Horace Dediu

Or, why do cameras have phones?

In a retrospective on the iPhone Uno, I noted that the iPhone was launched with three "tentpoles:" a widescreen iPod, a Phone and an Internet Communicator. Effectively, a music player, telephone, and browser. All in one device. This positioning in 2007 bundled what were considered to be individual products: an iPod, a Phone and a laptop. By bundling these, value would be created in not having to select which you would take with you at any given time. You would have all three with you always.

I then noted that none of these tentpoles were the most popular uses for the product today.

Social media and entertainment are by far the most popular, followed by utiliy/productivity and finally gaming to round out the top four uses. You can check your own usage patterns using the Settings app on your iPhone.

By checking Pickups you can also see the time division of usage. On average, smartphones are used in a log-normal distribution with the most common time being less than 2 minutes. The number of pick-ups and their distributions add up to almost four hours of use per day.

Based on this analysis, it would seem that the iPhone developed in ways unforeseen by its creators. Most of these activities did not exist on phones at all. There were games and there were messages and perhaps a bit of email but phones were mostly used for phone calls. Today, phone use does not usually show up in the top 10 activities.

The lesson is that truly transformative products create their own demand and their own use cases. You must be humble in your assumption of how buyers will use the product and also provide a platform for new use cases to be created by third parties. Apple did not create social media apps or games or YouTube for the iPhone. It enabled them.

But one thing missing from this analysis is the camera. Whereas Apple invested in development of a better screen and processor and storage and services to support the apps to became the "killer" apps, it disproportionately invested in the camera.

Consider the latest iPhone 18 Pro. The cameras are the most prominent design element, shown in all photos of the product. The obverse of the camera view has no distinguishing feature. Cameras are featured as the primary differentiation of the product in advertising. "The ultimate performance and camera of any iPhone." The tentpoles of the iPhone 18 Pro are: 48MP, variable aperture, f 1.48 lenses. The copy reads: "48MP Fusion Main camera with variable aperture. Improved low-light photos and video. Impressive depth of field."

The latest cameras on the iPhone make it beyond good enough for professional use. It is very capable as the only camera a video or still photographer would need to earn a living. For the consumer it seems to over-serve by a mile.

But the camera is not what appears in the usage logs and is in a different world from the original tentpoles.

So why does the iPhone have a pro camera? Why is photography even something to consider in a phone.

When we look back, the idea of a phone with a camera was only put on the market in 19991. First seen in Japan, it was popularized by Nokia and by the time the iPhone launched it was already considered normal to have camera in a phone. It was no longer a "camera phone" but just a phone.

By 2007 disruption of traditional cameras was already underway. Digital photography moved quickly to displace analog or film photography. Point-and-shoot cameras quickly overtook every category and DSLRs had been booming. However, phones with cameras quickly overtook all others and the number of photos taken by them exploded by multiple orders of magnitude. Use in messaging, cloud storage and then social media itself came to embody photography.

New social media emerged around photos: Snapchat, TikTok, YouTube and Instagram were image-first social media while Facebook came to embody it. Now it's hard to see any social media content which is text only.

In that way, the social media category became an "imaging" category. The camera's improvements were social media improvements.

Today's pro cameras are used to allow amateurs to appear pro in their posts. The value is in allowing a billion people to become both models and fashion photographers. Vanity is a bigger business than productivity.

But throughout this period Apple was not valued for being a vanity enabler. Its products and users were measured with dollars and gigabytes. Even today there is no "vanity market share" for iOS or Android. The contrast between what we measure and what people buy could not be greater.

It behooves the investor to understand this.

Jobs to be done theory helps explain what is happening. The jobs buyers hire phones for are very numerous. It's not one thing, it's many. So many that we cannot enumerate them. A common theme that runs through the data however is that the iPhone is an indispensable social construct. It is, for better or worse, the medium for communication and that embodies all human frailty.

The segmentation by the seven deadly sins holds.

