Apple Has Begun a Trend of Nickel-and-Diming Customers

[MICHAELSD]

It's unfortunate to watch the world's largest company continuously move product lines over to a nickel-and-diming model that not only encourages up-charges, but necessitates them for an optimal experience. The most prominent product where this is apparent is the iPhone 6s: 16GB was fine when they originally made it the base model and for a few years after, but nowadays 16GB is unusable for all but users who solely use the stock apps so the jump to 64GB is necessary to not have to constantly deal with "storage full" notifications. Then, rather than boiling down to size preference for no reason other than to up-charge customers the Plus model solely contains optical image stabilization. So we're at at least $849 for the optimal iPhone experience.

The new iMac continues this trend with a bottlenecking 5400rpm HDD in its base model that ruins the entire experience. Apple doesn't even offer a 21.5" model with a Fusion Drive or SSD in its retail stores! Likely in an attempt to upsell to the 27" model, which is quickly becoming overkill for most consumers.

Frankly I'm satisfied with the Retina MacBook Pro offerings, which includes all or more than the average consumer needs in its base 15" model. Yet I'm worried this will change and Apple will continue the trend of bottlenecking products to get consumers to upgrade. Some may say this trend isn't new, but all base models thus far have been perfectly usable and not bottlenecked in a blatantly-purposeful way.

 

[BittenApple]

Don't buy their products. Speak with your wallet.

 

[SeattleMoose]

They started the trend towards closed throwaway systems with limited but highly expensive upgrades. And they have continued perfecting it. The great dumbing down continues. Sadly, the competition is even worse except for MS in some ways, but then you have to deal with Windows. But hey no worries, coming are more Emojis and tighter Social Media integration.

 

[MICHAELSD]

They started the trend towards closed throwaway systems with limited but highly expensive upgrades. And they have continued perfecting it. The great dumbing down continues. Sadly, the competition is even worse except for MS in some ways, but then you have to deal with Windows. But hey no worries, coming are more Emojis and tighter Social Media integration.

There's no issue with the platform being closed; the products are thinner and more efficient as a result.

 

[BFaro]

What a coincidence. I've been thinking the exact same thing the last couple of days. It is classic nickel and diming at work.

Between the price increases in New Zealand, Brazil and Canada et al. and the insistence on keeping the base iPhones & iPads at 16GB for yrs, we now have the new iMacs pre-configured with smaller SSDs and still sporting 5400rpm drives. Seriously, 5400rpm drives? As has been pointed out, the original iMac had 5400rpm drives almost 20 yrs ago!

I know this is all being done to maximize profits, but as a shareholder I'm a little concerned. Except for in the US, I doubt that sales are going to be anywhere what they've been in the coming year. I personally am beginning to postpone purchases for the foreseeable future.

If sales remain steady outside of the US in the coming year, I'll be stunned.

 

[aesc80]

I'm personally not surprised. You see this in plenty of the top tier <state widely used and desired product here>. BMW and Mercedes-Benz have been doing it for years. 300 series and C class base cars are so overpriced and under configured, it's as if they want you to know these are not what you want. However, much like Apple, these products are in high demand and hardly every questioned by those who can afford it. To those who are diehard fanatics or have the financial means, they can care less - they'll take it simply to state it. Those who are trying to make financial sense of it all will be very hesitant.

Apple will continue this trend until they realize that they've turned off enough people to make their bottom line on their quarterly reports shrink. Then it'll get added, like a feature, in the hopes that everything comes back to normal.

 

[MICHAELSD]

I'm personally not surprised. You see this in plenty of the top tier <state widely used and desired product here>. BMW and Mercedes-Benz have been doing it for years. 300 series and C class base cars are so overpriced and under configured, it's as if they want you to know these are not what you want. However, much like Apple, these products are in high demand and hardly every questioned by those who can afford it. To those who are diehard fanatics or have the financial means, they can care less - they'll take it simply to state it. Those who are trying to make financial sense of it all will be very hesitant.

Apple will continue this trend until they realize that they've turned off enough people to make their bottom line on their quarterly reports shrink. Then it'll get added, like a feature, in the hopes that everything comes back to normal.

