iPhone Average Selling Price Remains Steady Even With Free 3GS Offer

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Earlier this week, Apple reported its best quarterly earnings ever, taking in more than $46 billion over three months. 53% of that revenue was from the sale of 37 million iPhones, at an average selling price of nearly $660. This ASP is particularly impressive, considering this is the first quarter that Apple has sold a "free" iPhone in the U.S. -- the iPhone 3GS is available for free to new two-year contract signers on AT&T.




Apple's iPhone ASP has remained fairly consistent, hovering between $622 and $660 for most of the phone's lifespan. With Apple offering their cheapest iPhones yet this quarter, some analysts wondered if that would have a negative effect on the iPhone's ASP. It seems that demand for the 64GB iPhone 4S -- the most expensive iPhone yet at $849 -- has easily offset the cheaper iPhone 3GS and 4 models.




All Things D reports estimates from Consumer Intelligence Research Partners that claim 89% of iPhone purchases in the U.S. were for the iPhone 4S, with only 4% of buyers choosing the iPhone 3GS. More relevant for the discussion above, CIRP estimates that higher-end 4S models sold particularly well, with 21% of 4S purchasers opting for the 64GB model and 34% picking up the 32GB.

Article Link: iPhone Average Selling Price Remains Steady Even With Free 3GS Offer
 

AJH1993

macrumors regular
Oct 26, 2011
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0
I think it's great how well the 4S sold, especially since iPhone 4 owners are most likely still in contract. As an Android user, I am pretty impressed with the 4S(Camera, build quality, etc.) Might even consider asking my employer for the 4S. Well done, Apple.

I think the iPhone sells well because it can be recognized as a device similar to the iPod, and it has the Apple brand. While us on here just love the product, people not familiar with Android or Windows Phone turn to Apple because they're well-recognized
 

ForzaJuve

macrumors member
Jul 20, 2009
67
3
Hard to resist

It's hard to resist buying the 4S even if there is an older version for free available. That may also explain why people would rather buy an iPhone versus another brand (possibly cheaper) smartphone. The iPhone 4S remains the top of the line within and between brands.

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6 year-old daughter, 3 year-old daughter, babygirl 3 to arrive in April 2012. These are my real most valued possessions.
 
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paul4339

macrumors 65816
Sep 14, 2009
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amazing, since pundits initially claimed that the iPhone wouldn't sell at such a high price!

.
 

Chupa Chupa

macrumors G5
Jul 16, 2002
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amazing, since pundits initially claimed that the iPhone wouldn't sell at such a high price!

.
Well in all honestly, the original iPhone which was sold @ $499 and $599 did not sell all that well after the initial launch. It was only when Apple dropped the price a couple months after launch that sales started to ramp up. If Apple (Steve Jobs) had been obstinate on price the iPhone may not be the Smartphone leader it is today, but I think Jobs learned that lesson w/ the Cube.
 

Doctor Q

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Sep 19, 2002
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Consumers apparently favor the latest features over discounts. I'm surprised it's so lopsided toward the iPhone 4s, but perhaps I shouldn't be.
 

SPEEDwithJJ

macrumors 65816
Nov 2, 2008
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Well in all honestly, the original iPhone which was sold @ $499 and $599 did not sell all that well after the initial launch. It was only when Apple dropped the price a couple months after launch that sales started to ramp up. If Apple (Steve Jobs) had been obstinate on price the iPhone may not be the Smartphone leader it is today, but I think Jobs learned that lesson w/ the Cube.
I think a lot of that depends on the buyer. For me, I paid about $1,025 for my unlocked 64GB iPhone 4S with AppleCare+ here in the U.S. Will I do it again, I'm sure I would. With the amount of apps (& growing) that I have, the iPhone is without a doubt the ONLY choice I have when buying a new phone.

I also think that the pricing at first launch with the original iPhone was too high & did not sell well simply because it is a completely "new" product. Most people were so used to a simple phone back in 2007 as people are accustomed to getting a decent cell phone for free on a cell phone contract. IMHO, the initial price then was a shocker. However, nowadays, more & more people get to appreciate the "true value" smartphones bring though the use of apps & with the largest & still growing number of apps offering that can be found in Apple's app store, I even humbly think that if pricing for an base model iPhone starts at $499 (on a contract) today, they will still sell like hotcakes!
 
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Consultant

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Jun 27, 2007
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I think a lot of that depends on the buyer. For me, I paid about $1,025 for my unlocked 64GB iPhone 4S with AppleCare+ here in the U.S. Will I do it again, I'm sure I would. With the amount of apps (& growing) that I have, the iPhone is without a doubt the ONLY choice I have when buying a new phone.

I also think that the pricing at first launch with the original iPhone was too high & did not sell well simply because it is a completely "new" product. Most people were so used to a simple phone back in 2007 as people are accustomed to getting a decent cell phone for free on a cell phone contract. IMHO, the initial price then was a shocker. However, nowadays, more & more people get to appreciate the "true value" smartphones bring & with the largest & still growing apps offering that can be found in Apple's app store, I humbly think if pricing for an iPhone starts at $499 (on a contract) today, they will still sell like hotcakes!
Most people buy subsidized. $199 to $399.