This is not a biblical construct. The fourth-century monk Evagrius Ponticus (pictured above) reduced the forms of temptation to eight (in Greek), Evagrius's list was translated into the Latin of Western Christianity in writings of John Cassian, one of Evagrius’s students; the list thus became part of the Western tradition as follows:

Avaritia (greed, avarice)
Tristitia (sorrow, despondency)
Ira (wrath)
Acedia (sloth)
Vanagloria (vanity)
Superbia (pride)

Most of the activities on Social Media fall into these categories and Vanity and Pride clearly are enabled by the cameras.

The value of each of the "sins" or perhaps more euphemistically "temptations" is missing but I'd venture to guess that Vanity and Pride are worth at least $1 trillion in market capitalization.

1. The first commercial camera phone was the Kyocera Visual Phone VP-210, released in Japan in May 1999

Disrupting the disruptor. The Curse of Cassandra strikes again.

Netflix stock has "a growing YouTube problem," a Wall Street analyst says. Alphabet's YouTube is taking increasing viewer share.

Netflix (NASDAQ:NFLX) shares slipped Tuesday after HSBC downgraded the streaming giant to Hold from Buy and slashed its price target 21%, warning that weakening engagement and intensifying competition from YouTube could make a near-term recovery harder to deliver. Analyst Mohammed Khallouf cut his target to $76 from $96, leaving only about 3% upside from current levels and putting renewed focus on whether Netflix can defend viewing time without materially increasing content costs.

Netflix stock fell more than 1% at Tuesday's open following the downgrade.

HSBC's central concern is engagement. Khallouf said near-term recovery in engagement looks unlikely, citing a declining reception for Netflix original content and the growing share of television viewing captured by YouTube.

That competitive pressure is increasingly visible in the numbers. YouTube reached a record 14.2% share of U.S. television viewing in July, while Netflix accounted for 7.8%, according to data cited by HSBC. Netflix's own engagement metrics also weakened: viewing hours for English-language programs appearing on its weekly Top 10 lists declined roughly 17% year over year across July and August.

"YouTube has been benefiting, in our view, from a declining reception to Netflix's original content," Khallouf said in a client note. "Near-term recovery in engagement looks unlikely."

Netflix has shifted more into YouTube's space with video podcasts, sports and other content.

"YouTube has been rapidly expanding its living room footprint, having captured a record 14.2% share of U.S. TV time this July," Khallouf said. "This momentum is increasingly coming at the direct expense of Netflix as its share fell to a multiyear low of 7.8%."

Netflix Stock Cut To Sell Rating

Meanwhile, rival Apple's (AAPL) Apple TV+ subscription service is riding high after dominating the Primetime Emmy Awards last week with 29 wins for critically acclaimed shows such as "Widow's Bay," "Pluribus" and "Slow Horses." Netflix scored 16 Emmy Awards.

On Friday, Wells Fargo analyst Steven Cahall lowered his rating on Netflix stock to underweight, or sell, from equal weight, or neutral. He also slashed his price target to 57 from 80.

"Engagement trends look worrying to us," Cahall said in a report. He also noted competition with YouTube.

Source: Investor's Business Daily

NB: You wait years and years for the obvious to happen. So long that you give up. Then it happens.

YouTube was the writing on the wall for all forms of TV. That much was clear more than a decade ago. So long ago that I forgot all that I wrote and thought about it. You just move on to other things, like transportation. This was in 2014.

In the meantime the trajectory takes its parabolic course. You just don't know where the peak is. We may have reached that peak, finally.

The power of YouTube was always there, the numbers have been compounding for years.

Personally, I never subscribed to Netflix, leaping directly to YouTube long ago. It may not appear comparable, but the jobs are the same: fill downtime with content that's easy to digest. Initially not good enough but good enough soon enough and more than good enough eventually.

The Curse of Cassandra strikes again.

But what about Apple?

The article notes that Apple keeps piling on the awards. What seems to be happening is that Apple saw the disruption and decided to fly well above it. The premise of Apple TV+ is that it's a provider of content of the highest, award-winning level only.

