iPod touch Apple, apple, apple.... you're so tricky.

[balamw]

This law requires that companies charge for significant features added to already-purchased products. Same reason that the wireless-n update costs $1.99.

FWIW they account for revenue for iPhone and TV over two years as a "subscription model" to avoid this kind of accounting issues. I believe that Apple's interpretation of the rules say that they have to charge a fair market value for the new features, which is why they don't think they can make the fee $0.01.

I do not understand why they didn't choose to account for iPod touch revenues in the same way as iPhone though, since they probably expected to introduce new firmware at some time.

B

 

[deverill]

$20.00 is not a token payment.

Maybe so but the law didn't require Apple to charge $20 for the features. Charging $5 would have been easier to deal with.

Indeed, I heard that $1.00 is the limit in the US to be a legal amount for property change, so if I can buy a family member's car for $1.00 why is this stream of bits that everyone else is getting for free costing $20?

Maybe we should investigate a suit against Apple for disenfranchising us from the equitable enjoyment of a product that certain others get free and we must pay for the privilege of being in their class. lol

 

[User101270]

For those of you who purchased the iPod Touch update

...and later discovered that the feature set you purchased was being offered free to newer customers, I advise calling and speaking w/ an Apple representative. For customer service representatives those folks have an unusually high amount of discretion in issuing credits/refunds.

Just a suggestion.

 

[SimonTheSoundMa]

Blame it on the Sarbanes-Oxley Act.

This law requires that companies charge for significant features added to already-purchased products. Same reason that the wireless-n update costs $1.99.

Means Apple should charge for point releases and security updates. Oh, and also for the pro app updates where new functionality is usually added in point updates. Oh, for one the Touch is advertised as "subject to change" and why should it include myself from the UK where this law means nothing.

 

[razorianfly]

and why should it include myself from the UK where this law means nothing.

It's nothing to do with this 'law' thats being bantered about. Apple charged for the update:

1. Because time/man hours and money were spent on the original coding (i'm talking before they hit iPhone) and implementation of the 5 applications found in the update.

2. Apple see iPod touch and iPhone as one platform now, presuming you have the update installed. Once the SDK comes along, the only difference between Ipod touch and iPhone, will be, one has a phone, and one doesn't. Leopard OSX 10.5 cost you all £79 to experience it. Welcome to the first update of the mobile OSX platform.

This is why, for the people who bought the update (i.e Me), why Apple decided to charged you for the update.

12.99 for 5 New, not-originally-included, applications, on iPods touch? - and people are complaining? Lets see:

12.99 / 5 = 2.598

£2.50 an app. I think thats pretty reasonable of Apple.

Keep the updates coming Apple, iPOd touch is proving it's worth after all.

R-Fly

 

[phytonix]

12.99 for 5 New, not-originally-included, applications, on iPods touch? - and people are complaining? Lets see:

12.99 / 5 = 2.598

£2.50 an app. I think thats pretty reasonable of Apple.

Keep the updates coming Apple, iPOd touch is proving it's worth after all.

R-Fly

You have maybe 40 native Apps on Mac OS X Leopard. Because it is a full featured OS, $10 per App would be reasonable to you I suppose. Then why don't you just pay $400 for Mac OS X Leopard????

 

[razorianfly]

You have maybe 40 native Apps on Mac OS X Leopard. Because it is a full featured OS, $10 per App would be reasonable to you I suppose. Then why don't you just pay $400 for Mac OS X Leopard????

Because I don't want it, yet?

That wasn't my point, you seem to have completely missed it.

R-Fly

 

[phytonix]

Because I don't want it, yet?

That wasn't my point, you seem to have completely missed it.

R-Fly

You made too many assumptions like you work for Apple and know exactly what's going on. And tried your best to justify the $20 for Apple. You whole argument is totally absurd. Maybe you are one of the the reasons why Apple has higher pricing in UK.