I think the difference between BMW and Apple is that everyone, from all social classes and backgrounds, buys Apple so many do have to worry about the cost.

 

[aesc80]

I think the difference between BMW and Apple is that everyone, from all social classes and backgrounds, buys Apple so many do have to worry about the cost.

I'd say that's only true about iPhones. iPads are fewer apart, while iMacs and MBPs are even more scarce than that. The price is only popping up now because more people are having to buy without contract. Those that used 2 year subsidies and programs like Next are only seeing it as "that much more to max out", which makes things brilliant for Apple's bottom line.

Still, it doesn't change the fact that the deeper you get into the fanhood (M lines might as well be full blown MBPs, with iPhones and iPads added), the more you kind of don't care about paying that much extra.

 

[MICHAELSD]

I'd say that's only true about iPhones. iPads are fewer apart, while iMacs and MBPs are even more scarce than that. The price is only popping up now because more people are having to buy without contract. Those that used 2 year subsidies and programs like Next are only seeing it as "that much more to max out", which makes things brilliant for Apple's bottom line.

Still, it doesn't change the fact that the deeper you get into the fanhood (M lines might as well be full blown MBPs, with iPhones and iPads added), the more you kind of don't care about paying that much extra.

Is that why you have an iMac, a MacBook Pro, an iPad Air, a 6s +, and a 6+? Seems a bit like overkill.

But yes I agree, especially for enthusiasts paying extra really isn't a big deal. I do admit I browsed some other tech company's laptop lines and even $1500 for a laptop specced to my preference seemed cheap.

 

[decafjava]

Oh and you have a good point about nickel and diming....shameful to offer such low storage on the base model of iPhone and the low speed HD on the new Macs.

 

[aesc80]

Is that why you have an iMac, a MacBook Pro, an iPad Air, a 6s +, and a 6+? Seems a bit like overkill.

But yes I agree, especially for enthusiasts paying extra really isn't a big deal. I do admit I browsed some other tech company's laptop lines and even $1500 for a laptop specced to my preference seemed cheap.

LOL ... yeah, I went deep down the rabbit hole. Thankfully, my work provided the MBP and the 6+. I personally own the rest, unless you consider my daughter owning the iPad, cause I haven't used that thing in ages! lol.

 

[0928001]

but nowadays 16GB is unusable for all but users who solely use the stock apps so the jump to 64GB is necessary

I use a 16GB iPhone 6 and use 25 apps in addition to stock apps, and still have 5.5GB remaining. I find it perfectly usable. The verbiage in your post suggests you are stating your claims as fact, when they aren't. If I were put in front of Apple and asked what I thought about 16GB of storage for an iPhone, I'd for sure go to bat for the rest of you about it being too little. But the reality is, not everyone NEEDS 64GB. If they did, the 16GB model wouldn't sell. The people who buy 64/128GB models already know they will need that space.

Regarding OIS, this is what happens when you sell products. You don't give consumers the best you have at the entry price. it just doesn't make any sense whatsoever from a business perspective.

And you're complaining about the 5400 RPM drive too....listen dude, seriously? It's.......f*** it, yeah Apple even including those in their Macs is pathetic.

 

[phrehdd]

I appreciate the discussion here and the very fact people are discussing it here implies at some level they are aware and savvy to the "Mac Universe." Unfortunately, the vast majority of people are not savvy and this is easily seen at any Apple Store.

In short, Apple can get away with this practice because the typical customer is ignorant. The typical customer just wants something pretty that works. If those people were more aware, perhaps the Apple stores would have maybe only half the volume of customers at any given time.

Let's face it, Apple has a market model that most of us find frustrating at times and it reaps in massive dollars with a bit of form over function being en vogue with the Apple bosses.

 

[theluggage]

but nowadays 16GB is unusable for all but users who solely use the stock apps

What you've got to ask yourself is: what proportion of users actually want a phone with email and maybe maps and the occasional snapshot? 16GB is fine for that - you can probably even squeeze in a copy of Angry Birds. I suspect that Apple sell a metric shedload of iPhones to such users.

the Plus model solely contains optical image stabilization

Now that is probably a question of space - OIS is going to need a more complex lens.

