What Apple's shock iPhone sales announcement means for its customers

Apple has made one of the most shocking announcements in its history, and its not a new feature or product. In a strange run of events, Apple froze trading on its stock and was forced to announce that its results were about to disappoint its investors.

The announcement was meant primarily for Apple's shareholders, and the wide circle of analysts and financial markets that revolve around them. Tim Cook's letter announcing the change was addressed to its investors, and included information intended for them.

As an indication of how rare such a statement is, Apple has not done this since 2002 – long before the iPhone, and just months into the iPod era.

For investors and Apple itself, it's a worrying announcement about the future of the iPhone, and an admission that it was not going where it thought. That has happened for a whole host of reasons – many of them not really connected to the iPhone itself, or even Apple.

But the announcement could make a difference to Apple fans and iPhone users in a wide variety of not immediately obvious ways, some of which could be positive. It is one of the most important announcements about the future of its star handset that Apple has ever made, and so will matter in some small way to everyone who uses an iPhone or will do in the future.

It matters, primarily, because Apple said that people are not buying as many iPhones as expected, or as it needed to sell to ensure that its investors were happy. That, in turn, means that it will most likely adjust its strategy to try and make people buy more.

Some of the reasons people are not buying enough are both specific and too general for Apple to do anything about. But others revolve around central parts of Apple's strategy, which touch on all of its customers.

In his letter announcing the weaker than expected results, Mr Cook cited a number of reasons to the drop. He pointed above all to weakness in China's economy – in part caused by an ongoing trade war between it and the US – but he also said that there were problems elsewhere, too.

Chief among the other reasons for Apple's weaker than expected performance is likely to be the higher prices that it has started to charge for its iPhones, as well as other products.

Gradually, Apple has pushed up the prices for both the cheapest versions of its new phones and the ones at the very top of the line. Over the last couple of years, Apple has changed its pricing strategy so that the cheapest model of the phone – the XR, which starts at $749 – would have been at the top end in the years that went before.

As well as leading people to think twice about whether they can afford or want to pay that much for a new iPhone, the higher prices came at the same time Apple announced a wide-ranging and heavily discounted program to allow people to replace their phone's batteries. That came in response to a controversy that raged at Christmas last year, amid suggestions that Apple was intentionally slowing down old phones.

Apple suggested that a higher-than-expected number of people taking up that deal – presumably in part because the battery replacements were so cheap, and a whole new phone was so expensive – had also helped dampen demand. At the same time, Apple made keeping an old phone more appealing in other ways, such as the new iOS 12 update that sped older handsets up dramatically.

That as well as other factors mean that people are holding onto their old iPhones for a longer period of time. And that means they're not buying new ones, hurting Apple.

The company's response is still unknown and could come in a variety of forms. Apple might choose to cut the price of its most expensive models in future, for instance, meaning that the next phone will cost less; it could also try and ramp up improvements in the coming years to ensure that the new handsets remain more compelling.

Whatever happens, Apple appears to have been forced to realise that it has pushed the top end of the iPhone's pricing too far. Customers have given their verdict by just not buying the phones – and it will now be Apple's turn to try and convince them otherwise.

It might also be that Apple turns towards its other products, at the same time, in an attempt to diversify away from the handset that represents a vast part of its profits. It has already been looking to focus on services such as Apple Music to ensure that customers still give it money even after they've bought their products, and has been branching out further into accessories with the release of the AirPods, HomePod and more.