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16gb vs 64gb iPhones - cost and profit for Apple

e93to

e93to

macrumors 6502a
Original poster
Jan 23, 2015
824
184
Toronto
I remember when Apple used to be the leader, but now they have less starting storage than $300 budget Android phones. Most Android flagships have either 32GB or 64GB starting storage these days.
 
For me Apple has dropped prices. My 5s 32gb was $750 and my 6 64gb was $750. A $200 price drop.
 
This is why the SE is so much cheaper than the 5C was. In 2016, they know the majority of users will make the upgrade to 64GB, making the real price $499. But by offering a 16GB, they get to advertise it as $399.

By holding at 16GB, the average selling price for new iPhones goes up every year. It's quite brilliant actually.
 
drjsway said:
This is why the SE is so much cheaper than the 5C was. In 2016, they know the majority of users will make the upgrade to 64GB, making the real price $499. But by offering a 16GB, they get to advertise it as $399.

By holding at 16GB, the average selling price for new iPhones goes up every year. It's quite brilliant actually.
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Especially with the entry level device that they are positioning it as the majority of users will still go for the cheapest price possible and thus 16 GB.
 
Who cares, I mean they are in business to make a profit, so what if they make more more of a profit in the higher priced item. I see nothing wrong with that.
 
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One cannot simply equate margin to the product solely.
An iPhone is expensive, but I know I can go to any Apple Store in the world to get support.
A xiaomi phone is cheap, but what I buy is what I get. That's it. If I need support, well, good luck on me.

If you run a business, you do need big margin so you can expand and keep working on supporting and making new products. Imagine if Apple has near zero margin. How would they afford to have Apple stores, let supporting their products? It explains why you don't see much updates on Android. They can't as their margins are super thin and can only be used for making new products to sell.

What people should be looking is Samsung. They charge premium for their devices like Apple, but they don't provide support anywhere close to Apple.
 
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who cares ?
Don't get me wrong: I'm not happy about Apple using 16 Gb for the base model, but fortunately I have choices (and I bought the 64 Gb version).
In my opinion Apple should have changed starting from the iPhone 6, offering a 32/128/256 option.

I'm positive the iPhone 7 will follow the iPad Pro path: 32 Gb for the base model, with 128 Gb and 256 Gb options available.
 
There is a big business market for 16gb phones. The SE just made buying phones for employees cheaper.
 
pika2000 said:
One cannot simply equate margin to the product solely.
An iPhone is expensive, but I know I can go to any Apple Store in the world to get support.
A xiaomi phone is cheap, but what I buy is what I get. That's it. If I need support, well, good luck on me.

If you run a business, you do need big margin so you can expand and keep working on supporting and making new products. Imagine if Apple has near zero margin. How would they afford to have Apple stores, let supporting their products? It explains why you don't see much updates on Android. They can't as their margins are super thin and can only be used for making new products to sell.

What people should be looking is Samsung. They charge premium for their devices like Apple, but they don't provide support anywhere close to Apple.
Click to expand...

That's a good point. The support Apple provides imo sets them apart by a wide margin right now over other oems.
 
1. Have you ever priced out different trim levels and add-ons for vehicles? There's no way it costs them what they charge, but it's their prerogative, as it's their company and business model. If you don't like it, don't buy it. The same could even be said for restaurants. There's no way a beer/coke/wings/fries cost them that much, but if you want to eat wings and drink beer there, that's what you pay. It's their business. For better and worse, Apple is capitalist, which means we vote with our $$$.

2. A better question than how Apple gets away with making an extra $88 on upgrades is what other handset makers are doing with their profits? Apple at least gives you an ecosystem, a decent warranty, excellent customer service, store to tryout new gadgets, etc. with its profits. What's Sammy doing?

@e93to , not sure why you think this thread would be locked, except that your source material is BusinessInsider, which has developed a reputation for having the impartiality of Rush Limbaugh or Mother Jones.
 
617aircav said:
For me Apple has dropped prices. My 5s 32gb was $750 and my 6 64gb was $750. A $200 price drop.
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I don't follow. You paid $750 before, and you paid $750 now. The price of the mid-storage tier model remained the same.
 
geoff5093 said:
I remember when Apple used to be the leader, but now they have less starting storage than $300 budget Android phones. Most Android flagships have either 32GB or 64GB starting storage these days.
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If android phones are a better deal for you, you are free to buy one. Apple doesn't owe you anything.
 
Last edited:
Q-Dog said:
If android phones are a better deal for you, you are free to buy one. Apple doesn't owe you anything.
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You must be quoting the wrong person, because I never said anything of that. I'm saying apple needs to get with the times and start offering base storage that was standard on android in early 2015. They tout 4k recording and live photos yet haven't increased the base storage in several years.
 
Anybody who buys a 16 GB phone is just asking to have a bad experience with their iPhone. With Live Photos and 4k video recording, anybody who takes even an ordinary amount of photos and videos is going to find themselves quickly having to back their stuff up to a PC... because 5 GB of free iCloud storage is an absolute joke.

Apple was right to up the baseline of storage to 32 GB on the iPad Pro. We can only hope that they finally catch up to the rest of the world with the iPhone 7 and offer a 32 GB baseline, otherwise it will rightfully be heavily ridiculed.
 
geoff5093 said:
You must be quoting the wrong person, because I never said anything of that. I'm saying apple needs to get with the times and start offering base storage that was standard on android in early 2015. They tout 4k recording and live photos yet haven't increased the base storage in several years.
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and if you need more storage, Apple offers that option. Apple doesn't play the specification game.
 
geoff5093 said:
The base model needs to be upgraded, that's my point. People shouldn't be forced to pay more for what should be standard in 2016
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No one is being "forced" to do anything. Apple doesn't owe you anything. If you need more storage, buy more storage ... either with a larger iPhone or one of the many other devices you mention that have more storage.
 
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