The iPhone 3G S Defies Recessionary Economics?

More

Saturday, upon seeing the line outside my neighborhood Apple Store, I knew something must be up. The new iPhone 3G S was on sale. The Washington Post reports good news:

Evidently, a faster iPhone is enough to get consumers to reach for their wallets again. Apple announced yesterday that it sold 1 million units of its latest iPhone over the weekend.

The article celebrates the fact that apparently nothing can stand in the way of the iPhone, not even a deep recession. I have a few observations that might dampen the news a bit.

First, despite the sales numbers exceeding expectations, it's ridiculous to think that the recession had no effect on sales. With unemployment probably approaching 10% at this point in June, there's a large portion of the market that probably couldn't splurge on a luxury item like an iPhone since they were jobless. But maybe I'm wrong: can't you just see people cashing their unemployment checks and running to the Apple Store, crisp cash in hand? If we were not in such a bad recession, I would imagine that the sales would be even higher. Maybe they would have sold 2 or 3 million units.

Second, Apple has a cult following. Some consumers out there are so enamored with Apple products like the iPhone that they would practically spend the last penny in their bank account to ensure they have the latest, most beautifully designed piece of Apple technology. Maybe that's an exaggeration, but they'd certainly make a purchase in a recession. They'd also buy it as soon as possible -- like in the first weekend it's out. Subsequent sales numbers might not hold up for as long as last year's release once the non-obsessed public started buying.

Third, I wonder how the iPhone will fare without Steve Jobs. As Megan noted yesterday, Apple lovers are hoping and praying he pulls through his health problems. Yet, with such strong sales of a new model with little additional innovation, some might say that the iPhone is on cruise control. The only really significant change between this and the prior iPhone model released a year ago is speed. That's why, despite being something an unabashed iPhonophile, I didn't jump at shelling out $300 for the new model. Of course, the hand of Steve Jobs was crucial in the original concept, so I'll be surprised if investors take the good news of first weekend iPhone sales to overshadow the bad news of his health.

Jump to comments
Presented by

Daniel Indiviglio was an associate editor at The Atlantic from 2009 through 2011. He is now the Washington, D.C.-based columnist for Reuters Breakingviews. He is also a 2011 Robert Novak Journalism Fellow through the Phillips Foundation. More

Indiviglio has also written for Forbes. Prior to becoming a journalist, he spent several years working as an investment banker and a consultant.
Get Today's Top Stories in Your Inbox (preview)

The Ghost Trains of America

Can a band of locomotive experts save vintage railcars from ruin?


Elsewhere on the web

Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register. blog comments powered by Disqus

Video

Why Did I Study Physics?

Using hand-drawn cartoons to explain an academic passion

Video

What If Emoji Lived Among Us?

A whimsical ad imagines what life would be like if emoji were real.

Video

Living Alone on a Sailboat

"If you think I'm a dirtbag, then you don't understand the lifestyle."

Video

How Is Social Media Changing Journalism?

How new platforms are transforming radio, TV, print, and digital

Video

The Place Where Silent Movies Sing

How an antique, wind-powered pipe organ brings films to life

Feature

The Future of Iced Coffee

Are artisan businesses like Blue Bottle doomed to fail when they go mainstream?

Writers

Up
Down

More in Business

Just In