By Jeremy Olshan
Today millions of seemingly rational people fished a fully functional iPhone from their pockets and contemplated hurling the device out the window. I know, because I am one of them.
Like many, I committed to the iPhone 5 upgrade even before Apple CEO Tim Cook unveiled the new device with the usual burlesque slideshow presentation. It’s not that I have any major complaints with my iPhone 4S — sure, it occasionally freezes up and the battery doesn’t always make it through the day, but it’s probably the best piece of technology I’ve ever owned. Nor do I think the thinner, faster, bigger-screened and brushed aluminum iPhone 5 will do a substantially better job of delivering email, locating restaurants, playing music, or distracting my four-year-olds at restaurants with unusually slow service. But I want it anyway.
This isn’t like me. I tend to drive cars into the ground, my laptop is an ancient three years old, my Nikon camera is five years old, and my toaster is at least seven. In fact, last week when Amazon CEO Jeff Bezos showed off his new line of e-readers, I felt no similar urge to ditch my nearly two-year-old Kindle, perhaps my second favorite gadget.
On this I’m not alone, by the way: Just one in six e-reader owners will upgrade this year, versus one in two smartphone owners, estimates Neil Mawston of Strategy Analytics. “Smartphones are more fashion-oriented than e-readers, so they are perceived to age faster and get replaced sooner,” he says. In other words: The iPhone is sexy and multi-talented. The Kindle is a screwdriver.
Apple counts on sheep like me. In the first month after the iPhone 4S was released, 70% of the buyers already owned an iPhone, according to a study by Michael Levin of Consumer Intelligence Research Partners. After the initial hoopla, that number dropped to 35%, he says. “But given the reports about how many people waited to buy the iPhone 5, we’d expect history to repeat itself here,”says Levin.
In a way, Apple managed to put into effect an idea espoused 80 years ago by real estate broker and amateur philosopher Bernard London in a famous paper titled “Ending the Depression Through Planned Obsolescence.” London’s zany idea was to fuel the economy by limiting how long one could legally own a toaster or radio. “I propose that when a person continues to possess and use old clothing, automobiles, and buildings after they have passed their obsolescence date, as determined at the time they were created, he should be taxed for use of what is legally ‘dead.’”
Apple didn’t need government intervention, however. Due to the way iPhones are subsidized by the wireless carriers, it may be crazy not to upgrade. On a resale site, I locked in a price of $251 for my iPhone 4S. This means, that by upgrading to the new $199 model and paying the various upgrade fees, I may even make money on the deal.