iPhone price cut: Official response from Steve Jobs

[50548]

Oh how magnanimous of his royal Steve. Instead of money they give store credit so there is a better then average chance that what you walk out with will be whatever the cost of that new toy is - $100. They may as well have called it a sales promotion.
It would be as if the Microsoft settlement check I got in the mail last week (MN vs. MS.) could only spend it on a Microsoft product or a computer with a Microsoft OS.
Gah. I'm going to be sick at how many people think this is a good thing. Its simply Apple trying to save face in the wake of being caught with their pants down and....well lets not get into that image...its pretty

What really gets me isn't that Apple is doing this. They are a company. No issues with the act. Most companies play games from time to time. Its the loyalty factor. I understand bing a fan of a company. I understand enjoying a product. But stuffing one's head in the sand and acting as if what has happened is no big shake is....well hell its what got Microsoft to where it is today. If people want to make Apple better they should be pissed and holding their feet to the fire. Not saying that a $100 in store credit is good enough.

Once more, Apple did NOT and should NOT give any credit back; you are supposed to buy what you want on the day that you want, period. The rest belongs to the waves of the IT market.

Your comment is totally off-base, honestly...SJ just threw bones to the whiners and got a great PR stunt out of it. But it wasn't their duty AT ALL; and that's exactly why SJ gave them credit, not refunds. Because he SHOULDN'T.

 

[izzle22]

I don't have an iPhone yet but I bought a RZR day one for $499 with a two-year service contract in early 2005. Six months later, Motorola dropped the price to $199 . By the end of 2005, the price was $99.

I never got a refund or store credit or anything and I loved that phone. Still do.

Riiiiiiiiiight, the key here is 6 MONTHS! Not 2. And I would expect that from motorola. The whole point here is that Apple stayed in business in the early days due to loyal customer support and Apple doesn't usually drop prices that quick. As I've said many many times this week- It's not that Apple lowered the price on the iPhone(I knew they would) but the fact that they lowered by $200 in 2 months time. That's the point and thats it. If Apple wasn't worried about what they did they would have never offered the $100 back.

 

[cavatappi]

iPhone buyers win. iPod buyers lose.

I'm happy to see that Apple did the right thing for early-adapter iPhone buyers. Us late-adapter iPod buyers aren't so lucky. After much deliberation, this past June ('07) I left my previous MP3 player and content provider behind. I bought a 30Gb ipod. Had I waited 3 months, I could have had 2-1/2 times the iPod (80Gb) for about the same price. Boy, do I feel stupid and angry. I'm not as savvy as long-time Apple types, being a PC user and all. Still, I feel like my money was gladly taken for an almost immediately diminished product. Great work, Apple, you made my first experience with your company--and its brand of marketing/sales strategy--less than stellar. When I got divorced and married you, I thought you were "the one." Now, I find out about the wooden leg. So, now I'm stuck with less than I had imagined and hoped for. You're good in bed though; otherwise, I'd dump you too.

 

[elcid]

6 months and an update to iPhone 2.0? Steve better watch out. iPhone customers might believe that is too soon to release a new item. He might have to give all iPhone customers a new iPhone 2.0.


[/sarcasm]

It should NOT be any surprise that come January and MACWORLD there will be Gen two of the iPhone. It have gave more memeory and have a few improvements.

 

[psouper]

So waht is it worth

Some of you people are so loyal to Apple you are little short of religious converts who seem to have lost all touch with reality. So Apple really look after their customers do they? Anyone who has had a piece of Apple gear go wrong will know otherwise. As an owner of a G4 iBook that clunked out about 18 months after purchase due to its inherenyly poor design I can tell you that Apple is not some great benevolent; they barely meet the legal requirements. And as to this crumby rebate you all seem so gratefull for...wake up! you paid $200 over the odds and get a $100 voucher to use in the Apple toy shop which cost Apple what? at most $50 (given a minimum 100% mark up) or more likely $25. Take off the rose tinted specs. Apple is just another US corporation intent on world domination and Steve Jobs the very rich CEO.