This may be eventually matched by YouTube but perhaps not. The production quality has no monetization equivalence in YouTube. The marginal dollar spent on quality has no return beyond a certain point. At least that's the calculus.

The best shows will just be on Apple TV. For everything else you can use YouTube.

This assumes that there are people who will seek out quality. That they are not ever going to just settle for filler and junk and ads and short-twitch triggers. The market bifurcation into "super premium" and "slop" follows the 80:20 rule.

Sounds familiar.

 

 

An Office Hours question, September 11, 2026.

Q: Aside from the iPhone Pro & Duo, what was significant with Apple's latest?

We've had a lot of betas since WWDC, leading to OS 27. That'll be big. People overall have been giving good reviews. It is much better than many people expected.

But the big news of the event, to me, was the Watch, health in general, and how it's going to end up leveraging AI. That is one of those things that keeps compounding.

The story of health and Apple continues to be a drumroll that gets bigger and louder, and it's still getting ignored. It's getting ignored the way services were ignored ten years ago, when Wall Street didn't think it was worth paying attention to. It was a hobby. Even the most famous followers of Apple would have said Apple's no good at services, that it was Google's game, that Apple was too slow, bad at building data centers. No one's saying that now.

Tim has a lot of quotes, but the one I like most is where he said that Apple may be known most for its contribution to health. That's a bold claim, and it flew over people's heads. But think about it: would I rather have a device that keeps me healthy? Not just fixes me, but keeps me healthy. That's health maintenance. As a coach, it does all the things that lead to a good lifestyle, and maybe not just health but happiness. What would be the value of that machine versus one that was an AI? We focus entirely on AI being some kind of magic, whereas health is another kind of magic that doesn't seem to be considered very valuable. If I were to do the math, the health industry, including wellness, exercise, apparel and diet, is far bigger than knowledge-based assistance.

Now, I'm not discounting AI at all. But people are more likely to say: we want to preserve and be healthy. There are big problems with that, in motivation and so on. We like GLP-1s because we like pills. Simple answers, quick, but expensive. Doctors like them because they're easy to prescribe. You don't have to rely on the habits or the mind of the patient.

But what if you could change people's behaviors? What if you had a machine that was effective in guidance, without the side effects?

The case in point is exercise. If exercise were a pill, it would be a miracle pill. Every doctor would prescribe it. So the question to ask is: how do I make exercise into a pill?

Making it into something so reliably delivered and so easily administered: whoever does this will reap enormous rewards. That's where I think Apple is thinking they'll be in twenty years.

We're seeing continuous progress, always flying under the radar, everyone glazing over: more sensors under the Watch, what's the big deal. But that Watch is collecting so much data. I'm shocked, scrolling through my Health app, at how many different things it's able to infer. It's now tracking your heart rate at five-second increments, as close to real time as possible. What about blood pressure? Glucose? Your hearing, your eyesight? And then the biggest things of all: exercise and diet. Apple will eventually conquer these domains, and then it'll be a thing you have that's as important as an AI assistant. How about my health coach?

They just did an acquisition of a company using electromagnetic fields for what I first read as intent sensing but now think is biosensing: possibly determining blood sugar or other metrics of your health. It's not going to be neural implants, but they're going to get all this data. This is a moonshot. This is the human moonshot. It's solving something bigger than AI, in my opinion.

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One of the questions asked in Asymco Office Hours. The full recording and transcript are available to Asymco One subscribers.

Apple sold 1.2 million Macs in China for 10% market share in the second quarter of 2026. That compares to sales of 700,000 Macs and 7% market share in the second quarter of 2025. That’s annual growth of 63%.

For full-year 2026, Omdia expects mainland China’s PC market to decline 6% YoY, with consumer shipments falling 10%. Meanwhile, the tablet market is forecast to contract 10% in 2026, reflecting weak demand and continued supply constraints.

