RAM: Why is Apple’s Price for 32GB so High?

[F-Train]

Apple wants US$200 for 16GB. This is US$30-$40 over market, which strikes me as thoroughly reasonable.

But it wants $600 for 32GB, which is about $300 over market.

There has been a good deal of discussion about installing 32GB oneself, but no discussion, at least that I’ve seen, on why Apple’s price for 32GB is so out of whack with market price, especially given that its price for 16GB is pretty close to market.

Can anyone come up with a plausible reason? The only thing that I can come up with is that Apple foresees significant volatility in the price of 16GB RAM sticks.

Obviously, in both cases Apple is passing on its cost of 8GB, but I think that that is a wash and not germane to this question.

 

[Spectrum]

Not really...Apple is actually charging $200 for 8GB (and any multiple thereof) when you factor in the included 2x4GB. Apple has always overcharged for RAM unfortunately. Not sure why other than that they can.

 

[firewire9000]

Because margins.

 

[chscag]

The Mini only has two RAM slots which means 2 x 16 GB modules = 32 GB. 16 GB modules are expensive no matter who you buy them from. But, like has already been said, Apple overcharges for memory.

 

[xylitol]

If we add this (falling prices)
https://www.tomshardware.com/news/dram-memory-shortage-prices-nand,37627.html

...to this (prices in freefall)
https://www.tomshardware.com/news/ssd-prices-drop-2019-prediction,37982.html

...I think Apple is going to (or ought to) adjust its upgrade pricing sometime next year.

 

[Partron22]

Apple likes the stupid rich people market, and does pretty well with it.

 

[dogslobber]

Apple wants US$200 for 16GB. This is US$30-$40 over market, which strikes me as thoroughly reasonable.

But it wants $600 for 32GB, which is about $300 over market.

There has been a good deal of discussion about installing 32GB oneself, but no discussion, at least that I’ve seen, on why Apple’s price for 32GB is so out of whack with market price, especially given that its price for 16GB is pretty close to market.

Can anyone come up with a plausible reason?

It’s harder to install 32GB than it is to install 16GB...?

 

[StellarVixen]

They don’t have any other way to earn profits. Look at the price of other components. Their prices are more in line with what would you pay for them anyway.

 

[Cashmonee]

Apple wants US$200 for 16GB. This is US$30-$40 over market, which strikes me as thoroughly reasonable.

But it wants $600 for 32GB, which is about $300 over market.

There has been a good deal of discussion about installing 32GB oneself, but no discussion, at least that I’ve seen, on why Apple’s price for 32GB is so out of whack with market price, especially given that its price for 16GB is pretty close to market.

Can anyone come up with a plausible reason? The only thing that I can come up with is that Apple foresees significant volatility in the price of 16GB RAM sticks.

Obviously, in both cases Apple is passing on its cost of 8GB, but I think that that is a wash and not germane to this question.

Like Spectrum said, they are technically charging you $400 for the 16 GB option (an assumption that it is $200 for the original 8 GB) and therefore $800 for the 32 GB option. You are forgetting that the original 8 GB is already factored into the cost of the mini and when you upgrade to 16 GB for $200, you don't get the original 8 GB. I am not sure that makes sense, but the gist of it is that even the 16 GB upgrade is not really reasonable since you are really only paying for 8 GB worth of RAM over the base, making that second 8 GB about 3 times the (consumer) cost of a single stick of RAM.

The reason is one, they can, and two they probably figure most people going to 32 GB are professionals that generally are ok paying for convenience and perceived reliability because the machine will generate more revenue than they spent on it, even with Apple's prices. Apple assumes (knows) that most regular everyday users will purchase one of the two pre-configured models, and not be affected by the prices they are charging.

 

[F-Train]

Like Spectrum said, they are technically charging you $400 for the 16 GB option (an assumption that it is $200 for the original 8 GB) and therefore $800 for the 32 GB option. You are forgetting that the original 8 GB is already factored into the cost of the mini and when you upgrade to 16 GB for $200, you don't get the original 8 GB. I am not sure that makes sense, but the gist of it is that even the 16 GB upgrade is not really reasonable since you are really only paying for 8 GB worth of RAM over the base, making that second 8 GB about 3 times the (consumer) cost of a single stick of RAM.