 

[kcbyemom]

For Heaven's Sake

I have been lurking here for some time. Thanks to you and your brilliant thought provoking arguements I have moved to Mac. 1 iMac, 1 nano, and 2 touches later I'm delighted and saving for more.
This arguement is absurd! SOx is something you can research but best of luck understanding it. The feds are trying to protect us from icky Enron types. Apple may be taking the most strict observance of the law. That is their choice. You either want their product or you don't. Heaven only knows how much we pay to competitors to cover their accounting errors - it is considered an operating expense and translates to cost of goods sold.
The $1 rule is sort of accurate but if it is deemed by the IRS to be less than the "value" the purchaser must claim the difference as income. It is irrelevant where the product is exported Apple is traded here and still pays taxes in the states. Ask your CPA to explain the rest; it is boring, silly, and unfair but it is an obligation that has far reaching consequences.
FWIW, even IF Apple's decision has nothing to do with tax code who cares. People put in more hours working than we have groaning and they deserve to make their dime. Please let this dog lie.

 

[razorianfly]

This arguement is absurd! SOx is something you can research but best of luck understanding it. The feds are trying to protect us from icky Enron types. Apple may be taking the most strict observance of the law. That is their choice. You either want their product or you don't. Heaven only knows how much we pay to competitors to cover their accounting errors - it is considered an operating expense and translates to cost of goods sold.
The $1 rule is sort of accurate but if it is deemed by the IRS to be less than the "value" the purchaser must claim the difference as income. It is irrelevant where the product is exported Apple is traded here and still pays taxes in the states. Ask your CPA to explain the rest; it is boring, silly, and unfair but it is an obligation that has far reaching consequences.
FWIW, even IF Apple's decision has nothing to do with tax code who cares. People put in more hours working than we have groaning and they deserve to make their dime. Please let this dog lie.

Well said.

R-Fly

 

[mrgreen4242]

Blame it on the Sarbanes-Oxley Act.

This law requires that companies charge for significant features added to already-purchased products. Same reason that the wireless-n update costs $1.99.

Wrong, wrong, wrong. This is a story Apple is allowing to account for these actions. Don't take it from me, take it from the former Chief Accountant for the SEC.

http://gizmodo.com/gadgets/wireless/accountants-say-apples-199-80211n-tax-is-bogus-230538.php

 

[SNeil]

It's nothing to do with this 'law' thats being bantered about. Apple charged for the update:

1. Because time/man hours and money were spent on the original coding (i'm talking before they hit iPhone) and implementation of the 5 applications found in the update.

R-Fly

So they need to charge ONLY those people who bought from the Touch release date till Jan 14 ? And not those people who will be buying from now onwards ? And all those people bought before, these apps are optional, so what if only 10% of those people actually buy ? will that be sufficient to offset the development costs ?

 

[kcbyemom]

Wrong, wrong, wrong. This is a story Apple is allowing to account for these actions. Don't take it from me, take it from the former Chief Accountant for the SEC.

http://gizmodo.com/gadgets/wireless/accountants-say-apples-199-80211n-tax-is-bogus-230538.php

The former that was quoted left in 2001, SOx was established middle of '02. Not to imply his opinion is less than valid but "generally accepted accounting" changes from firm to firm and penalty by penalty. Apple is under fire, as are many, let them run their business so we can have more toys.

 

[gothiquegirrl]

Now keep in mind I'm one of those people who HAS to get everything at the lowest price possible... my question is, whether to just buy from amazon now and then spend the $20 for the apps, or wait some undetermined amount of time to save the $20....

wahhh

I bought my 16GB touch on ebay - $317 ( with express shipping) and so with the apps - it's what.. $337 ?

I thought I got a good deal... Try looking there. Auctions that end in the middle of the day on a weekday generally go for less than stuff that send on the weekend or a hight traffic time.