Source: Apple World Today [my emphasis]

NB: This is a few months ago and baked into the results already posted (29% revenue growth for the Mac segment).

The refrain of growth while the market contracts repeats across all products and all regions and predates the product launch cycle that began in September. It's quite extraordinary.

I estimate China made up about 16% of all Mac sales and there is plenty of room to grow.

 

It's an anomaly. Pay attention to anomalies.

In a new interview, Clique TV’s Mouloud Achour asked Ternus: “The Vision Pro: for you is it a test, a flop, or the first step to the future of what’s going to be…a computer?”

Here’s what Ternus said:

"Vision Pro to me is an amazing device. It’s an absolutely amazing device. But I think of it as like the early days of computers. It is the early days of a long journey. That’s how I feel about Vision Pro. What you see, if you think about the early days, people found different reasons where the computer allowed them, the Mac allowed them to do something never before possible. Like desktop publishing, and it became a big thing in that industry.

What you’re seeing with Vision Pro now is, certainly there’s early adopters who love it and they’re using it and they’re enjoying it, but you also—surgeons are starting to use it in surgery because it’s just a fundamentally better tool for them than a monitor that’s kind of sitting over here. And so it’s growing in that area. In film production people are using it for set development and things like that. So we’re going to continue to grow and find more and more compelling use cases. And I think there’s a very bright future."

Source: 9to5Mac

NB: Tim Cook launched and supported the Vision Pro while…

… many said it should cancelled due to poor sales. I argued recently that it's an anomaly. A phenomenon that has no explanation using the theories we currently have. When an anomaly emerges it should be studied carefully because either it refutes our theories or it enhances them by refining them.

Apple's interest in this category of visual computing (or spatial computing, as Apple calls it) is deeply seated. Apple exists at the intersection of humans and computers and the visual representation of information is the most compelling and highest bandwidth way of interacting with machines. We are fundamentally vision-based lifeforms and interfaces that maximize stimulation of the visual cortex are most likely to be adopted. For a simple demonstration of this one can simply ask about the physiology of reading and why we have binocular vision and how cave paintings came so early in our history.

The interest in this product is not for its revenue potential but for its guidance into how we will connect with and through machines. The learning required perhaps cannot be obtained entirely in a laboratory.

 

 

The Asymmetric Weekly, for the week ending Sunday, Sept 20th.

Research

The Dawn of Gestural Computing

The more one one thinks about the iPhone Duo the more the Duo branding appears to be signifying something beyond two screens. Perhaps Duo is marking iPhone 2.0, a new epoch in the history of Apple devices. Consider that the premise of folding the screen isn't just to afford a larger surface, but physically transforming to form factors of a book, a mini laptop, a notebook (with Pencil!), a tablet, an alarm clock, a movie screen... →

Duo dollars a day, Duo cents an unlock

The Duo's price range is $2000-$3200. How should we think about this? →

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Nota Bene

The iPhone Duo: pathos, not specs

One theme about the iPhone Duo seems underreported: pleasure, prestige, the pride of ownership. It's always been there with Apple products, but being the first to get a foldable, after everyone's been talking about it for so long, might be a bigger driver than the practical aspects. →

Stairway to the $3200 Heaven

The top price in the iPhone Stairway to Heaven chart is now $3,200. How does this affect iPhone ASP? →

What happens when smartphones become too good? → Katharine Sorensen of The Beiruter interviewed me on the shuttle bus to Apple’s September event, two days before the Duo existed. Her question was the more profound one: what happens when phones are good enough, when replacement cycles stretch to four years and the installed base grows regardless. The industry has spent its history persuading people the device in their pocket could be substantially better. Apple’s answer arrived that Wednesday with a hinge. →

Siri, not a companion, by design. → People have gotten used to AIs being wrong, so folding intelligence into the OS adds little brand risk as long as the experience is as expected. The product manager for Apple Intelligence told me Siri is built not to be a companion: an advisor and a concierge with a professional persona that keeps its emotional distance. The exposure Apple actually guards against is not hallucination but a violation of privacy or security, where a single leak brings lawsuits and regulators at once. Managing that risk is the cost of doing business. →

