iPhones are priced ‘high in the extreme’ but they’re worth it, says Apple co-founder Wozniak

Chinese smartphones are overtaking Apple because they offer functionality at affordable prices, says one of the pioneers of the personal computer industry

PUBLISHED : Wednesday, 19 July, 2017, 7:14pm
UPDATED : Thursday, 20 July, 2017, 9:35am

Apple’s iPhone has been losing ground to domestic competitors in China.

That is because Chinese smartphone makers offer sophisticated functions at reasonable prices, according to Steve Wozniak, Apple co-founder and one of the pioneers of the personal computer industry.

“Here is what I admire about Chinese phones: really good, intelligent decisions about how to lower the cost but keep enough of the functionality in, because I am into products that are good, well designed, nice looking, but at prices that the average person can afford,” he said.

Apple’s revenues in China fell 14 per cent year-on-year to US$10.7 billion in the first quarter, or 34 per cent on a quarterly basis, although chief executive Tim Cook reaffirmed his confidence about opportunities in the world’s largest smartphone market.

IDC data showed that Apple shipped 9.6 million iPhones in China in the first three months this year, down 26.7 per cent from the same period in 2016. Apple, currently the fourth largest smartphone vendor in China after Huawei, Oppo and Vivo, has seen its market share in the country slip to 9.2 per cent in the first quarter this year from 12.7 per cent in the same period last year.

Still, Wozniak believes the quality of Apple’s product makes it worth the high price tag.

“In life I don’t believe in quantity as much as I do in quality. So you may not have the hugest share in the market or be the No 1, but you should have the best product you can possibly build and Apple qualifies for that,” Wozniak, told reporters after he discussed artificial intelligence with Liu Zihong, chairman and chief executive of Royole, in a technology forum held at Tianan Cyber Park in Dongguan, Guangdong province, on Tuesday.

Unlike Chinese smartphone brands that prioritise cost-effectiveness, Apple’s popular and more expensive iPhone handsets are still the leader in innovation in certain features despite being more of a “safe product”, he said.

“Apple products are safe. And Apple’s pricing is high in the extreme. It’s a safe bet for a lot of people, and when you love Apple you are willing to pay for it,” he said.

“But Apple is not falling behind [in terms of features] at all. You can’t be No 1 at everything when you make a huge volume, tens of millions of a product. You cannot make the best product you possibly could. You have to figure out the manufacturing steps to make something reliably in those quantities.” Wozniak developed the Apple I computer in 1976, when he co-founded the company with Steve Jobs.

Responding to the US company’s downward sales momentum in the mainland, where a number of Chinese brands are rising to compete for market share, Wozniak said local brands “like Xiaomi and Huawei have been around for a long time and they create great products”, adding that Android smartphones have for a long time been approaching the same level as iPhones.

As a technologist, Wozniak said he also buys a lot of Android phones to explore and experiment with them. But he admitted he has never bought a Chinese phone, though he has been given them in the past. “Sometimes there were reasons that they didn’t work for me, and Russian phones as well,” he said.

Unlike some smartphone companies that have won credit by simply improving the camera on their phones, Apple is still making major steps in the industry. It was the first company to popularise touch ID that recognises a human finger print instead of typing a password – a huge step that every other phone company is now trying to emulate, said Wozniak.

But he conceded that Apple is behind Chinese rivals in certain features, such as the easy transfer of money on social media apps like WeChat.