Ang

 

[kcbyemom]

That sounds like a great deal to me! I can't live without mine and my son is worse with his 8G. I still haven't done the new apps yet, I will in time.
I've never owned anything that was 1st generation before - ever. Still adjusting. I think I like being near the front of the line.

 

[deverill]

The $1 rule is sort of accurate but if it is deemed by the IRS to be less than the "value" the purchaser must claim the difference as income.

This makes no sense to me. If Apple sells a product, the iPod Touch, and people pay $X for it. Then they have new stuff they sell for $1 each. And if the IRS says it's worth $20 (who are they to say anyway?) then Apple has to pay tax on $20 income they only got $1 for? That doesn't flow. Income in money IN COMing. This only happens IF they charge for the upgrade, not if they don't.

The only way it seems to be a problem is if Apple claims $X in revenues last year for a product they sell with the implicit understanding that more is to come later and is part of that price.

The $X I paid for mine was not for future deliverables and was not counted by Apple as such so why is it a problem?

So if I buy a car on Dec 30 and the dealer mails me free movie tickets 1 week later as a "thank you" then they have to charge me for the tickets? I can think of tons of examples where this breaks.

I realize I'm not an accountant and this stuff is very complicated, but if SOx is to stop companies from reporting revenue before it is actualized then it's not an issue here because Apple didn't report the revenue in '07 for the extra utilities delivered in '08 - they only reported revenue for the unit.

 

[kcbyemom]

I'm not the CPA, my husband is. I don't work for the IRS but our next door neighbors do (imagine our chit chat's over the fence). None of us are tax attorneys but we've met a couple over the years. All of this then needs the disclaimer that I was simply trying to offer a general Joe's explanation to the reasons why Apple may have made certain choices along the way, whoever first mentioned it deserves kudos as it seems to me to be quite logical.
SOx applies to those who answer to the SEC. The date of transaction is irrelevant and the car dealership doesn't quite fit the argument - but I hear what you're saying.
I agree that the IRS should have no right to determine a value for anything - regardless I am limited to the value I can claim for each sweater I donate.
Any non-tangible (like a download) could be used by evil bean counters to hide income from the gov't or losses from investors. The investigation alone is costly, whether they are guilty is irrelevant. All associated expenses factor into my next purchase.
So, if Apple gives me $100 or a free printer under the strictest observance of tax code I should claim that as income. The fact that most folks have no clue that could be considered income doesn't change the code. The gov't would pay more to audit than they would glean in tax from me. But I received $100 that should have been taxed somewhere. Every dollar matters when we flush it faster than we can print it.
If I ran compliance in Apple's tax dept I wouldn't have time to explain something that most people don't notice, others don't comprehend, and the rest declare a conspiracy. If I owned stock I would be pleased with my perspective of their logic.
All sides of this are speculation. Maybe they do just want to make more money. I choose to sponsor Steve's effort to take over the world! Beats the heck out of the rest of our choices right now.

 

[Ollie1216]

Granted the apps are cool but considering the previous owners of the iPhone and Apple TV got free upgrades...why not previous owners of the Touch?

Why don't you just stop your whining!!! Do it or don't do but just leave us alone... you are only about the thousanth whiner we've heard on this subject.

 

[ScottFitz]

Lots of mental masturbation on this subject. I have been a recent Apple convert in the last 18 months and honestly feel pretty screwed over on the touch I bought for x-mas that isn't "as good" as the ones they are selling today. All this on a product that initially launched in Sept or Oct? Apple can sum up all sorts of "legal" reasons why they just *had* to charge for the apps, but it's landing on deaf ears in my case.

15 yard penalty on Apple for ********

 

[BrownManUPS]

ok, there's another thread pretty much exactly the same as this one, and there was at least one person who ordered from amazon and is getting it soon. i'll see what happens to them before buying.

I think your amazon route is the best way to go. That's 20 more dollars cheaper and all you pay is for the tax, because normally they do shipping for free. Buying an iPod from apple would be the same, but the 20 dollars you gained would be non existent.