The new iMac continues this trend with a bottlenecking 5400rpm HDD in its base model

I agree that Apple are risking giving a bad impression like that - and I certainly wouldn't touch that HD with a bargepole, but then putting any sort of spinning rust in an iMac seems pointless to me, and a fusion drive is just doubling the chance of losing your data...

Given that they've skimped on the SSD in the 1TB Fusion drive they could have made that the entry.

However, maybe we're losing sight of something here:

The purpose of an 'entry level' model is to set the "From..." price on the website. Its the one that Apple can bulk-sell to Walmart at a hefty discount. Its the one that suppliers include in their bids for 'preferred supplier' status with large institutions (and then shaft them for the upgrades). The 16G iPhone is the one that the phone shops will offer on their 'free with contract' deal. Its the price tag that gets people in the door so you can up-sell them.

A more sensible 'entry level' iMac would have a 128GB SSD - plenty for a machine that just had to sit on a receptionists' desk (about the only use I can see for a 21.5" iMac anyway) or for anybody who was going to keep their media files on an external HD. But that wouldn't impress the punters sitting on the shelf next to an OwnBrand with 1TB without a salesperson to explain things, which ain't gonna happen in Walmart.

Welcome to capitalism. Maybe we'd be healthier and happier without it (that's one for the social/politics forums) but we'd probably be sitting behind our Apple ]][[b with 16 floppy drives and 1024x768 displays and marvelling how it was twice as fast as the 320x200 one we used in 1980 yet only cost $5,000. Instead we had 30 years of exponential growth funded by the ability of the PC industry to sell us a new computer every 18 months. What's changed is that, in the past, manufacturers haven't had to plan their planned obsolescence - specs were rising so fast that a 2-year-old PC felt like an antique. Now things have slowed down somewhat (and the demands of software have slowed even more). If Apple sold you a properly upgradeable Mac today (so you could get the entry model and customise it), you wouldn't be buying another one for 10 years. Heck, I could have my 2006 Mac Pro sitting up and begging if I could be bothered to chase down the right bits on eBay.

In case you hadn't noticed: Apple is about the only one still growing their PC sales - so they must be doing something right for Apple - especially since Microsoft has now decided to copy Apple and make their own premium-priced laptops. Since Apple could quite easily drop the Mac without wrecking their core iPhone business - and would do if it stopped making enough money to bankroll OS X and application development - you have to conclude that, unless you like Windows 10 or Linux, what is good for Apple is good for you.

So what's the alternative? I don't see the Asus Zen all-in-one in the shops yet, the Dell XPS all-in-ones have 4th-gen processors and 'mere' 1440p screens...

 

[benzslrpee]

i have two questions:

• which phone OEM in your opinion is not nickel-and-diming but is maintaining / making profit
• which PC OEM in your opinion is not nickel-and-diming but is maintaining / making profit

It's unfortunate to watch the world's largest company continuously move product lines over to a nickel-and-diming model that not only encourages up-charges, but necessitates them for an optimal experience. The most prominent product where this is apparent is the iPhone 6s: 16GB was fine when they originally made it the base model and for a few years after, but nowadays 16GB is unusable for all but users who solely use the stock apps so the jump to 64GB is necessary to not have to constantly deal with "storage full" notifications. Then, rather than boiling down to size preference for no reason other than to up-charge customers the Plus model solely contains optical image stabilization. So we're at at least $849 for the optimal iPhone experience.

The new iMac continues this trend with a bottlenecking 5400rpm HDD in its base model that ruins the entire experience. Apple doesn't even offer a 21.5" model with a Fusion Drive or SSD in its retail stores! Likely in an attempt to upsell to the 27" model, which is quickly becoming overkill for most consumers.

Frankly I'm satisfied with the Retina MacBook Pro offerings, which includes all or more than the average consumer needs in its base 15" model. Yet I'm worried this will change and Apple will continue the trend of bottlenecking products to get consumers to upgrade. Some may say this trend isn't new, but all base models thus far have been perfectly usable and not bottlenecked in a blatantly-purposeful way.