Refurbishing the Innovator’s Dilemma → Apple already sells refurbs, but at small scale, and refurbishment is a scale game. Lease returns change that: one and two year old phones taken back in volume, refurbished and resold at minimal profit, because the point is not profit but visibility into a secondary market Apple otherwise has to sample. The lowest priced new iPhone is now in the $800s, and the $400 slot belongs to the used market, just as only 12% of Americans can now afford a new car and the auto industry has dehydrated itself of visibility into everyone else. My advice to Apple is to not fall into the innovator’s dilemma: more profitability is not always the right answer. →

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Live Events

Asymco Office Hours Duo: The First Ternus Keynote – Sunnyvale Session Recording & Transcript, September 11, 2026 → Recording and transcript of the Sunnyvale session, held two days after Apple’s September event and the first keynote under John Ternus. Inside: the Duo as a pricing decision made seven years ago, the attraction of moving objects, two cents an unlock, the 1.2 billion puzzle of the iPhone ASP, why launch the iPhone 18 in spring, Siri designed not to be a companion, Apple’s unpretentious moonshot, and what follows the memory famine. Full recording and transcript for Asymco One subscribers. →

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Feedback: Have questions or comments? Reach out to us at contact@asymco.com. We’d love to hear from you.

An Office Hours question asked by Fred S., September 11, 2026.

Q: Will Apple follow what carmakers have done with certified pre-owned, taking the phones returned through Apple Upgrade, putting them in a nice package and selling them?

They do, on the Apple Store, but at small scale, and refurbishment is a scale game. Today the refurbs come from the refund policy: someone returns a phone a month later that they barely used, and Apple resells it, almost new, at a slight discount. What you're referring to is lease returns, one- to two-year-old phones. They will probably take those in huge numbers, refurbish them in a very high-volume facility, and pump them back out at minimal profit. I don't think it's about profit. I think it's about knowledge of the market. Once a phone goes into the secondary market, Apple doesn't know much about it or what pricing people are getting; they have to sample it. Leased products that return to Apple are under their control and visibility. That information is super important. The lowest-priced new iPhone is now in the 800s. It used to be 400. That slot is now taken by the used market.

The auto market is the key question, because there are four used cars sold for every new car. The used market is now becoming the primary market, because cars are so expensive. Only twelve percent of Americans today can afford a new car. It used to be sixty or seventy percent. Prices have exploded, so one in six Americans are buying new cars, and that determines why the cars we find available are all enormous SUVs: that 12% is the wealthiest 12%, and they're saying no to economy cars.

This is a very important observation, because a lot of classical disruption theory depends on the low end and the mass market being interested in good enough. The problem is that the auto industry has completely dehydrated itself of visibility into that market. The challenge for Apple is not to fall into the trap of making things for the rich few, and yet not compromise on quality. If there's one thing I would advise Apple on, it's not to fall into the innovator's dilemma. It's a trap to think that more profitability is always the right answer. Apple being a premium brand, people already assume it's an exclusive, frivolous type of product, but they're not thinking fully about what's going on there.

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One of the questions asked in Asymco Office Hours. The full recording and transcript are available to Asymco One subscribers.

See the proceedings at asymco.com/live.

Today · 4:00–5:30pm ET / 1:00–2:30pm PT · Boston Seaport, and online

The second half of the Asymco Office Hours Duo took place on Friday, September 18. See the proceedings at asymco.com/live.

In person: Boston Seaport. 4:00-5:30.
Hang out with Horace & Co afterward at Asymco Happy Hours.

Remote: Join online.

Register: In Person

Register: Remote

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Venue details and the remote join link will be posted to registrants. Asymco One subscribers are guaranteed seats, may bring a guest, and may participate in the live Q&A.

