IF you thought sales of iPhones or iPads were Apple's biggest growing markets, you'd be wrong. Growth of both of these is actually in decline.
It's actually e-commerce - via iTunes, iBooks and the app stores. Sales of extra, non-Apple "stuff" via Apple's products were up 19 per cent to well over US$4 billion in the first three months of 2014.
This business is one of Apple's smaller lines, of course. But it's still impressive. If there was a standalone tech start-up that was doing greater than US$16bn a year in digital e-commerce sales, and growing at nearly 20 per cent a year, everyone would be talking about it. It is significantly larger than some of the other hotly followed e-commerce businesses on Nasdaq. While the tech press is obsessed with plans for an iWatch and multiple other consumer electronic devices, it's wise to pay closer attention to Apple's retail plans. It looks like its future growth might come from online and mobile retail, not from creating new electronic inventions.
Apple chief executive Tim Cook recently pointed out that people love being able to buy content, whether it's music or movies or books, from their iPhone, using Touch ID and that the mobile payments area in general is one that Apple is intrigued with, and a big opportunity.
If Cook had made exactly the same statements about watches or TVs, everyone would have freaked out. Apple fanboys would be jumping for joy.
But because he's talking about the dull-but-lucrative business of retail, everyone is ignoring it. In terms of mobile retail, Apple is already ahead of Google and Android. Even though more people own Android devices but much more shopping by a ratio of two to one happens on iPhones. That is probably what Tim Cook is referring to when he refers to "the amount of commerce that goes through iOS devices versus the competition that it's a big opportunity on the platform".
Apple has the credit card details for hundreds of millions of Apple ID account holders so there is no surprise it's a big opportunity. One of Apple's most important recent technological advances has been retail-orientated.
Because Touch ID makes your phone almost completely secure with its fingerprint identity sensor, the iPhone suddenly becomes an almost perfect mobile payments device.
Apple e-commerce chief Eddy Cue is building a mobile payments platform for Apple right now, according to the Wall Street Journal. He and another exec Jennifer Bailey have met with PayPal, Google, Square, Stripe, Braintree and Venmo to help develop this new system. Apple is simultaneously building a mobile retail marketing infrastructure across America. It's called iBeacon.
Stores are already installing these low-powered Bluetooth transmitters so that when you walk past a shelf they can send your iPhone with an ad or an offer. Soon, if you keep your iBeacon functionality switched on, Apple and its iBeacon partners will know where you're shopping, all the time, down to a location of just a few feet.
This technology will no doubt migrate into Europe and eventually the shops in Northern Ireland. And if it becomes possible to pay with your phone instead of your wallet, then Apple will have successfully "closed the loop" on mobile retailing. For years, the big hit of mobile marketing has been to figure out a way to encourage a phone user to go to a store and buy something at the checkout, and then to be able to immediately attribute that specific sale to a specific phone or owner. This is what marketers mean by "closing the loop".
Some companies have tried, but it is trickier than it sounds. You can check-in on foursquare or facebook at a shop all you want, but only when the shop can link your check-in to a sale does it create real value. Having an iPhone user accept an offer inside a store via iBeacon and then pay using their phone, in theory, solves that problem.
And if Tim Cook really has got this figured out, it's likely to become a lot bigger business than iWatches ever will be.
With iBeacon and similar systems becoming available, the impact for the north's retailers will be huge. All this "big data" held on customers activities in store and purchases will help improve how offers are presented and even how layouts of stores may change to increase the conversion ratio of offers to sales.
* Patrick McAliskey is managing director of Novosco, an indigenous Northern Ireland IT infrastructure company with offices in Belfast, Dublin and Birmingham. It employs 80 people and works for leading organisations across the UK and Ireland, including many of the north's top companies, UK health trusts, councils and other organisations.