 

[Flow39]

I appreciate the discussion here and the very fact people are discussing it here implies at some level they are aware and savvy to the "Mac Universe." Unfortunately, the vast majority of people are not savvy and this is easily seen at any Apple Store.

In short, Apple can get away with this practice because the typical customer is ignorant. The typical customer just wants something pretty that works. If those people were more aware, perhaps the Apple stores would have maybe only half the volume of customers at any given time.

Let's face it, Apple has a market model that most of us find frustrating at times and it reaps in massive dollars with a bit of form over function being en vogue with the Apple bosses.

I've often wondered this myself. If consumers were more informed, how many would be hanging out at the Apple Store?

Most of the time I go in, all I see are people that ask the most dumb questions imaginable that would take one Google Search to find the answer. "I need a really good laptop that is fast for school. I'm going into the medical field. Would the MacBook or MacBook Pro be better?" "How do I right click on this $1500 computer that I have no idea how to use?" "How do I export a document to Word?" They also usually throw down an absurd amount of money on a product they know next to nothing about.

The amount of morons (not all users, especially not people here on MR, because you guys and gals actually know about the products) that buy Apple products amazes me. It's really no wonder Apple fans such as myself are classified as iSheep. Walk into an Apple Store and this will be going on all the time.

Apple really has started to nickel-and-dime people.

 

[BFaro]

Well written article on this very same topic:

http://9to5mac.com/2015/10/19/opinion-aapl-greedy-steve-jobs/

 

[AZhappyjack]

I appreciate the discussion here and the very fact people are discussing it here implies at some level they are aware and savvy to the "Mac Universe." Unfortunately, the vast majority of people are not savvy and this is easily seen at any Apple Store.

In short, Apple can get away with this practice because the typical customer is ignorant. The typical customer just wants something pretty that works. If those people were more aware, perhaps the Apple stores would have maybe only half the volume of customers at any given time.

Let's face it, Apple has a market model that most of us find frustrating at times and it reaps in massive dollars with a bit of form over function being en vogue with the Apple bosses.

To their credit, they are good at what they do. After all, the purpose of any enterprise is to make money for themselves and their shareholders. Don't get me wrong, as a consumer, I feel a bit hamstrung by some of their methods... but as a user who appreciates a well-designed device that does "just work" in > 95% of the time, I'm willing to pay the Apple tax... I just don't upgrade as often these days.

 

[McGiord]

It seems that they are just seeding a crop of apple customers to face the reality of a crippled Mac in a few years when they realize that it doesn't work well or as it used to be when it was new. When their planned obsolescence is activated either due to a hardware failure, or a new version of OS X or a functionality in one of the iDevices that only works when paired with the right OS or new Mac model, these customers will come back to the Apple store and get whatever the genius suggests them or enroll in the new apple leasing model for Macs.

I think that most of the market share growth that Apple had experienced is with the MacBooks.

It used to be 3 models: low cost good, mid tier better, high cost best.

Now it is something like: kind of affordable ripoff, expensive solid performance for next years, very expensive powerful (but not all of it - you still need to get another Apple device). And don't forget to pay for AppleCare, because without it you will need to dispose it after warranty, it's not user serviceable.

 

[ardchoille50]

They started the trend towards closed throwaway systems with limited but highly expensive upgrades. And they have continued perfecting it. The great dumbing down continues. Sadly, the competition is even worse except for MS in some ways, but then you have to deal with Windows. But hey no worries, coming are more Emojis and tighter Social Media integration.

Well, you're not exactly "stuck" using Windows. One of the first things I do when buying a Windiws machine is to wipe the HDD and install either Linux or BSD.

 

[phrehdd]

Well, you're not exactly "stuck" using Windows. One of the first things I do when buying a Windiws machine is to wipe the HDD and install either Linux or BSD.

I have a few friends that are Linux-heads and really are good at what they do. However, they all admit that OSX has a great interface and that Windows has the greatest flexibility when it comes to applications and drivers.