The session will be recorded; recording and transcript will be posted at asymco.com/live shortly after to Asymco One subscribers.

An Office Hours question, September 11, 2026.

Q: The Stairway to Heaven now tops out at $3,200. That's a very high price at presumably low volume. How does it affect your thinking about the average selling price?

If you look at the price increases as a percentage from the previous generation, there's a range. They're not the same. Obviously, if you're going from 256 gigabytes to 512, that's double, 1024 is quadruple, and then eight times, so you should see bigger jumps. Indeed, if you divide by the capacity, there's some consistency, between 20 and 30 cents per gigabyte of additional cost. But some configurations are getting a kind of bonus, in the sense that their increases are lower, as low as 8%. That configuration is the 512 gigabyte, and the reason it got a break is probably because it's the most common one. So there's a higher increase at 256, it dips at 512, and then it comes back and is highest at 2048.

My expectation is that the sweet spot is the 512, and if I were to weight the pricing, I would concentrate on that price point as the mode, the most common configuration. It's multiplying way too many assumptions to come up with an exact ASP, but I penciled in an average price increase of around 12%, which is way lower than most people thought. My estimate was 10 to 15, and we came in close to the 10. That's a surprise.

What this does to the ASP depends on what the previous ASP was, and that is never given by Apple. People are saying it's already at 1,200, or 1,100. I've been much more conservative. I thought it was about 900, and therefore now we're at a thousand, perhaps. The reason I believe it's lower than what the mainstream is saying is that I can't reconcile the fact that there are 1.2 billion iPhones in use and only 200 million are sold a year. If only 200 million are sold a year, and some are to new customers, how do you account for, say, 150 million phones replacing the worn out, broken and obsolete portion of the 1.2 billion? It suggests the lifespan of the product is eight to ten years. That doesn't make sense either, and no one is talking about this. The ASP immediately affects it: if you assume a huge ASP, you're shrinking the volume, which means you're not servicing the installed base.

There are several reasons the ASP is lower than list. When Apple publishes a price, there are retail margins. If they sell direct they get the full price, but through carriers you see the discounts popping up, and some of that is eaten by the distributor. Apple's not getting full MSRP on every deal. And they account for the revenue differently: for compliance with GAAP they cannot book the hardware revenue if software is yet to be delivered, so some is deferred. Over time that evens out, but it distorts the picture.

Why are analysts fixated on the top? Because if you read the Stairway to Heaven, you fixate on the top. Oh, the phones are so expensive. But do you know how few two-terabyte units are sold? You need to be a YouTuber capturing video for hours to need a two-terabyte phone, or so wealthy that you don't question it. That's a vanishingly small number. What people forget is that there's a lot of middle to low end. I was surprised, doing my inventory for the Stairway data, that the 16 is still available for sale, even lower than the 17e, which is considered the low end. There are a lot of good-enough phones down there. So what is the ASP? Excluding the Duo, I think it's gone up to probably 1,100. With the Duo, we're at 1,200. It all depends on how many Duos they sell. And a footnote: Duo sales start in October, so it's not going to make this quarter at all.

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One of the questions asked in Asymco Office Hours. The full recording and transcript are available to Asymco One subscribers.

See the proceedings at asymco.com/live.

An Office Hours question asked by Bob V., September 11, 2026.

Q: When wrong answers came from ChatGPT under the original integration, Apple could say it was ChatGPT's problem. Now AI is integrated into the OS itself. Does that change the risk for Apple?

I suppose. But then again, people have gotten used to AIs being wrong. There have been improvements in performance and quality, but there's an acceptance that the nature of AI is that it's not deterministic, and usually you get a disclaimer saying answers may be wrong. I don't think there's that much brand risk, as long as the experience is as expected. Of course, Siri also had its problems, but it wasn't usually being wrong. It was not understanding, or not getting the question right.

