APPLE The deals with Amazon and Google only point to one thing: sliding sales, writes

Andy Pemberton

As I write this, The New York Times is reporting Apple was worth more than $1 trillion at the start of November. Today, it’s valued at $880bn.

But it is not this plunge in value of $120bn in 21 days that has led me to this realisation.

Instead, it was the news way back on November 9 that Apple will make its products available on Amazon. (It used to be the case that only Apple TV products, alongside some accessories, were available on the e-commerce behemoth.) That is big news. Historically, luxury products have refused to allow their products on Amazon – and with good reason. Distribution has a big impact on a customer’s attitude to a brand. That’s why Hermès doesn’t distribute via Walmart, for example.

But now Apple, whose brand is arguably the ultimate expression of luxury and status, is allowing its products to be flogged on Amazon.

The benefit to Jeff Bezos is clear: he wants Amazon to be the store that sells everything. And, as others have noted, when Amazon partners a brand, the relationship is less partnership than virus and host, with all the benefit heading in one direction only – to Amazon.

So, for Apple, the deal is not all good news. That whirring sound? That’s Steve Jobs spinning in his grave.

Under the deal with Amazon, Apple will now get to control the price of its products in a secondary market, with independent resellers no longer able to sell Apple products on the site in the new year. (However, it is worth remembering that Nike tried this same gambit and could not stop the so-called “grey market” for its goods on Amazon.) Apple can also benefit from Amazon’s huge marketing push as Christmas approaches.

But few would deny that this is a non-aspirational setting for Apple – a brand that famously took billions out of broadcast advertising and spent that money on glass temples called Apple stores. Apple holds up to $8bn in store leases and, as one critic said, “Apple stores are so great I’d like to live in one”.

The fact that Apple is now selling on Amazon unquestionably denigrates the brand and undercuts its efforts to make iPhones a luxury status item that, in some cases, commands profit margins of up to 71 per cent. Those margins have already slipped to 55 per cent and, if Apple isn’t careful, that could slip even more.

A month after giving Google a shellacking for its hoarding of industrial amounts of personal data, Apple’s chief executive, Tim “privacy is a human right” Cook, inked a deal worth $9bn a year to make Google the default search engine on Apple’s iPhones.

Why would Apple do this? There can be but one reason: sales are slipping.

All the people who have bought an iPhone X have already bought one; no-one would doubt that Apple’s innovative edge has been blunted (Jobs was an innovator; Cook is a manager, as the late roll-out of the underwhelming Apple Watch proved); a trade war with China is taking its toll; Cook has admitted that he thinks US government regulation of the tech sector is an inevitability.

The problem for the rest of us is that as Apple falls – in September, it was the US’s first trillion-dollar company – so does the stock market. The New York Times reports that the recent tumble in tech stocks has pushed major stock market indices into negative territory, “leaving investors clinging to a gain of less than 1 per cent for the year”.

Don’t get me wrong; I am sad for Apple. It turned itself from a stylish but not too successful computer company into a retailer’s dream: a luxury brand with mass-market sales. That is a staggering achievement.

But the signs are clear. It’s past high noon for this once unstoppable company. Apple has, as US critics have already stated, jumped the shark. Andy Pemberton is director at Furthr