Re: Reply to Phil
Originally posted by alameda20
I don't agree that Apple is agressively pricing the iPod. I think it is a fact that Apple has the highest margins in the industry.
As a corporation. PowerBooks and such are high-margin products. That doesn't preclude Apple from selling other products at low margins, such as the iPod.
Originally posted by alameda20
So my conclusion is that they are marking up the iPod significantly. I would certainly like to know how much it actually costs them to make. Might be an interesting thread on its own?
The actual hard drive is in the triple digits itself, under $200 but over $100. Add the firmware, R&D, hardware, industrial design, it's easy to add another hundred or two.
Originally posted by alameda20
Apples declining market share was in my opinion due to price. This is exactly my point about the Ipod and my point that I think Apple will repeat history with the Ipod.
You're seriously oversimplifying. Poor marketing, atrocious developer relations, and continual crises were very much a cause. Pinning it on price alone is oversimplifying. And even if overpricing was a factor, the iPod is not overpriced. It is not priced significantly above the competitors, especially on relation to the quality of the product.
Originally posted by alameda20
I don't think Apple is on a rising curve I think it is more like : If apple hadn't brought out a new OS and flat panel macs and Ipod they would be toast by now. I think Apple is just treading water and I think Apple needs to get its prices even further down. I don't think they can sit back and say "Hey our products are superior and that justfies the higher price". I think only a foolish person would take that stand and their histoy in the 90's I believe proves it.
Apple *is* on a rising curve. Market share is increasing, profits are increasing, product quality is increasing. Every since 1997, Apple has been resurgent. The turnaround was more or less complete by 1999, and from then on it was just growth and improvement.
Originally posted by alameda20
So my conclusion is that Apple is not really interested in market share, if it was interested in market share it would reduce it's margins to the industry norm.
You're right, Apple isn't excessively interested in market share. Not enough to cut back on quality and build crap just to sell for a low price. That's Dell's business model, not Apple's.
The reason Apple's market share declined can be pinned down to one reason: Microsoft Windows, and the agreement that Sculley signed granting Apple IP to Microsoft. That's not gonna happen with iPod.