Where it gets dangerous is if you're using these technologies to make decisions that are life-threatening, or if it gives you bad advice, as we see with chat AIs, where people become psychotic as a result of using them. I got a briefing on this from the product manager of Apple Intelligence, and she said: we're building Siri not to be a companion. It was a very big deal. It's an advisor, but not a companion. Siri is there as a concierge, a professional persona. It is not an amiable person, because they want to maintain an emotional distance. That was by design.

It's interesting they made that decision, because it would have been very attractive to create a companion Siri. Years ago, when Siri first came out, Big Bang Theory put Siri as a character in one of the shows: the nerdy characters became emotionally involved with Siri, and it was a cause for comedy. That was more than ten years ago, and I think since then Apple has become very aware of the pitfalls. They're probably conscious of the hallucinations and being careful with that. But the main focus is not on error prevention. It's on preventing violations of privacy or security. It's far more scandalous if they're accused of some sort of leak of information. They'd get sued right away. There was a recent lawsuit claiming a privacy fault, where the exposure came from their own claim. This gets very tricky: regulatory concern, legal liabilities, class actions of all kinds. Managing all that risk is part of the cost of doing business.

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One of the questions asked in Asymco Office Hours. The full recording and transcript are available to Asymco One subscribers.

See the proceedings at asymco.com/live.

An Office Hours discussion, September 11, 2026.

Q: The Duo starts at $2,000. How should people think about that price?

I published this idea that the pricing of the product is about a dollar ninety a day at the starting point of the Duo. Let's round up to two, once you factor in taxes and whatnot. So you end up at two dollars a day, and that's about twice the historical average for the iPhone, or even the average Apple product. The median Apple product is a dollar a day. You can go and check this out: go to store.apple.com, price the product, and see what the lease price is. It'll be approximately $58 per month. Divide that by 365 over twelve and that gets you the daily price. I've done this for all the iPhone configurations, and for other products when they announced Apple Upgrade. Whenever someone says this is going to cost me my mortgage payment, that they can't afford it: you have the option to pay on a monthly basis, and it comes to two dollars a day.

And here's the killer: it's in use four hours a day. Maybe, because of the fold, it's going to be in use more, because people will find jobs to do with it. Entertainment is a huge time sink. People will sit and watch more video, not just short form but long form. Short is easy, that's swiping. Long form: open it up, start watching a movie. Much more comfortable on this device. Then you start to add up the hours and the number of interactions. The average number of unlocks of an iPhone was 80 many years ago. It's possible we're now at a hundred unlocks a day. So two dollars divided by a hundred unlocks is two cents every time you use the phone. If it gets more use, it becomes even cheaper.

I think people intuitively know this is the most useful product they own. It's the one they can't leave the house without. It's the one they panic over if they can't find it. I use my Watch to find my phone every other day. It's so important that you can't be without it for more than a few minutes, and you think about safety all the time: if I don't have my phone, I'm unsafe. If it's that important, two dollars a day. And by the way, the median across all the iPhone variants is a dollar forty right now. You can buy a used one for much less: a used iPhone 15 for $400 or $350, no problem. Even if it only lasts two years, that's less than 50 cents a day. The value is unbelievable.

Q: I did a similar calculation of cost versus daily use across everything I own. The cheapest per hour turned out to be the bed. The smartphone was second.

The bed goes with the house. That's the difference: the phone is always with you, even when you're not at home. I did this for cars, and cars are the worst. A luxury car that depreciates quickly could be over fifty dollars a day. The cost per mile is fifty to sixty cents nowadays, maybe seventy-five with inflation. I don't question the bed. You're in it for so long, and you should invest in a good mattress. I'm pointing out that the bigger objects in your life, washing machines or refrigerators, are super important and very low per unit. What I'm trying to convey is that there are things in life that are underpriced, in a way, because we use them much more than we think. And other times we're spending way too much. Cars are much too expensive for what they deliver. You spend one hour a day in a car and yet you spend tens of thousands for one.

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One of the questions asked in Asymco Office Hours. The full recording and transcript are available to Asymco One subscribers.

See the proceedings at asymco.com/live.