Carriers pay full price and subsidize it with the plan.
 

SPEEDwithJJ

macrumors 65816
Nov 2, 2008
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Most people buy subsidized. $199 to $399.

Carriers pay full price and subsidize it with the plan.
Of course, I know that.

What I'm saying is even if the iPhone starts at $499 on a contract today, with carriers "massively" reducing their subsidies, I personally still think that they will still sell like hotcakes.
 

SandynJosh

macrumors 68000
Oct 26, 2006
1,652
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Wow, 89% of purchases of iPhones in the US were the iPhone 4S? Just imagine when the iphone 5 comes out
AND most of the 4S iPhones sold were the higher-end (more RAM) models! "Wow, oh wow, oh wow."

I wonder if that stat might induce Apple to raise the RAM in the next iPhone incarnation since the buyers have spoken?
 

paul4339

macrumors 65816
Sep 14, 2009
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Well in all honestly, the original iPhone which was sold @ $499 and $599 did not sell all that well after the initial launch. It was only when Apple dropped the price a couple months after launch that sales started to ramp up. If Apple (Steve Jobs) had been obstinate on price the iPhone may not be the Smartphone leader it is today, but I think Jobs learned that lesson w/ the Cube.
I think what happened was when the iPod touch 8GB/16GB came out (Sept 2007) at $299/399, people weren't happy with the iPhone 4GB/8GB was still priced at $499/599 for basically the same product add phone. Apple lowered the price and started to phase the 4GB model out.
 

BornAgainMac

macrumors 603
Feb 4, 2004
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I got the 64 GB model since the phone wasn't changed much except for the incredible camera, video capture, Apple TV mirroring, and Siri that I notice the most.

Isn't the monthly plan still expensive with the 3GS. The 3GS is hardly a deal if it is even if they gave it away.
 

neiltc13

macrumors 68040
May 27, 2006
3,116
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So bored of hearing about this "free" iPhone offer. The phone is not free - you have to sign up for a long, expensive contract to get it.

Also, the "free" phones are common in Europe. Every new iPhone is available with no up front cost from most of the networks - you can get a 4S for "free" right now in the UK if you want.
 

SPEEDwithJJ

macrumors 65816
Nov 2, 2008
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AND most of the 4S iPhones sold were the higher-end (more RAM) models! "Wow, oh wow, oh wow."

I wonder if that stat might induce Apple to raise the RAM in the next iPhone incarnation since the buyers have spoken?
I can't wait for Apple to release an iPhone with 128GB or even 256GB built-in storage capacity! :eek: :D

*I'm drooling at that thought right now* :eek:
 

aristotle

macrumors 68000
Mar 13, 2007
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Canada
No, they don't.

Roughly 60% of iPhone sales are outside the United States of America. Subsidized handsets are not the norm in most international markets.
Way to paint all other countries with the same brush. I got my 4S subsidized and I would guess that the majority of people in Canada got their phone subsidized on contract.
 

JAT

macrumors 603
Dec 31, 2001
6,473
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Mpls, MN
So bored of hearing about this "free" iPhone offer. The phone is not free - you have to sign up for a long, expensive contract to get it.
You have to do that for a phone worth $20, too. You have to do that almost no matter what you do. Your boredom doesn't fix the mess we have to deal with here. I think we should be allowed to discuss it without people harping on it. That said....
I wrote that most international markets do not have subsidized handsets, not all of them.

My statement stands as written.
Doesn't matter, Apple is counting what they receive, which is full price regardless. So my question is, what is the current full price of the 3Gs and 4 (8GB)? We only know the prices of the 4s models.
 

gnasher729

macrumors P6
Nov 25, 2005
16,596
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Roughly 60% of iPhone sales are outside the United States of America. Subsidized handsets are not the norm in most international markets.
I really disklike this being called "subsidized". No phone is subsidized or free. You buy a phone with a contract, they give you a huge lone that covers most of the purchase price, and you pay the loan back every month at an enormous interest rate as part of your monthly fees.


Wow, 89% of purchases of iPhones in the US were the iPhone 4S? Just imagine when the iphone 5 comes out
I suppose the percentage will go down a lot, if the iPhone 5 is any good.
 

Slurpy2k8

macrumors 6502
Feb 26, 2008
383
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I can't wait for Apple to release an iPhone with 128GB or even 256GB built-in storage capacity! :eek: :D

*I'm drooling at that thought right now* :eek:
I'm not. I honestly can't even imagine what I would do with 128-256GB. What will you do? Store a library of HD movies to watch on a 3.5" screen? My 16GB is just mind. I MIGHT consider a 32GB model for my next one, to have some leeway for photos/videos taken by the camera- but thats the only thing I can think of that would take up substantial space. 256GB? Give me a break.