In addition to what the others have said about R&D, salaries and wages of employees, marketing, programmers etc, don't forget that this is a bulk ordering cost. There's no way that you'd be able to buy every component in an iPhone for $247 if you went to the factories and ordered every part in an iPhone.
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Apple Reopens Russian Online Store With 35 Percent iPhone Price Increase
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In addition to what the others have said about R&D, salaries and wages of employees, marketing, programmers etc, don't forget that this is a bulk ordering cost. There's no way that you'd be able to buy every component in an iPhone for $247 if you went to the factories and ordered every part in an iPhone.
I think the trouble with Russian prices is this:
1. Apple adjusted its prices twice over fairly short period of time (less than one month, was it?). Other brands did not, or not quite as much (I think Samsung went for 20% raise on Dec.16th but that was it).
2. Apple did not, however, adjust the prices in Russian App Store when they raised the hardware prices, and we enjoyed USD1=RUB33 ratio up until very recently. However, right before the seasonal sale the App Store rate went up almost twice, to 62 RUB per USD Christmas spirit? Bah! Humbug!
3. Although RUB has been on the decline since October and plummeted to 72 RUB per USD or so last Thursday, it seems to be going up now - I think it's about 52 today. There are rumors that the whole collapse thing was in fact a scam (I won't go into that now, neither do I entirely believe it). While it might still plummet in the coming days or early next year, there's a good chance it will stabilize around 45 or 50. If it does, Apple products and services would end up being overpriced unless they put the prices down. Will they do so? Unlikely.
Speaking of App Store prices, I was kind of looking forward to Christmas sales, but now I end up having to pay a near-20% margin to the dollar price in the Russian store - which is somewhat of a bummer. Should've been smarter and paid the full price before the App Store rates went up (the dollar was higher too then).
1. Apple adjusted its prices twice over fairly short period of time (less than one month, was it?). Other brands did not, or not quite as much (I think Samsung went for 20% raise on Dec.16th but that was it).
2. Apple did not, however, adjust the prices in Russian App Store when they raised the hardware prices, and we enjoyed USD1=RUB33 ratio up until very recently. However, right before the seasonal sale the App Store rate went up almost twice, to 62 RUB per USD Christmas spirit? Bah! Humbug!
3. Although RUB has been on the decline since October and plummeted to 72 RUB per USD or so last Thursday, it seems to be going up now - I think it's about 52 today. There are rumors that the whole collapse thing was in fact a scam (I won't go into that now, neither do I entirely believe it). While it might still plummet in the coming days or early next year, there's a good chance it will stabilize around 45 or 50. If it does, Apple products and services would end up being overpriced unless they put the prices down. Will they do so? Unlikely.
Speaking of App Store prices, I was kind of looking forward to Christmas sales, but now I end up having to pay a near-20% margin to the dollar price in the Russian store - which is somewhat of a bummer. Should've been smarter and paid the full price before the App Store rates went up (the dollar was higher too then).
It's because of inflation. Also, every company prices their products right to make the most profit, and higher prices aren't always more profitable.
Learn some programming and work for banks or software companies. Programmer get paid a lot.
I know there are jobs that pay. Thing is I wouldnt mind betting that the average persons weekly paycheque will not stretch to an iPhone. Not in the Uk if youre looking for a 6 thats for sure.
Mind you a 5C .
5C @ 319 = about £21K gross pa.
6+ @ £619 = about £43K gross pa.
How about design and engineering? Research and development? Oh right, that's free! You simpletons have no idea what it takes to bring a product to market. What cost $247 is the material and the manpower to put it together. I'd love it if you went out there and got the components, write your own software and piece together your own smartphone and sell it for $247, and it better be better than good, and ship world-wide and offer warranty and constantly updated.
Bare in mind, I've given you a pass on designing your own smartphone and you still wouldn't be able to get it to market at that price.
Funny, Apple pays more taxes by percentage than any other US corporation. That doesn't sound greedy...and certainly doesn't sound like they're evading taxes like no tomorrow.
Very high price, but...
Wow, and even then it doesn't get close to the prices in Brazil! The cheapest iPhone 6 here costs around US$ 1200-1300 (16GB iPhone 6, converted from Br Real).
Damn crazy import taxes...
Wow, and even then it doesn't get close to the prices in Brazil! The cheapest iPhone 6 here costs around US$ 1200-1300 (16GB iPhone 6, converted from Br Real).
Damn crazy import taxes...
It's possible but I doubt that would happen as quickly as something like this. If these companies didn't raise prices, we'd all start importing products from Russia to get great deals.