 

[nemaslov]

Riiiiiiiiiight, the key here is 6 MONTHS! Not 2. And I would expect that from motorola. The whole point here is that Apple stayed in business in the early days due to loyal customer support and Apple doesn't usually drop prices that quick. As I've said many many times this week- It's not that Apple lowered the price on the iPhone(I knew they would) but the fact that they lowered by $200 in 2 months time. That's the point and thats it. If Apple wasn't worried about what they did they would have never offered the $100 back.

So I guess:

-33% in two months=BAD (APPLE)
-60% in six months= GOOD (MOTOROLA)
-80% in nine months = GOOD (MOTOROLA)

(THE GOODS ARE WHAT MOTO DID WITH RZR)

OK THANK YOU!

 

[dan-o-mac]

Wow thats amazing of them!
ps:to all those people who told all us complainers to shut up,apparently we were right, and apple thought so too and they delivered.

Now Apple knows dropping prices too soon is a bad thing, they will hesitate or wait longer to drop prices in the future. Wohoo great job.

 

[NOV]

A great way to be assured of a good iPod nano sales season.

 

[ctsport1234]

great news! what an awesome company apple is!

 

[jackc]

Some of you people are so loyal to Apple you are little short of religious converts who seem to have lost all touch with reality. So Apple really look after their customers do they? Anyone who has had a piece of Apple gear go wrong will know otherwise. As an owner of a G4 iBook that clunked out about 18 months after purchase due to its inherenyly poor design I can tell you that Apple is not some great benevolent; they barely meet the legal requirements. And as to this crumby rebate you all seem so gratefull for...wake up! you paid $200 over the odds and get a $100 voucher to use in the Apple toy shop which cost Apple what? at most $50 (given a minimum 100% mark up) or more likely $25. Take off the rose tinted specs. Apple is just another US corporation intent on world domination and Steve Jobs the very rich CEO.

World domination! Yay!

 

[stompy]

Riiiiiiiiiight, the key here is 6 MONTHS! Not 2. And I would expect that from motorola. The whole point here is that Apple stayed in business in the early days due to loyal customer support and Apple doesn't usually drop prices that quick. As I've said many many times this week- It's not that Apple lowered the price on the iPhone(I knew they would) but the fact that they lowered by $200 in 2 months time. That's the point and thats it. If Apple wasn't worried about what they did they would have never offered the $100 back.

Razr after 2 months?

>>>
Originally Posted by Music_Producer on another thread
The Motorola Razr was $499 the day it launched (16 nov 2004) On Jan 22, 2005.. you could get it for $339. What's that? A $160 price drop in 2 months.
>>>

Of course, that's only 32% after 2 months, Apple cut the iPhone price by 33%.

 

[seashellz]

I dont remember where, but one of these Wall Street analyst firms were quoted in the WSJ in just the past 2 days, that the reason for this sudden action was because APPLE was alarmed at the sudden drop off of sales, now that the early adopter have come and gone.
Makes sense to get rid of the lesser one, and drop the price of the 8gb.

 

[Gurutech]

although some call themselves "loyal customers", they are a bunch of whiners.

Ok. can someone clarify what's justified price cut and what's not?
2 months : not ok
3 months?
4 months?
oh right what about 2 months and 1 day? lol

is there a specific equation?
t = time since launch p = percentage of price cut c= some weird constant lol

like 1 > c*p/t justified? [/sarcasm]

 

[ThunkDifferent]

Not too shabby...

This is surprising and an obvious misstep for the cupertino based company. The iTouch should be grabbing the headlines, not $100 rebates. It's fair to the customers though and overall the right decision, it just should never have came about, cutting a product by suc a large percentage so soon spells too much aggression for Apple, it has came back to bite them in arse.

 

[Flowbee]

I dont remember where, but one of these Wall Street analyst firms were quoted in the WSJ in just the past 2 days, that the reason for this sudden action was because APPLE was alarmed at the sudden drop off of sales...

Wall Street analysts' guesses are as good as yours or mine. They're generally working from the same public information we all have access to.

 

[ajhill]

Apple will make money on this move

Net net Apple makes money on this move. And they will sell a lot more iphones at $400 than at $600. With the new lineup of ipods they had no choice but to cut the price to fit it into the ipod family. Now there is just a $100 premium for the phone over the price of just the ipod touch.