The reason is one, they can, and two they probably figure most people going to 32 GB are professionals that generally are ok paying for convenience and perceived reliability because the machine will generate more revenue than they spent on it, even with Apple's prices. Apple assumes (knows) that most regular everyday users will purchase one of the two pre-configured models, and not be affected by the prices they are charging.

You can’t make your numbers work without assumptions that are based on speculation. I think that you are working backwards from a desired conclusion.

At least it takes more effort than some of the reasons suggested.

 

[Cashmonee]

You can’t make your numbers work without assumptions that are based on speculation. I think that you are working backwards from a desired conclusion.

At least it takes more effort than some of the reasons suggested.

I have no desired conclusion honestly. You start with 8 GB. If you want to add 8 GB more, you have to pay $200. You are not getting 16 GB for your $200, you are getting 8 more. When you purchase two 8 GB sticks yourself to install, you are getting 16 GB for your money, about $130. Cut that in half, and you are looking at $65 for 8 GB which Apple wants to charge you $200 for. That is more than a 3x markup. It seems pretty clear Apple are charging you $200 for every 8 GB all the way up to 64 GB. It isn't a huge leap to say that if you spec a machine to 16 GB from Apple that you essentially paid $400 for that amount of RAM, since they assuredly factored in the first 8 GB into the base price.

I will admit, I still think the 16 GB upgrade from Apple is probably still the way to go since you have already sunk money into the 8 GB that came with the machine, and while you could sell it, it is probably worth hanging onto since I doubt there is a decent amount of money to be made on 2 4 GB sticks of RAM. That does not change the fact that you essentially are paying 3x for RAM from Apple, at least for 16 GB (have not priced 32 GB or 64 GB).

 

[namethisfile]

I think it's more expensive to have Apple upgrade the RAM for you because you're paying for someone to put that RAM in the computer, as well as, taking the other RAM sticks out. And, considering that it's a Mac, it isn't as easy of a procedure. But, ease of upgrade is not really the main reason why I think it is more expensive since these will be Apple Technicians, who are experienced in installing Mac RAMs.... In any case, they also probably have to run the usual battery of diagnostic tests to make sure the RAM sticks are good, etc. So, that is one area where that extra price might go to.

Also, these people are probably not the same people who are already paid or are already there at the Macintosh assembly/shop/whatever. But, people who are probably paid just to install RAM. I don't really know. But, that is the only thing I could think of as to why it cost that much.

I don't think it's Apple being greedy. Or, because they could.

Also, besides manual labor, I think, that Apple orders RAM in bulk and so, the RAM they have on hand can either be put in Macs that are sold for a higher price and higher profit, or kept on the side for people who wants to upgrade their RAM. And, so, to even out or spread the profit margin, RAM upgrades are as is...

But, I am just guessing.

I hope it's not because they just feel like it.

 

[Spectrum]

Presumably the BTO with extra RAM is done at the point of assembly, so there would be almost zero additional cost of installing 16 or 32 GB RAM relative to 8GB. (Other than the component cost and keeping track of different units on the assembly line.)

It's not like you are paying a tech to dismantle a base model and swap out the RAM - that would be crazy!
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You can’t make your numbers work without assumptions that are based on speculation. I think that you are working backwards from a desired conclusion.

At least it takes more effort than some of the reasons suggested.

I completely disagree. When you look at the upgrade pricing, it is pretty clear that Apple is costing 8GB at an end-user price of $200. Of course it doesn't cost them anything like this much to install 8GB of RAM. It is all smoke and mirrors to make certain models hit certain price points to make them look good/bad value and to entice some users to BTO. Loads of consumer psychology goes into setting the correct pricing structure. It has very little to do with actual component cost.
They do something very similar for SSD prices (although there the 128>256 is twice the price per GB of all the other upgrades!)
And the same with iPads and iPhones. Nothing new unfortunately.