I know what you're trying to get at, but no company has any obligation to raise salaries based on the value of your currency...
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Wow, and even then it doesn't get close to the prices in Brazil! The cheapest iPhone 6 here costs around US$ 1200-1300 (16GB iPhone 6, converted from Br Real).
Damn crazy import taxes...
The price didn't go up, are people missing the most basic math here? The price of the phone stayed the same after this adjustment, the value of the money changed.
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And there's the winner. Don't be mad at companies who refuse to give away their products at half price because of the value of the Ruble and accuse them of being greedy...they're not charities. If you want to see greed, go see who made out on the value of the Ruble dropping in Russia, take a look at the poor leadership, ask Ukraine what greed really is...
Although this is to be expected.
You can be sure as hell Apple wouldn't do the same to US prices if the $US fell through the floor. They'd put the prices up across the rest of the world to cover any loses.
That is what always f***s everyone outside of the US off.
You can be sure as hell Apple wouldn't do the same to US prices if the $US fell through the floor. They'd put the prices up across the rest of the world to cover any loses.
That is what always f***s everyone outside of the US off.
If the $ dropped, the corresponding response would be to DROP prices across the rest of the world. Not that they would actually do that.
I do love your classic strawman argument, though. That's right, condemn Apple for something that happened only in your own mind.
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I don't know what deserted island you've been living on the past five years, but you should read the news once in a while. Apple pays a 30.5% rate on revenues they report as being generated in the USA. However, they pay 1.9% on revenues they report as outside the USA, which results in a miniscule rate under 10%. Apple is known to use every trick in the book to shift revenue, on paper, to low-tax zones where they are doing relatively little real business. For example, a trick used by Apple (and others) is to assign patents (on stuff developed in Cupertino) to a subsidiary in a low-tax zone, and have that subsidiary charge the rest of Apple royalties on those patents. Then there's the infamous "Double Irish With a Dutch Sandwich," which routes profits through their Irish, then onto their Dutch, then back to the Irish subsidiaries, and then to the Caribbean.
They are doing nothing illegal, and personally I have nothing against them doing everything they can to maximize profit. But your statement is simply wrong. Actually, Walmart's effective tax rate is nearly three times as high as Apple's (and I hate Walmart).
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A lot of people are missing the basic economic fact that Apple lives in a competitive marketplace, both for product prices and retaining employees. Apple will be raising employee salaries if everyone else is, because they need to do so to keep their employees. Apple can't raise their product prices if no one else is, because they will price themselves out of the market.
Econ 101
What happens if it suddleny flexes again and drops 6%? That's quite a low tolerance!
And that's just computers and phones.
Prices of everything in Russia are going to go up because of the ruble going down the toilet. Cars, food, household appliances, furniture, etc. Basically anything imported from a foreign country, or built in Russia with parts imported from a foreign country, is going to see it's price increase drastically. It's not a good time to be a Russian right now.
For those who don't get it or are still calling Apple greedy - pretend I build a widget that I sell for $20 USD. You want to buy it, but you do not have $20, instead, you offer 5 gallons of gas that you have in a gas can in your garage. This is over the summer when gas is $4/gallon, and I need gas in my car. I make the exchange because I'm getting $20 worth of something instead - and if you gave me a 20 dollar bill, I'd go directly to the gas station anyway to fill my tank.
Now, pretend it's today. I still have a widget that I sell for $20. You still have 5 gallons of gas to offer me instead of cash. With gas at $2/gallon, would I make that trade? Hell no. And neither would you if you were me. I still need $20, or now 10 gallons of gas.
If it's not obvious, I am Apple. The widget is the iPhone. The gas is the ruble. That's why they raised prices in Russia.
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I'm guessing that $1.4 trillion is the GDP of Russia (which as of 2013 was 2.xx).
And, as you say, it can't be compared to the value of a company. There was an article in a business newspaper about this some weeks ago when people started saying that Apple was more valuable than some countries.
The GDP is what a country produces in one year. The value of Apple is much higher than what they produce in one year, which is around $120B (and I suppose this value should be smaller if we are really trying to compare it to a countries GDP, but I'm no expert in this topics =)).
A lot of companies have stopped selling in Russia, or at least stopped selling in roubles. Ikea has stopped selling certain products, the VW group have stopped selling their cars in roubles, the list goes on and on.
By the time the world gets done with the Russians their currency won't be worth spit. Reap what you sow.
Indeed. It should work both ways though - but for some reason it often doesn't. The prices go up and stay put, even if local currency bounces back.
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