Apple COO Jeff Williams 'Very Aware Of' Concerns Over Apple Product Cost

[racerhomie]

Obviously Apple is a premium brand. You cant say no to that. I am glad that Apple exists as a premium brand in the tech field.They have little to no competition on the high end. People in the states & in Europe can easily afford Apple products. I just hope in the poorer regions of the world like India, Africa & South America Apple pushes the iPhone 6S,7 & iPad 10'. Those products are good enough for most people.

 

[Ebok]

You can buy an iPhone 7, or a much cheaper Android. Apple is not a monopoly in smartphone business. The same for laptops and especially speakers. Plenty of cheaper alternatives. You pick the Apple ecosystem by your own volition.

true... but when you've been sucked into the echosystem, paying $700 for THE flagship which now costs $1000+ just 2 years later, that's messed. and no, the Xr is not a flagship.

guaranteed we will see a price drop this year.

 

[racerhomie]

Plus, if idiots actually looked at the profit margins they have remained between 36-39% for the last 5-7 years. So , no ,they are not making more money on average. Maybe on certain storage tiers, yes. But not overall.

 

[Quu]

How about Apple makes a reasonable profit for once instead of an obscene one?

Nah, forget that. Lets raise prices again

 

[racerhomie]

How about Apple makes a reasonable profit for once instead of an obscene one?

Nah, forget that. Lets raise prices again

Reasonable profits? Who are you to tell Apple that. Dont like the prices, get an older one. Or get a device from another company, plain & simple. Is it that hard?

 

[satchmo]

Hmm...a $1500 Hermès Apple Watch...no, you don’t want to be an elitist company.

I’m sure there was a lot of R&D involved there to justify its marked up price.

 

[Baymowe335]

Plus, if idiots actually looked at the profit margins they have remained between 36-39% for the last 5-7 years. So , no ,they are not making more money on average. Maybe on certain storage tiers, yes. But not overall.

Don’t come in here with facts...

 

[1144557]

Plus, if idiots actually looked at the profit margins they have remained between 36-39% for the last 5-7 years. So , no ,they are not making more money on average. Maybe on certain storage tiers, yes. But not overall.

How about Apple makes a reasonable profit for once instead of an obscene one?

Nah, forget that. Lets raise prices again

Read the post above yours. The facts show Apple profit margins on iPhones were once higher, double digits higher.; into the 70% range. Now its back around 60%. But mostly have remained near steady.

The bill of materials used to be just under $200 for a $600, or 1/3. Now it is $400 for a $1000 phone, so 40%. Higher material cost of the phone cost.

And no one batted an eyelash about price of a 3GS or iphone 4 with higher Apple margins per unit.

More expensive insides equals more expensive phones even with lower profits Apple takes.

 

[djlythium]

So, what lab was newly created to create a novel piece of hardware for iPhones XS and XS Max?

Nothing, because all of the infrastructure for the components were already there. Apple did, indeed, combine them in new ways, but that does not justify the price hike.

It’s straight greed.

And, ultimately, we, the Consumers, are to blame.

Do you all want Apple to lower their prices? DON’T BUY THE NEXT PRODUCT ITERATIONS!

If enough people boycott Apple for even one quarter, especially starting in October, Apple’s lost revenue would be so staggering large that they’d have no choice but to reduce the prices to more reasonable levels.

In the end, it’s on us.
[doublepost=1551060562][/doublepost]

Read the post above yours. The facts show Apple profit margins on iPhones were once higher, double digits higher.; into the 70% range. Now its back around 60%. But mostly have remained near steady.

And no one batted an eyelash about price of a 3GS or iphone 4 with higher Apple margins per unit.

More expensive insides equals more expensive phones even with lower profits Apple takes.

And?

2.5x the BoM! Like, damn!

But, I don’t think it’s really Apple’s fault.

It’s our fault for ‘needing’ the newest devices.

 

[Cyrax]

It's funny to me that people nowadays are so quick to criticize Apple and their products' prices. Apparently I'm old because I remember when Apple was a luxury brand... I mean, even the first iPhone was $699 for the 8GB model... something that was UNHEARD of at the time.

Did you forget that Apple dropped the price a few months later *because* it was too expensive?

Right now, from a hardware point of view, you can get a phone that is, at least, 90% of the iPhone XS for half the price. And Android is a very developed and mature OS. Those phones run the OS really well. Just a few years ago, either you spent Apple/Samsung money and got a high quality phone or spent a few hundred less to get a real hunk of crap phone that could barely run Android. That's not true anymore, the dynamic has changed and it's like Apple hasn't realized it.

