By William Davis 

If you missed it, and gosh we hope you didn’t, last Wednesday marked the silk and linen anniversary of the iPhone. Yep, it was 12 years ago when Steve Jobs introduced his little device to a bunch of geeks at the 2007 Macworld convention in San Francisco. Since then, Apple’s “revolutionary and magical product” — originally available in a 4GB, $499 model — has gone on to change the way kids and their parents communicate, how directionally-challenged folks find their way home, and how adults hail a ride from the bar. The technology world, in turn, has reoriented around the iPhone, supplanting the personal computer, MP3 players, the digital camera, and maps. In just 12 years, more than half of the world’s population owns a smartphone. Isn’t that great. But what have you done for the iWorld lately?

Jobs claimed the omnipresent “i” prefix that marked the iPhone, and most Apple products since the release of the iMac in 1998, was a lower-case reference to the Internet

Astonishingly enough, it’s being said lately that the era of smartphone supremacy is starting to wane. While we know that past performance is no guarantee of future results, history’s a pretty good indicator, and it’s reasonable to infer that America’s favorite handheld device might be destined to take up residence with the pager, the digital camera, the Walkman, and the Palm Pilot. It’s hard to imagine here in 2019 that the iPhone is ever going away, but it’s easy to see that its grip on the consumer is weakening. Fact is, smartphones simply aren’t the smartest iGuys in the room anymore.

More than a third of consumers look at their smartphones within five minutes of waking up and about 20% check their phone more than 50 times a day

Indeed, functions are virtually flying off the smartphone’s home screen and onto other products with their own embedded smart connections. Wristwatches can now text emojis. Televisions can talk and listen. Voice-activated speakers can turn up the heat in your house 765 miles away. With the number of connected devices that can stream music, clock mileage, or download apps having  doubled over the past three years, the smartphone’s status as the device that businesses absolutely need to reach mobile users has been diminished. “Smart,” it’s being said, is increasingly iEverywhere.

The iPhone by itself outsells 96% of the companies on the Fortune 500

While the iPhone still remains the envy of consumer-product companies around the world, Apple and its competitors are, of a sudden it seems, engaged in a race toward the iBottom. Along with Samsung, the smartphone industry’s other big gun, Apple is at real risk of seeing its high-end phones becoming commoditized. Quietly, Chinese imitators like Huawei and Xiaomi are proving altogether capable of making similar devices at lower prices. The iPhone, meanwhile, represents 60% of Apple’s revenue.

Chinese vendors now make the majority of the world’s phones — crossing that threshold for the first time last year

For the better part of the 2000s, Apple was the master of the next big thing. Not always the first, but always the coolest: the iPod, the MacBook Air, the iPad, the iPhone. In the larger scheme of things, it could be said that the company’s line of Mac products was Apple’s first big trick. The so-called i-Series was its second. At this reckoning, is there a third? We’d feel a lot better if a smart guy in jeans and a black mock turtleneck was here to answer.

What the numbers are saying…

  • $7.2 billion.

The amount investors put into bond funds during the week ended Jan. 9, the largest total in 39 weeks.

 

What folks who aren’t sure about Santa Claus are saying…

“The holiday season began strong, particularly during Black Friday and the following Cyber Week, but weakened in the mid-December period.”

  • Jeff Gennette, Macy’s Chief Executive

“The rising tide of retail sales hasn’t floated all boats. We are seeing a polarization between winners and losers.”

  • Neil Saunders, managing director of research firm GlobalData.

“The traditional department stores’ days are numbered unless they change radically. If you can’t succeed in an environment like this, a strong economy, it’s a problem.”

  • Craig Johnson, president of Customer Growth Partners, a retail research and consulting firm

What the facts are saying…

  • The S&P 500, 10-year U.S. Treasury yield, and U.S. crude oil have moved in the same direction in six consecutive sessions, the longest streak since June.
  • Utility shares in the S&P 500 are the only group of the 11 sectors with losses so far this month. 
  • No U.S. company rated below investment grade issued bonds between the end of November and last Wednesday, the longest stretch without a high-yield sale in data going back to 1995.
  • About 47% of S&P 500 stocks outperformed the benchmark during 2018, slightly below the long-term average of 48%. Just 43% of stocks outperformed in 2017.

What folks with an ear to the Street are saying…

“Retailers that have had the capacity to invest heavily in updating stores and building out their digital operations have been able to pull ahead. Those that didn’t are falling farther behind.”

  • Heard on the Street columnist Elizabeth Winkler

 

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