So far, I find Windows 7 an okay experience as a virtual within OSX and I leave it that way for the 3 apps I can't get with OSX. I have used Unix and Linux years ago and tempted to get back to it once I can figure out the application challenges. Btw, is there any GNOME like GUI that appears similar to OSX for Linux?

 

[ardchoille50]

Btw, is there any GNOME like GUI that appears similar to OSX for Linux?

The first thing you need to do is to be running gnome 2.x or the Mate desktop environment, gnome 3 is much more difficult to mimic OS X. Mate is a fork of gnome 2.x.

There are several dock applications that provide the dock similar to that of OS X, Cairo dock is popular for this. There are also plugins for gnome 2.x that turn a panel into something similar to the menu bar in OS X, AppMenu works great. There was also a project called GlobalMenu, but I'm not sure it's still around.

I wrote a bunch of gnome 2.x themes (search for ardchoille on gnome-look.org), which also work great in the Mate desktop, check out my ArdOSX themes.
Here is one I designed for use with GlobalMenu:



It's not exact, due to limitations in gnome, but it's very close to how OS X once appeared.

It's actually very easy to make gnome 2.x look like OS X and there are entire suites of themes dedicated to this.

Here is a screenshot (from July 2012) of my Acer Aspire netbook running Linux Mint and the Mate desktop with a custom theme that I wrote:



It is possible

 

[MICHAELSD]

The purpose of an 'entry level' model is to set the "From..." price on the website. Its the one that Apple can bulk-sell to Walmart at a hefty discount. Its the one that suppliers include in their bids for 'preferred supplier' status with large institutions (and then shaft them for the upgrades). The 16G iPhone is the one that the phone shops will offer on their 'free with contract' deal. Its the price tag that gets people in the door so you can up-sell them.

A more sensible 'entry level' iMac would have a 128GB SSD - plenty for a machine that just had to sit on a receptionists' desk (about the only use I can see for a 21.5" iMac anyway) or for anybody who was going to keep their media files on an external HD. But that wouldn't impress the punters sitting on the shelf next to an OwnBrand with 1TB without a salesperson to explain things, which ain't gonna happen in Walmart.

It's a reasonable point, although I don't think Walmart will nor do they carry the iMac. The base iMac models without a Retina Display have no issue as they are, but for the average consumer that wants to buy the base iMac Retina and wants to be wowed they may not even realize how antiquated a 5400rpm HDD is -- they should be able to buy an iMac and not worry about that type of bottleneck.

 

[theluggage]

The base iMac models without a Retina Display have no issue as they are, but for the average consumer that wants to buy the base iMac Retina and wants to be wowed they may not even realize how antiquated a 5400rpm HDD is -- they should be able to buy an iMac and not worry about that type of bottleneck.

The base iMac Retina will be the base iMac full stop in 6-12 months time.

Meanwhile, the only people buying a small-form-factor computer with spinning rust in it will be people who have never used a computer with a SSD, so possibly they won't notice. A 7200 RMP drive might be slightly better, but nothing like the night & day difference you see with a SSD. 256GB is enough for basic general computing - but if you can fill 1TB the chances are you can also fill 2TB or 3TB and you're going to be relying on external drives or NAS anyway.

 

[AZhappyjack]

It's a reasonable point, although I don't think Walmart will nor do they carry the iMac. The base iMac models without a Retina Display have no issue as they are, but for the average consumer that wants to buy the base iMac Retina and wants to be wowed they may not even realize how antiquated a 5400rpm HDD is -- they should be able to buy an iMac and not worry about that type of bottleneck.

I would argue that people who buy the base model iMac without investigating the details are people who, typically, aren't concerned about specs, don't understand specs, and to some degree, are technically ignorant. They want a Mac for whatever reason, but that's it. People who want or need an iMac for a specific purpose will do their homework and buy a machine whose specs match (or exceed) their needs.

I am not sure that this is necessarily a problem. Sure for an extra $200-300 you can get a more powerful (sometimes significantly more so) machine, but some buyers either don't understand or don't care. For example, 88 year old father is never going to worry about trying to edit and render 4k video.