Apple's products have a surprising number of issues these days too, battery, screen issues, hard drive problems, keyboard, audio bugs, FaceTime, etc. Nobody's perfect and Apple operates at an incredible scale but I'd expect much better out of a luxury brand. I was ready to spend $1000 on an iPad Pro but decided to stick with my old iPad Air 2 for now because of the bending issues. I just don't want to deal with it.

 

[Quu]

Reasonable profits? Who are you to tell Apple that. Dont like the prices, get an older one. Or get a device from another company, plain & simple. Is it that hard?

haha I think I ruffled some feathers.

 

[turbineseaplane]

"We do not want to be an elitist company"

Too late

 

[mikethemartian]

Quote: "It's something we're very aware of," he said. "We do not want to be an elitist company. That's not".

Subtext: "Which is why we price our SSD so very reasonably. The update to 1 TB barely is 1000 bucks for what is available for less than one quarter of that in retail. So we overcharge by just 4x, isn't that generous of us?"

But they had to put together a team of one hundred executives to ask 1,000,000 potential customers what’s the absolute maximum they would be willing to pay to upgrade the SSD so they had to add those research expenses to the price.

 

[racerhomie]

haha I think I ruffled some feathers.

What are you talking about? I dont care about your statement. Your statement is like telling HP & Dell look, you are making too much money and your laptops should not cost more than $90. You are in no position to tell them what their profits should be.

 

[Quu]

What are you talking about? I dont care about your statement. Your statement is like telling HP & Dell look, you are making too much money and your laptops should not cost more than $90. You are in no position to tell them what their profits should be.

haha

 

[racerhomie]

haha

Very mature.

 

[1144557]

And?

2.5x the BoM! Like, damn!

But, I don’t think it’s really Apple’s fault.

It’s our fault for ‘needing’ the newest devices.

So you're one of those people who dont understand economics and GROSS (this chart, product cost minus material costs) vs NET (after all operating costs spit per unit) profits.

That the BoM is just the physical parts in the phone; not maintaining iOS updates each year (and then for 4-5 years for that device), icloud costs since its free to user, R&D of each new device, marketing, corporate salaries, HQ operating costs, retail stores, retail employees, repairs/supply chain, etc

 

[Baymowe335]

haha I think I ruffled some feathers.

He’s right. Apple dominates because people buy. If you can’t afford them, that’s an anecdote.

 

[Cosmosent]

Who does the Strategic Product Planning @ AAPL ???

That's where they seem to be lacking the most.

 

[expelled]

This is so great! It’s like both Apple and MacRumors are looking out for us, I genuinely feel taken care of!

THIS POST HAS BEEN CENSORED FOR YOUR PROTECTION

 

[anthogag]

R&D definitely can be very expensive. That is why companies like Samsung and Huawei copy or steal from competitors.

But, Jef Williams is lying somewhere because the proof is in the pudding. Every quarter they are reporting very significant profits from iPhone sales. I am guessing if they make $20 billion from iPhone sales in a quarter, how much was R&D for the quarter? $3 to $5 billion.

 

[sosumi99]

Apple’s pricing isn’t the problem. The problem is that the quality doesn’t match the price. For $2000+, a laptop ought to outperform the competition and not have a keyboard that fails in regular use. Neither should it have a TouchBar that, three years later, still has no software support to do anything useful. And it definitely should not have such awful battery life that people must download software to throttle the CPU deliberately in order to last through a coast-to-coast flight. THAT’S THE PROBLEM!

 

[Ladybug]

Apple imo has become fat (with cash), happy (just watching their piles of money stack up), and lazy (4 plus years to work on some upgrades). They aren’t hungry anymore so they have no incentive to do better.

 

[osaga]

I want the solid glass iPhone Johnny Ives keeps talking about and I want it for $600 tops next September. I permit Apple to not make more than $10 per device above material costs only, all services to remain free. Housing, healthcare, college, and iPhones are a human right.

 

[whiteboytrash]

"Analysts don't understand the work we do to maintain massive profit margins. They just have this unhealthy obsession with price."

It is true. Recent Supreme Court decision in the Hobby case states that public companies do not have to maximise profit for shareholders. Directors have immunity under the business judgment rule if they wish to charge less for products, thus less profit and be immune from civil cases from shareholders.