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Jony Ive’s departure symbolizes Apple’s iPhone crisis, and shift to services

Jony Ive, Apple’s iconic device designer, is to leave the company to set up his own firm, adding to the general perception that the iPhone maker has lost its edge in innovation and design.

The company has been seeing an unprecedented slowdown in sales of its flagship product, on which it is desperately over-reliant, and now the iPhone’s designer is to depart. And the move is symbolic of Apple’s process of ‘growing up’ – shifting its developments and growth plan to the content and services that run on its devices, rather than relying primarily on the design cachet of the hardware and interface.

The news pushed Apple’s shares down and analysts at Deutsche Bank echoed the views of many, writing that he was “perhaps second only to CEO Tim Cook presently in terms of impact to AAPL’s success”.

On the positive sign, some pointed out that Ive’s new firm would count Apple as a customer.

Daniel Ives, an analyst at Wedbush, told clients this was “a major changing of the guard … Ive is leaving a hole in the company and is clearly irreplaceable.” Although Ive will not be competing with Apple, a fact that reduced analysts’ concerns about short term impact, Ives added that the news “only adds to the current agita around the Apple story as the company is branching out into television and gaming all while it is currently the poster child for the US/China UFC trade battle on the heels of the G20 summit.”

Bloomberg Intelligence said Ive was “leaving a void at a critical time when the company is striving to reinvent the iPhone, though we believe any effect will be muted by Apple’s shift in focus to boosting services and software vs driving sales through hardware innovation. Therefore his departure is less impactful [than] it would have been in prior years.”

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