To put this in numbers
Amazon 1.1.2 = 359.99 (Cheap new from some third-party)
Amazon 1.1.3 = 399.99 (If new from an authorized dealer)
Apple 1.1.2 = 379.99 (They did this for you whiners)
Apple 1.1.3 = 399.99 (Standard, with apps)

And so you see the inherent 20 bucks you save. So really, you don't have a problem.

And previous owners, you knew what you were getting when you bought it much before macworld, so don't crawl back and whine about it now. And if you bought it 3 weeks before macworld, you could try to make your case to Apple, but more than that I think it's fair that they charge. The apps are really worth it...or at least I find notes is huge.

 

[davidy]

Boo Hoo

I think you whiners are completely nuts.

No company on earth is obligated to provide free upgrades to products previously sold without the upgraded features.

I have bought eight computors in the past 13 years. Each and every one of them was superceded by an upgraded version within six months of the time I purchased them. There was absolutely no thought that I should have contacted the seller and demanded a new version for the price I had already paid. If I had tried that I would have been laughed out of the store.

You buy a car, then a newer version comes out. You buy a printer, then a newer version comes out. You buy a TV, then a newer version comes out. You buy am iPod Touch, then a newer version comes out.

If you buy a shirt and later the same one goes on sale. Do you think you're entitled to a refund of the difference in price after several months?

In no case does the manufacturer owe you a penny. You bought what you bought. You accepted the features and price at the time you made the purchase. If additional features become available - PAY FOR THEM and go on about your business, or do without them. Quit whining; it's tiresome.

 

[eplchamps0304]

Bottom line is...to charge for the new updates is not cool. $20 may not be a lot of money but an update comming from the manufacturer should have been free. Couple this which the fact that apple won't even include a wall charger with their product, that's just not consumer friendly. To those complaining about the $20 you have a valid point, and those that are ok with it don't slag on those that complain. The botttom line is apple is having their way with us because, right now they can.

 

[eplchamps0304]

I think you whiners are completely nuts.

No company on earth is obligated to provide free upgrades to products previously sold without the upgraded features.

I have bought eight computors in the past 13 years. Each and every one of them was superceded by an upgraded version within six months of the time I purchased them. There was absolutely no thought that I should have contacted the seller and demanded a new version for the price I had already paid. If I had tried that I would have been laughed out of the store.

You buy a car, then a newer version comes out. You buy a printer, then a newer version comes out. You buy a TV, then a newer version comes out. You buy am iPod Touch, then a newer version comes out.

If you buy a shirt and later the same one goes on sale. Do you think you're entitled to a refund of the difference in price after several months?

In no case does the manufacturer owe you a penny. You bought what you bought. You accepted the features and price at the time you made the purchase. If additional features become available - PAY FOR THEM and go on about your business, or do without them. Quit whining; it's tiresome.

You are also whining. You are comparing a hardware upgrade to a software upgrade?

 

[chrono1081]

Lol

i just did an apple store Chat and asked them if i would be entitled to the apps. they said "I don't have any information on that. But you should buy it at the Apple Store to get free customized engraving!!!"

what the hell apple...

Hahahaha I had a similar experience with apple chat.I told them I was switching from windows and I asked if mac OS came with a c++ compiler or if I would have to buy one (and what it was called) and I got "Mac OS is the most advances operating system in the world! It can even run windows if you need to." Um..no...I dont wanna run windows....and I STILL dont know the answer to my question lol.

 

[angelodmhl]

Microsoft gave away for free a firmware update to Zune 1.0 owners, that made their software look and act like Zune 2.0. Sure, Zune is a flop and they didn't want to piss people off since they try to stay in the market, but they could have pulled an Apple on their existing customers and make them upgrade to the newest hardware, or make them pay for the new features, but they didn't.
What a twisted world we live in... MS makes Apple look like the bad guy