Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.
Even if Apple does have more expenditures than the cost of the components themselves, Apple is sitting on 88 billion.

We know these phones are overpriced but we do not care. All phones are. Apple isn't the only one. We should care though.

True, but as long as they can evoke the desire in us to own their stuff, they will be able to make a profit.
 
Most other phones don't need to offer 32GB or 64GB of storage inside since they allow users to pop in a SD card to increase the stock storage. For the same $200 Apple charges for just a 48GB increase, other phone users could buy a pocketful of cards increasing their total space by over 148GB.

It's not a 1-to-1 comparison. SD memory is not as fast as NAND. Also, it's not possible to reach 64GB with a phone unless it comes with 32GB already (very few phones do) as microSDHC does not go beyond 32GB. If you want a fast 32GB micro SDHC card, you're looking at $60 and still not to the size of the 64GB iPhone.

Plus, there's definitely an added inconvenience of carrying and/or swapping cards.

Finally, many of the premium android phones are now being sold for $300 rather than $200 due to the inclusion of LTE. These phones don't come with more than 16GB built-in unless you count the Galaxy Nexus (not out yet). In regards to an LTE iPhone, when it comes, I don't think Apple will bump the price to $300. I would be most curious if it forces Verizon to price other LTE phones at $200 to compete.

I'm not saying $100 for each additional storage double is a 'good' deal, it's just not a clear loser to the replaceable card strategy. You have also to remember that WP7 phones don't even support SD cards. You get what is in the phone, that's it. That's usually only 16GB.
 
Last edited:
I'v always feel iphone is a much higher profit product compare to other lines, say ipad 2 probably cost them around $300 to produce because the cost of the larger screen, heck, even HP touchpad components cost around $300. So iphone is cheaper to build than ipad but priced more than an ipad.

If an ipod touch can be had for $200, why can't an iphone to be had for about $300 or so without a contract.
 
So, Apple Tax is real.

If people accepted it things would go smoother for sure. ALL their products have a premium. People make lots of excuses and basically try to say they make very little after R&D, storage costs, manufacturing costs etc.. Truth is one day if they get pushed in the premium PC market and the iDevices start to not sell well, the truth will come straight out.

Their stuff never sits on shelves for long though so any company in their position would do the same thing.

Defend that Mac Pro price and 17' MBP as well guys :p Those cases must cost a thousand bucks in your head.

Oh and the 3GS is $400 still....please.
 
Last edited:
Right now the 3GS is free...the notion that it didn't go down in price is pretty easy to disprove.
Free? You mean $450, which is the amount AT&T is subsidizing which goes straight to Apple? 450 is too much for a 2.5 year old phone. I won't blame Apple, I'll blame the retarded system you guys have there in the States.

Whoever is buying an iPhone 3GS right now from AT&T and thinking that it's free is an idiot.
 
Buying straight from apple is $375 unlocked, so not much different.

Free? You mean $450, which is the amount AT&T is subsidizing which goes straight to Apple? 450 is too much for a 2.5 year old phone. I won't blame Apple, I'll blame the retarded system you guys have there in the States.

Whoever is buying an iPhone 3GS right now from AT&T and thinking that it's free is an idiot.
 
Why are you using subsidized price and not the real price? Th 3gs is $400, and its almost 3 yrs old.
As for android phones, their components costs should be much higher than Apple's. It could be the higher spec that they're always showing off, or/and the fact that they get worse pricing because they deal in lower volumes.

they might hype CPU speed but they always go cheap somewhere else. the BOM's are similar across all the phones
 
So, Apple Tax is real.

Is it? The new android phones just announced are $299 with contract, probably similar component costs.

If an ipod touch can be had for $200, why can't an iphone to be had for about $300 or so without a contract.

That's the big question for me. Compared to the tech and cost of the touch, having even the 3GS at $375 unlocked seems out of wack.
 
the iphone carries more licensing costs that have to be paid along with the radio chips, cost of carrier certification, Siri and other costs

every iphone you have to pay samsung, moto, nokia and others who own the various mobile patents
 
If they want that much storage, they have to pay. Very few other phones offer 32GB of storage inside, much less 64GB. If it's that or nothing, some people may choose the extra cash. There's no alternative.


Also, manufacturing cost is estimated at $8, so that's not a huge chunk of the price. I wonder how much the cost would go up for apple to have it manufactured domestically.

Nobody wants that much internal storage. SD card does the exact same thing for a fraction of price. 16GB costs $200 on contract which is reasonable. $400 for 64GB is twice the cost of 16GB which is too much.
 
Free? You mean $450, which is the amount AT&T is subsidizing which goes straight to Apple?

Did you even read the post I was responding to? I was disputing the notion that Apple doesn't drop prices.

3GS is now free WITH CONTRACT. When it first shipped how much did it cost WITH CONTRACT?

3GS is now $375 without contract. When it first shipped how much did it cost without contract?

