Apple is anti free market?

Discussion in 'iPhone' started by mark28, Dec 5, 2011.

  1. mark28 macrumors 68000

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    Jan 29, 2010
    #1
    So I went shopping for an iPhone 4S. I was quiet surprised how none of the providers would give me special deals, because they weren't allowed by Apple? :confused:

    How is this allowed that Apple is placing restrictions on what the telecom providers can do in a free market?

    At first, I was 100% set on getting an iPhone 4S. But after recieving special deals for the new Samsung Galaxy Prime at the fraction of the price of an iPhone 4S, I'm really starting to doubt. ( it's really tiny and underspecced so no idea where this massive price difference comes from besides Apple fixing the prices ).

    Apple is lucky that I really don't like the current Android 2.3.3 I tried on the Samsung Galaxy S2. So if ICS 4.0 on the Samsung Nexus Prime is just as bad as 2.3.3, I'll just suck it up and just buy the iPhone 4S at the fixed price. :(
     
  2. tardman91 macrumors 6502a

    tardman91

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    #2
    It's simple. Apple tells retailers that they can't sell their products below a price of $XXX.XX. If the retailer wants to sell Apple products, they agree. If not, they don't sell them. That is why a lot of places will bundle gift cards with iPods and such around the holidays. They can't lower the price, but they can make it more attractive to buyers that way. This is not an uncommon practice.
     
  3. Jordan921 macrumors 68040

    Jordan921

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    #3
    Apple has never given any deals on their current iPhone. This shouldn't be new news to anyone.
     
  4. likethesoup2 macrumors 6502a

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    Orlando, Florida
    #4
    Apparently it is to him.

    To the OP: the reason Apple doesn't give deals on the new iphone is really simple -- they don't have to.

    Additionally, how, exactly, does that make Apple 'anti free market'?
     
  5. ET iPhone Home macrumors 68040

    ET iPhone Home

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    #5
    In few cases, I'm actually in favor of it. It maintains the integrity of the product. Therefore, the resale value is much higher than those phones given discounts IMO.
     
  6. Small White Car macrumors G4

    Small White Car

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    Washington DC
    #6
    Back at ya' the other way: What makes you think there's anything wrong with this?

    All you've told us is that it surprised you. But what's the actual problem here?
     
  7. Interstella5555 macrumors 603

    Interstella5555

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    #7
    That IS free market, they can pick whatever price they want, and sell it at that price. Consumers are more than free to choose something else if they want.
     
  8. likethesoup2 macrumors 6502a

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    #8
    Thank you. That's the point I was going to make to him when I asked how what he described was anti free market.
     
  9. scaredpoet macrumors 604

    scaredpoet

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    Apr 6, 2007
    #9
    No, they're not lucky: they know they have a product that people are willing to buy, and thus they are charging what the market will bear. This is the epitome of a free market.

    Right now, people are buying iPhones faster than they can be made. Another tenet of supply and demand states that high demand and low supply tends to lead to increased prices. Consequently, Apple doesn't need to discount their products. They have named a price, and people are still lining up to buy them.

    Actually... if you wanted to be a real purist about this, then technically you're right: Apple is anti-free-market because they are artificially deflating the price of their phones through subsidies and not letting the market truly dictate the price.

    If you truly want to buy an iPhone 4S at the "free market" price, you're welcome to do so. There are places where people are selling the 4S at as high a price as the market will pay for them, and not at prices controlled or dictated by Apple. There, the White 16GB 4S, for instance is going at the free-market price of US $750+, which is at least $100 over the "imposed" Apple retail price on an unlocked model.

    So there you go. You're welcome to go all freaky-deeky free-market on them and buy your iPhone 4S, and thumb your nose at Apple. How dare they try to inhibit capitalism!
     
  10. asleep macrumors 68040

    asleep

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    Sep 26, 2007
    #10
    iPhones are really worth about $1,000.00 each...

    Feel better?
     
  11. mark28 thread starter macrumors 68000

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    Jan 29, 2010
    #11
    The group of sellers ( telecom providers ) are controlled by Apple to sell a product at fixed prices it seems, because they aren't allowed to enter into special deals, leading to more profits and higher prices for the customers. I don't call that free markets at work.
     
  12. Certinfy macrumors 6502a

    Certinfy

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    #12
    Doesn't really make sense because here in the UK as well as other countries you can get the iPhone 4S 16GB free on even £35 contracts. From using a converter online that's just under $55, and from what I've read on these forums Americans are paying a lot more per month than that as well as the $199+ for the phone. :confused:
     
  13. BlaqkAudio macrumors 6502

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    New York
    #13
    http://en.wikipedia.org/wiki/Free_market

    I don't see where Apple deviates from a free market. Demand is high, so they set the price high.
     
  14. SporkLover macrumors 6502

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    Nov 8, 2011
    #14
    They don't want re-sellers undercutting each other to push more iPhones, undercutting the Value of the overall iPhone brand.

    Let's look at Android phones. Typical high end phone costs $600 off contract, 199 on contract. In one to two months, you can expect the phones to be cut to 99 on contract. In 6 Months you might find it for 1 Penny on Contract on amazon. Some of those timelines are a bit of an exaggeration, but it does happen. If you are buying an Android phone, never early adopt, because it will surely be cheaper within a reasonable window. Those price drops also kill the resale market, overall driving down perceived value of the brand (I.E if outlets discount the prices so quickly and so often, must not be worth the original contract subsidized pricing).

