Newsletter writer helps explain why the iPhone is struggling in China.
Professionals used to have their place in the world and rarely strayed from it. Analysts analyzed, investors invested, executives operated, and journalists reported.
Now you have people like Ben Thompson, the American proprietor of the newsletter Stratechery, who happens to live in Taiwan. Thompson is one of the keenest observers of the tech scene, having previously worked at Apple, Microsoft, and the online publishing software company Automattic, creator of WordPress. His academic background says a lot about his range and why techies of all stripes devour his writing: He studied political science as an undergraduate, picked up a masters in “design and innovation,” and then became an MBA. He’s a triple threat, in other words, as an observer and analyst. He’s a clean writer too—no mean feat.
I write all this to clue you in, if you aren’t already, to his “freemium” product, which includes one outstanding free piece per week plus more you’ve got to pay for. He regularly sets Silicon Valley abuzz with his widely circulated free articles, like the one he wrote last week about Apple’s “China problem.”
I encourage you to read the whole thing to see how Thompson’s fertile mind works. But I’ll give you one spoiler here: The “problem” of which he writes actually comes in the form of praising Apple with faint damnation. Apple’s iPhone sales are slipping in China, you see. Thompson believes that while Chinese phone buyers are as besotted by the iPhone as a status symbol as the rest of the world, what’s most important in China is the messaging and payment and game-playing service WeChat. (WeChat, incidentally, is part of the Chinese Internet behemoth Tencent that’s worth nearly $300 billion; Curiously, Thompson doesn’t once mention Tencent.) In Thompson’s estimation, WeChat matters more in China than Apple’s software platform iOS and also more than Apple’s gorgeous hardware.
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What about the faint damnation part? Thompson isn’t sure Apple is finished in China, despite its decline. “To be sure,” he writes, like any good journalist, “an iPhone is still status-conferring: Apple is by no means doomed, and it’s possible those China numbers will turn positive this fall.” But, he concludes, the “lock-in” it enjoys elsewhere in the world appears to be more tenuous in China.
Here in the U.S. we call that a success problem.