Apple risks becoming the iPhone company

Apple has a diverse product line. For now.

Apple's products can be summarized as:

• phones (iPhone and Apple Watch)
• tablets (iPad and iPod)
• laptops (MacBook and MacBook Pro)
• desktops (iMac)
• accessories
• streaming services

I'm not quite sure where the Apple Watch fits in this list. I group it with the iPhone, since it is usable only with an iPhone.

Close examination of this grouping, and Apple's financial results, shows that it makes the bulk of its profits from iPhones (and Apple Watch products). Sales of iPads have plateaued and may be declining. (The re-introduction of the iPod may be a result of that decline.) Laptops are selling well.

The other groups (desktops, accessories, and steaming services) count for little. (Accessories counts for little because without the base product line, accessories are not necessary.)

Apple's desktop line is of little consequence. The products are vanity products, present because Apple can make them. The waste-basket iMac looks nice and has lots of processing power, and while I know many people who would like one I know precious few people who have actually bought one.

So the two big product groups are phones and laptops. And as I see it, laptops are at risk.

Apple's MacBooks and MacBook Pros are popular. Developers use them. Individuals who are not developers use them. Startup businesses use them. (Established businesses not so much.) Yet their use, at least among developers, makes little sense. More and more, I see them used (by developers and startup businesses) as access points to servers. MacBooks are not used as development tools but as smart terminals (*very* smart terminals) to the servers with development tools.

The problem for Apple is that competing tools can be had for less. Apple has always charged a premium for its products, but the competition is now significantly less. A Windows-based laptop can be had for half the price of a MacBook, and a Chromebook for less than one quarter of the price. Windows and ChromeOS run browsers and ssh just as well as Mac OS, and developers know it.

Developers are not the only ones shifting to the "PC as a terminal" model. Businesses are using virtual desktops and terminal sessions for many of their systems. They, too, can count.

When MacBooks lose their appeal, Apple will lose a chunk of business, but more importantly, its business will become less diverse. Should that happen, Apple may focus more on its profitable line (iPhones) and reduce development of other lines. Just as Apple let its desktop line wither into a vanity high-end product, it may do the same for laptops.