    Not even the walmart effect will lower Apple's pricing much.
     
  15. haruhiko macrumors 68040

    haruhiko

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    Sep 29, 2009
    #15
    Can you buy other phones?
    If yes, Apple is not against free market.

    Every manufacturer has a suggested or mandated retail price.
    Even if Apple does not require them to sell above $XXX, they will not give you any bargain (unless it's a subsidized cellular plan)... they don't need to!
     
  16. lordofthereef macrumors G4

    lordofthereef

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    Boston, MA
    #16
    I believe what the OP is thinking about is price fixing, which is indeed illegal. A company cannot ADVERTISE their prices as lower. They can certainly actually SELL it to you as lower. They can also throw in whatever other perks they want, even if those perks are in the form of gift cards. The reason this is done is so that the smaller company isn't automatically beat out by the larger company. This is practiced by plenty of manufacturers, especially in niche markets. I am more in tune with the aquarium industry as far as pricing is concerned than any other market, and they have quite a bit of this.

    Here's the kicker. No company wants to sell the phone cheaper because they don't have to. It's guaranteed to sell! if you don't buy it, the next guy through the door will!
     
  17. aziatiklover macrumors 68030

    aziatiklover

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    #17
    that's because ya have tons and tons of carriers to choose from! We on the other hand have greedy and not much to choose from as carrier! Verizon and sprint are on cdma, then you have the only gsm carrier that have the 3g band working which is att! see make sense not much of choices here.
     
  18. stormchaser macrumors 6502

    stormchaser

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    #18
    Wirelessly posted (Mozilla/5.0 (iPhone; CPU iPhone OS 5_0_1 like Mac OS X) AppleWebKit/534.46 (KHTML, like Gecko) Version/5.1 Mobile/9A405 Safari/7534.48.3)

    4s 16gb for £35 a month yes no doubt if you give them £289+ deposit first.
     
  19. jeffg819 macrumors regular

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    Dec 25, 2006
    #19
    Seriously? Is Apple stopping the carriers from offering other phones? Is Apple forcing people into their stores and holding a large stick to their heads in order to get them to buy the phone at the price set? Do you think the government should step in and set a "fair" price?

    Free markets mean the people making the stuff get to pick the price they will accept for the product and to make it part of the contract for the stores that are carrying their product to not deviate from that price.

    And then people that are looking for that particular product get to decide whether they think it’s a good deal. If enough people do, profits! If nobody does, no happy ending for the people making the stuff. That's about as free as it gets.
     
  20. SporkLover macrumors 6502

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    Nov 8, 2011
    #20
    Not necessarily. Horizontal price fixing is illegal (price fixing amongst competitors). An example of this is when all music labels more or less agreed to sell CDs at a fixed price, rather than letting the market set the price.

    What apple does is vertical price fixing, which is legal. It is also called price maintenance. This isn't illegal because consumers can still choose to go to another manufacturer if they don't want to pay apples prices for a smart phone.

    Horizontal price fixing is overtly anti-competitive.

    ----------

    In general, in the UK you can't fix prices. That's why you can get it at steep discounts. Apple does have the option of selling less product in the UK if they aren't happy with the pricing arrangements.
     
  21. s15119 macrumors 65816

    s15119

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    Nov 20, 2010
    #21


    You don't seem to understand the concept of a free market
     
  22. Shrink macrumors G3

    Shrink

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    Location:
    New England, USA
    #22
    Be assured that Apple is not the only company that sets a price and does not allow the seller to alter it in any way. There are many companies that do not allow sellers to offer their product at a reduced price. I can think of one at the moment - the mattress maker Tempur Pedic does not allow any price reductions on their products.

    I'm not clear what this has to do with "free market". A producer may set any price they wish on their product and requiring vendors to sell at that price. They may lose sales that way, but that is the producer's business. Not getting a product at a reduced price in no way restricts a "free market". There is nothing in the "free market" economic concept that requires producers to allow vendors to lower their prices.
     
  23. Applejuiced macrumors Westmere

    Applejuiced

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    Location:
    At the iPhone hacks section.
    #23
    I agree.
    That's exactly what free market is.
    You set your own price, people make the choice to buy it or not.

    That's why I went with a Bob-o-pedic:D
     
  24. famoussasjohn, Dec 5, 2011
    Last edited: Dec 5, 2011

    famoussasjohn macrumors 6502a

    famoussasjohn

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    #24
    The stores don't make much of a profit off any Apple products really. From what I've heard when I was working at best buy, they would make maybe 10-20$ and would push accessories and warranties to make some money off the sale. We would never be able to offer a discount on ANY apple product..

    why are you acting like a cheap-o? iPhone 4S is $199, $299, $399 with a 2 year agreement, those are great prices for what you get. What other phone offers 64GB out of the box? None. What other phones offer 32GB without purchasing a microSD? None. How about 16GB? Very few..and are usually the same price or more. Apple isn't forcing you to buy anything, you as the consumer should be able to make your own decisions on what you want to buy, if you want to buy something you don't want at a cheaper rate, then go ahead, Apple isn't going to be hurt by it. They make a great product and there will always be someone that will buy their products. To you it may be "underspecced" but to others it's a phone that does a whole lot of other things great just like any other Smartphone.
     
  25. Gathomblipoob macrumors 68040

    Gathomblipoob

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    Mar 18, 2009
    #25
    I guess to some, the term "free market" equates to "sense of entitlement." :D
     

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