Either comparison proves my point, you just need to have the same with/without contract on both ends so it's an apples to apples comparison.
 
Nobody wants that much internal storage. SD card does the exact same thing for a fraction of price. 16GB costs $200 on contract which is reasonable. $400 for 64GB is twice the cost of 16GB which is too much.

I think I'll let the market speak rather than take your opinion of what the market wants.
 
they might hype CPU speed but they always go cheap somewhere else. the BOM's are similar across all the phones
The phones that are $200+ with contract are their high end model, with the latest and greatest components for a phone.
 
re: Wow

Wow, people exist who still haven't realized that the iPhones don't have sockets for memory upgrades?

Yes, we're well AWARE that the additional memory isn't worth the higher prices of the larger-capacity iPhones (or iPads for that matter) -- but the usefulness of having that extra storage capacity often makes it worth buying, since there's no other feasible option. (Or do YOU offer a very inexpensive service where we can mail in our iPhones or iPads to have upgraded RAM soldered in?)


.
Wow, people who buy 32gb and especially 64gb are not smart. They pay $100 or $200 more for same phone but extra memory only cost like $10. These peoples not good at math apparently and buy rip off model. Ha. :eek::confused::apple:
 
WOW! they are making a lot of money.. But keep in mind they have to pay all that rent for stores and factories, to pay all the employees...

Lol they don't pay their employees anything.

----------

(Or do YOU offer a very inexpensive service where we can mail in our iPhones or iPads to have upgraded RAM soldered in?)

This actually wouldn't be that hard.
 
re: Android

Yep... and on top of that? Android phones often have apps which refuse to allow storing/running them entirely from the SD card, so they HAVE to occupy some of that limited 16GB of RAM they usually come with.

Right now, I've got an HTC Evo 4G sitting here with a "low storage space" warning constantly on the display for this very reason. The SD card in it still has about 8GB of free space, but I can't install another app because there's not even enough free internal RAM to download/uncompress another app before it copies to the SD card - even IF it's an app that will ultimately run from one.


Just for comparison, what are the two prices for the 16/32 gig versions of a typical Android phone? How much more for the extra space? And how many 64 gig Android phones are available?

I guess some have options for adding cards, so that's another variable.
 
These component cost analysis articles are ridiculous. Let's point out some obvious omissions:

1. Apple has to order these parts in the MILLIONS to get this pricing
2. No cost of software development or installation is mentioned
3. No cost of packaging or shipment destination charges included
4. No cost for assembly included in these estimates
5. No cost for DC warehousing included


That doesn't even start to include paying the tens of thousands of employees a salary, paying for retail space, marketing the product, etc.

Well that doesn't make the articles ridiculous. They say that they're explicitly looking at the cost of the hardware components themselves, nothing more and nothing less, so it isn't like they're misrepresenting anything here. These articles are interesting, and useful providing you understand what they represent and (as you point out) what they do not.

The authors of those articles don't pretend for one moment that the cost of the components is what the cost of the phone should be. Only stupid people think that.
 
The estimates do not include other costs involved in product development, manufacturing, and sales, such as research and development, software, patent licenses, marketing, and distribution expenditures.

Well there you go.
 
ipad has these costs, why the latest iphone is always more expensive (650 vs 500) than the ipad.
 
If that is true (64GB pricing) I see no reason for AT&T to say I still owe them money on a phone I paid $650. I still needed a 2-year contract to cover cost of the phone to them from Apple. Even if I doubled the price of the cost of the phone@$254, that's still $508 and I paid $650. Someone is lying when it comes to subsidy(sp) pricing.
 
Thank you for personal insult. Sorry I only speak 3 languages but not perfectly.

With iCloud and iTunes match and other streaming of media, the decision to pay for more memory is more silly.

If Apple wanted, they can make 32gb the low end and put more pressure on android makers with little effect on margin. But you do not see this. Surprise.

I took the people who buy 32gb and 64gb are not smart as an insult too so it was a tongue in cheek comment. There are hundreds of other products in the marketplace that follow this pricing strategy. I could say people who buy fully loaded version of a car over a base model are not smart. To each is own and what is important to one is not important to another.

It is called perceived value. The market determines the price.
 
ipad has these costs, why the latest iphone is always more expensive (650 vs 500) than the ipad.

Because the iPad cannot be subsidized by carriers and has a different usage model (few want a contract with a tablet). Phones are subsidized because the manufacturers can get carriers to do it. Clearly, carriers need good phones in order for their network to succeed, not just a reliable network and good customer service. Phone manufacturers know that and carriers are happy to get customers in a contract by subsidizing phone costs to mitigate customer churn.

When you look at iPad numbers, apple clearly has a healthy margin there too, but when you look at iPhone numbers and just how much of Apple's profit it makes up, it becomes apparent they are an extremely high margin product.
 
Register on MacRumors! This sidebar will go away, and you'll see fewer ads.