That is because the phone is subsidised.
By the time your 2 year contact is up, you will have paid the full cost of the handset.
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Apple's Share of Cellphone Industry Profit Estimated at 32% for First Half of 2009
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That is because the phone is subsidised.
By the time your 2 year contact is up, you will have paid the full cost of the handset.
No way, are you serious??? Just like every other handset on the market???
I'm not sure who the gripers are defending. It can't be the consumer, since the consumer pays the same price for the iPhone as for any equivalent competitor's device. And it can't be the carrier, as they are all raking us over the coals with their equivalently-outrageous fees (exception: Sprint, who offers bargain pricing because it is desperate to retain/attract customers). And they certainly aren't defending Apple.
Who exactly is the downtrodden here? Who is the victim of Apple's success?
It baffles me the inability to grasp the simple concept that APPLE IS MORE PROFITABLE BECAUSE THEY DO NOT CREATE OR SELL PRODUCTS TO COMPETE AT LESS PROFITABLE PRICE POINTS.
Seriously people, figure it out. Does everyone in the world have to model their business after Dell (AidenShaw's personal fan favorite) or Walmart to gain your approval?
Oh wait, Walmart sells at bargain-basement prices, yet activists hate them too...
There's just no winning in the business world for some of you I suppose.
An important test for a monopoly is that you conveniently left out (and the link doesn't seem to work): How difficult is it to enter the market? Since Apple is absolutely new in the market (is it even two years? ) and has this strong position, that seems to be strong evidence that there is not a monopoly at all, but just a bunch of fat, old, lazy companies sitting on their arses instead of competing, and one newcomer taking all their toys away.
There is no question that another innovative competitor with new ideas could enter this market easily. Who could that be? WiiPhone anyone?
You're right about that. The more phones proliferate to competing carriers, the less incentive for carriers to come out of pocket for the exclusive. Consumers benefit because carriers then have to compete in areas besides device, but on service and price.
A lot of first generation carriers like O2 did this and experienced lackluster sales because of high pricing and poor coverage.
Kudos to Apple. I dumped my 3G for a Bold, but i am sure I am in the minority. Everyone in NYC has one or the other
You can scale the hardware down to those lower points and maintain your margins. I guess Apple doesn't want to see a Pentium-Dual Core or T6xxx in a Mac though.
Starting high from the start on Yonah instead of Merom/Conroe really limited the chances for anything under $1,000.
No way, are you serious??? Just like every other handset on the market???
Hence, the average cost is $686.
If what you are saying is really true, then why did Apple try and sign exclusive wireless carrier contracts in every single country? To get less or equal subsidy? No......to get more!
You conveniently ignored one of the last slides about substitutes:
Where,
So, now it seems you are forced to argue that there are few substitutes and their sales are relatively small.
Customers, in a free market, usually buy the product that offers them the best value for their cash in their opinion.
So, no, if you had a choice of phones, and the other products didn't measure up, you didn't overpay for an iPhone. You would have overpaid if you bought something less valuable to you from these other less profitable companies.
Companies that don't put a lot of money in the bank for future R&D are the ones at risk when customers tastes change and those companies don't have enough R&D funds to invest in new products to meet those changing tastes.
Of course. And now that Apple has the de facto must-have gadget on the market that everyone is trying to emulate, it would seem they have the ability to leverage that demand into similar subsidies with other carriers, even without exclusivity.
They've played their hand brilliantly. That's called good business.
I've seen these same gripes about iPod pricing, yet equivalent Zunes cost the same. Go figure.
The Reality Distortion Field works on both polarities it seems.
It's only exclusive in three countries. The USA, the UK & Germany.
And some good news, it won't be exclusive in the UK for much longer.
i'm glad to see that there appears to be more people in this thread, than have appeared in others, that understand the differences and delicate balances between market share, revenues, profits, and margins.
yes, im happy to see that apple is making a huge profit. as i recall, part of that money (2 iphones specifically) used to belong to me. im glad to see that apple is being good stewards of the money i gave them and turning it into more money. i would be more angry to see that they had wasted it.
keep up the good work apple. if more companies were operating with sustained profitability like you are, we'd not be seeing all these government bailouts and layoffs.
yes, im happy to see that apple is making a huge profit. as i recall, part of that money (2 iphones specifically) used to belong to me. im glad to see that apple is being good stewards of the money i gave them and turning it into more money. i would be more angry to see that they had wasted it.
keep up the good work apple. if more companies were operating with sustained profitability like you are, we'd not be seeing all these government bailouts and layoffs.
I'm still waiting for the announcement on Dell's Cash For Clunkers program, where you can turn in crappy Dells with Windows Vista for big rebates on crappy Dells with Windows 7.
(Uh oh, I mentioned both Dell and Windows in a single post - that should trigger AidenShaw's automated alert system...)
AidenShaw charges extra for links that work.
Try upgrading to a browser that handles canonical escape sequences.
Does that mean we are over paying for the iPhone???
No, it doesn't. Looking at the sales-figures of the iPhone, people are more than willing to pay the asked price. And it seems that iPhone has superior customer-satisfaction, so you can't really say that we are paying "too much".
It's quite simple really: price of a product is determined by what people are willing to pay for it. And people are willing to pay extra for an iPhone.
The thing is that the production-costs of iPhone are probably comparable to some other hi-end phones, maybe even lower. R&D-expenses are also probably similar. You might spend millions on R&D and still end up with poor product. Apple spends similar amount on R&D, but since they have better designers and better idea what a good product is, the end result is a better product. Even though their costs are similar.
To make a comparison: iPhone is a CD-player, those other phones are cassette-players. Now, what would happen if some company invested 500 million to design an ultimate CD-player, whereas some other company invested 500 million on an ultimate cassette-player? The CD-player would be better. Sure, the cassette-player might be very impressive on several levels, but since it would since be based on crappy technology and wrong assumptions, it would still suck. Yet, both products would cost roughly the same.
Same thing here: We have phones based on Symbian (crap) or WinMo (even worse crap). No matter how much money they spend on R&D, the end product would still be crap, and they have to sell their products at a low price just so someone actually wants to buy them. Apple spends similar amount of money, but their product is so good that they can afford to ask for more money, because people are willing to pay more for superior product.
In short: No, we are not being overcharged for the iPhone.
I'm sure you have a favorite you'd like to recommend?
Seriously Shaw, if you're going to astroturf, at least have the dignity of providing full disclosure.
Cut the crap dude. Company with around 10% market-share is NOT in any shape or form a monopoly! Everybody with a working brain understands that!
It doesn't work in IE to begin with.I'm sure you have a favorite you'd like to recommend?
Seriously Shaw, if you're going to astroturf, at least have the dignity of providing full disclosure.
"%2520" in the link was the standout cause of the problem. Offhand % and a space?
why don't you try using industry standard principles for the naming of files, that involve not using special characters or spaces in filenames that are intended for the web.
