhone, let alone all the iOS devices a customer may own. But while the most charitable spin one could put on this would be that Apple is out of touch with today’s world, John Gruber has a less generous interpretation.
By continuing to offer an inadequate free tier, Apple is forcing customers onto the paid tiers, thereby generating Services revenue. But it’s money gained at the expense of customer satisfaction with the company.
Many people pay the fee, but grumble as they do so, and feel that Apple isn’t behaving as it should. We also saw another quiet announcement from Apple which may also be related.
The company is removing apps and in-app purchases from its iTunes affiliate program. By withholding those commissions, Apple gets to keep more money in the Services pot. Read more from 9to5mac.com…
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