Jobs is no fool. Going after the cell market hard and fast, which is exactly what you have to do when you enjoy a competitive advantage over the rest of the world.

Think of th huge potential of the mass market, not just the early adoptors. Don't forget that Apple gets a kickback from Att and a monthly cut of each bill.

The monumental shift happens for Apple happens when they suck in the people who usually just buy a basic cell phone. When they convince those people to step up to an iPhone then Apple's profits really take off.

Is Steve Jobs desperate? No. It would have been better I'd the iphone had come out at $500 and then discounted to $400. But you can't go back and do it over. At least Apple got it right for Christmas.

 

[sellitman]

I'm happy to see that Apple did the right thing for early-adapter iPhone buyers. Us late-adapter iPod buyers aren't so lucky. After much deliberation, this past June ('07) I left my previous MP3 player and content provider behind. I bought a 30Gb ipod. Had I waited 3 months, I could have had 2-1/2 times the iPod (80Gb) for about the same price. Boy, do I feel stupid and angry. I'm not as savvy as long-time Apple types, being a PC user and all. Still, I feel like my money was gladly taken for an almost immediately diminished product. Great work, Apple, you made my first experience with your company--and its brand of marketing/sales strategy--less than stellar. When I got divorced and married you, I thought you were "the one." Now, I find out about the wooden leg. So, now I'm stuck with less than I had imagined and hoped for. You're good in bed though; otherwise, I'd dump you too.

Ever hear of eBay? Most everyone has bought a tech product in their lives to have it replaced months, weeks, or even days later. It's the nature of the beast. Sell it and upgrade.

 

[reubs]

A few observations from someone who wanted an iPhone but didn't get one...and probably won't get one for a very long time.

1) I think it's hilarious that Apple dropped the price so quickly and people are so up in arms about it. The price you pay for early adopting is realizing that pretty soon the product will drop in price.
2) People are so angry about the price drop b/c they think Apple owes them something. Apple doesn't owe any of us anything except continuing to put out great products that perform well.
3) I bought a 60 gig 5G one month before the 5.5G were announced. I felt a little burned, but only for about 5 minutes. I have been thrilled w/ my 5G every day since then.
4) Apple and Steve Jobs didn't have to offer a credit, a refund, or a reach-around to anyone. The credit will indeed benefit them, but if you were willing to buy an iPhone chances are good you'll be buying another Apple product sometime soon.
5) If you've got $600 to spend on an iPhone, the last thing most people want to hear about is you bitching about them lowering the price. I don't have $600 to spend on a phone, and I'm not too sympathetic to those of you that do. If you have that kind of cash to spend there, $200 isn't going to hurt much.
6) Finally, so what about the iPod touch? It's an iPhone w/o the phone. I think the big story here is the 160 GB (160 GB!) iPod. That's insane!

 

[Potus]

Huh?

People who have used their iPhones for 2 months are still angry? They're unhappy with the $100.00 credit?
Try buying a new car. Once the contract is signed and you drive it off the lot it's worth $5000.00 less because it's used. But no one complains because it's "always" been like that, even though you are still liable for the entire amount of the contract.
I have a friend who's an early adopter, who is not angry about the price drop or the credit or any other petty stuff. He's happy with the iPHone it was his first cell phone and he loves it. He recognized from the day he bought it (immediately after launch) that a "bigger, better, faster" was inevitable and yet he's a happy man. He got the phone he wanted when he wanted it. It's all good.

 

[Potus]

A

6) Finally, so what about the iPod touch? It's an iPhone w/o the phone. I think the big story here is the 160 GB (160 GB!) iPod. That's insane!

You are so right. You can carry your entire music catalog around just like that. Amazing.

 

[janstett]

Good luck

You have though neatly and concisely detailed the faults of this first revision iPhone. These are the reasons my friends who need a PDA-phone for work will never use an iPhone.

Below are my personal reasons why I did not buy an iPhone:

I toyed with the idea of getting one as my Verizon contract is up at the end of this month. However it's all down to taste. I signed up yesterday for an Ocean from Helio. Really liked the slide keyboards and the 3g web, GPS, now with a voice direction offering but really what clinched it for me, comparing it only with Verizon, was all the data is as much as you can eat, the only by the minute plans are for voice. I can transfer my old cell number at anytime later.

