A wall plug doesn’t come with your new iPhone 12 box.
Yes, it is annoying. And yes, that means that to allow faster charging, you’ll need to spend $19 on a plug that fits with the new form of cable that comes with the iPhone 12. (Don’t worry, you can still keep the plug and charging cord of your old iPhone and it’ll work with the new iPhone 12).
Despite Apple’s argument that the exclusion of the plug was a pro-environment move, the premium brand is on track to see an increase in its hardware accessories and wearables segment thanks to the selling of the plugs and the new ecosystem it is building around the MagSafe charging system of the iPhone 12.
Apple introduced a MagSafe charger alongside the new iPhone 12 models, that attaches to the back of the iPhones using magnets embedded both in the charger and in the iPhone. It allows for speedier charging and paves the way for a portless iPhone in the future.
Promising growth has already been demonstrated by this segment, which includes products such as the Apple Watch, AirPods, chargers and other accessories. In Apple’s fiscal third quarter, sales soared nearly 17 percent to $6.45 billion. On October 29, Apple is expected to announce its fourth quarter fiscal performance, but this will not reflect sales of the iPhone 12 and related items that went on sale recently.
Accessories and wearables are following a similar story we’ve seen with Apple’s services business, which includes digital products like streaming music and iCloud storage. With iPhone sales no longer showing growth, Apple has come up with new digital products to leverage more out of its user base which includes 1 billion iPhone users. Apple generated $13.16 billion in services revenue for the fiscal third quarter, up nearly 15% from the year before.
Apple is set to see a big increase in accessory sales this quarter between the missing plug ($19), missing wired earphones (wireless AirPods start at $159) and the new MagSafe charger ($39) for the iPhone 12. On top of that, Apple has a new $99 HomePod speaker version that goes on sale next month while the Apple Watch is cheaper than ever at just $199.
Analysts have already picked up on this potential for growth.
“While [Apple] claims that they are not shipping earphones and a charging cube with the iPhone to save the environment (they are including a charging cord), the reality is that such a decision could drive a financial benefit for the company as well,” they said.
Looking beyond the near-term sales of the iPhone 12, the latest magnetic charging device from Apple, MagSafe, lays the groundwork for even more iPhone accessories. There have long been reports that the ultimate aim of Apple is to eliminate the iPhone charging port, as it did with the regular headphone jack, which in turn would drive iPhone owners to purchase even more extras with their devices.
Maybe Apple is genuine when it says it’s good for the environment to eliminate regular accessories from the iPhone box. When you ship tens of millions of iPhones with fewer packaging and plastic, there would definitely be a positive effect on the environment. But it also pushes iPhone consumers to purchase more high-margin Apple extras, so they can get the most out of their iPhone. And that revenue keeps growing.