I was very intrigued by the Ocean; 3G and GPS really got me interested. However, I've played with a few similar Windows mobile slide phones and found them to be too chunky, and not easy to use without a stylus. I like the Ocean and wish you luck with it; and I am concerned about the size of the iPhone -- pocket friendly but a lot of surface area.

While wasting 90 minutes at a Verizon store to get my Razr firmware upgraded, I played with all the smartphones and didn't really like any of them (they didn't have the Ocean in store).

Further, I know AT&T isn't going to make me like cellphone companies, but I have to extricate myself from Verizon.

I have been a Verizon customer since 1996-97-ish. My first phone was an analog Nokia about the size of two sticks of butter. In that time, I've noticed the following attributes of Verizon that make me want to bail:

- Always have the cool phones last (because of their archaic CDMA)
- Can't roam out of the country (because of their archaic CDMA)
- I don't really talk that much so I keep around 300 minutes. My bill creeps up over the limit too quickly, and my plan always escalates over time. I always start out a contract at around $30/mo and always end up at least $50. My last bill was $68, without going over my 300 minutes allowance. So right there I'm paying more than an iPhone with 450 minutes and unlimited data.
- Can't buy a cool phone overseas and put in your sim card (again CDMA)
- Can't take your SIM card out and swap from phone to phone (CDMA)
- Locks features of the phone (this drives me INSANE). I have a RAZR, they disable ringtones, they disable photo upload/download, etc. Bollocks to that!
- Nickels and dimes you to death. Not just V*cast, but that's why they lock out ringtones (to force you to buy them from Verizon). They just added GPS to my Razr, $3.95 for 3 days or $9.99 per month. They just don't stop with charging you for every little damned thing.
- I've been getting three daily news blast text messages that I signed up for three or four phones ago. I get charged for each one, and they're useless sentence fragments that tell me nothing. Customer service can't figure out how to get rid of them.
- My internet access breaks regularly every 6 months requiring a trip to the Verizon store to fix it.

So, for what I need (a personal plan with not a whole lot of voice, plus unlimited data for being a nerd), AT&T's $60/mo plan works for me. We'll see, everyone I know is on Verizon so now I'm going to lose the IN free calling, I'll be the black sheep.

 

[cysquatch]

I dont feel bad at all. I never understood the need to go out and get the latest and greatest right away. Why would I get it $200 cheaper now? Because, I haven't jumped on the wagon yet, that's why.

Ive been wondering why I have been seeing so many thick rimmed glasses shedding so many tears on their way back to their VW's at the end of the day.

 

[janstett]

6) Finally, so what about the iPod touch? It's an iPhone w/o the phone. I think the big story here is the 160 GB (160 GB!) iPod. That's insane!

Amen! I have an 80 gig stuffed to the gills, such that I have to delete stuff to put anything new on. I've always been complaining that I can't get my full 30,000 MP3 collection on, how I have to downsample to AAC 128k and lose my live albums... Now, I have to shut up Well I can start complaining that I can't fit my mixed MP3 and ALAC lossless collection, which is around 300 gigs. Maybe the 8th generation iPod will handle it?

 

[nemaslov]

Amen! I have an 80 gig stuffed to the gills, such that I have to delete stuff to put anything new on. I've always been complaining that I can't get my full 30,000 MP3 collection on, how I have to downsample to AAC 128k and lose my live albums... Now, I have to shut up Well I can start complaining that I can't fit my mixed MP3 and ALAC lossless collection, which is around 300 gigs. Maybe the 8th generation iPod will handle it?

I'll triple that. Ordered mine on Tuesday and it just shipped, engraved. My 80 is full and i got 110GB of music only, on my mac. To me it is still all about the music...thank you!

 

[poppe]

It'll probably have a decent expiration length, you'll want something soon enough!

Well yes probably. It's just that I have things that need fixing right now. I'll buy Apple stuff no matter if I have a gift card or not, but I have 300 broken printer (used twice) that needs to be fixed (my fault. A Q-Tip fell in to the paper loader).