 

[DVD9]

So two 4GB sticks of RAM is worth about $100?

So the real cost/profit-for-Apple is $300 for 16GB not $200

So the real cost/profit-for-Apple is $700 for 32GB not $600

 

[Cashmonee]

So two 4GB sticks of RAM is worth about $100?

So the real cost/profit-for-Apple is $300 for 16GB not $200

So the real cost/profit-for-Apple is $700 for 32GB not $600

I think I know what you are saying. However two sticks of 4 GB of RAM is more like $60-$70 street price. Also, you are assuming Apple is charging street price for the first 8 GB instead of the Apple pricing.

 

[Fishrrman]

The question:
"Why is Apple’s Price for 32GB so High?"

The answer:
Because they can charge that much, and enough folks are willing to pay the price.
That's "the Apple way".

Next question....?

 

[DVD9]

I think I know what you are saying. However two sticks of 4 GB of RAM is more like $60-$70 street price. Also, you are assuming Apple is charging street price for the first 8 GB instead of the Apple pricing.

OK

So two 4GB sticks of RAM is worth about $60?

So the real cost/profit-for-Apple is $260 for 16GB not $200

So the real cost/profit-for-Apple is $660 for 32GB not $600

 

[MacWorld78]

Apple has made a very clever business model, it's all based on your desire, you know you need more RAM but a bit tricky to upgrade myself but I have no choice but to pay more.

 

[doboy]

One word: greed

 

[AmazingRobie]

Install fee is included.

 

[BorderingOn]

I think it's more expensive to have Apple upgrade the RAM for you because you're paying for someone to put that RAM in the computer, as well as, taking the other RAM sticks out. And, considering that it's a Mac, it isn't as easy of a procedure. But, ease of upgrade is not really the main reason why I think it is more expensive since these will be Apple Technicians, who are experienced in installing Mac RAMs.... In any case, they also probably have to run the usual battery of diagnostic tests to make sure the RAM sticks are good, etc. So, that is one area where that extra price might go to.

Also, these people are probably not the same people who are already paid or are already there at the Macintosh assembly/shop/whatever. But, people who are probably paid just to install RAM. I don't really know. But, that is the only thing I could think of as to why it cost that much.

I don't think it's Apple being greedy. Or, because they could.

Also, besides manual labor, I think, that Apple orders RAM in bulk and so, the RAM they have on hand can either be put in Macs that are sold for a higher price and higher profit, or kept on the side for people who wants to upgrade their RAM. And, so, to even out or spread the profit margin, RAM upgrades are as is...

But, I am just guessing.

I hope it's not because they just feel like it.

If that were true upgrade pricing would not be linear. How about SSD upgrade pricing? Nobody is manually installing that.

 

[namethisfile]

If that were true upgrade pricing would not be linear. How about SSD upgrade pricing? Nobody is manually installing that.

Okay, the way I envision what a Mac Mini assembly line or shop looks like is that Apple will fully assemble complete Mac Mini's with the standard configurations and a few with the BTO SSD options. Maybe, 80% Standard and the rest are divvy'd up to fill in the remaining SSD BTO options and are shipped to retailers like B&H, Adorama, etc. Apple stores and Best Buy only carry the standard config and anyone who needs the BTO SSD upgrade will need to go online.

The seemingly high price for them is probably because of the way Apple distributes profits and operations margins (sorry, I am not an econ major; just using common sense).... So, it boils down to the Mac Mini plant/shop scenario once again where you have labor cost involved as well as parts. The labor is running the Mac Mini plant with the BTO mac mini's going to you and me; and, the parts appropriated for those Janes and Joes to the single digit. So, it seems like Apple doesn't buy a whole bunch of 1TB SSD's for the Mac Mini for us. But, is pre-calculated or pre-catered and the cost of that pre-catering (think of it like in restaurant business) is that the BTO price is not just for SSD itself, but the supporting staff, the machinery and the time involved in pre-catering to individuals, of which Apple takes as seriously as they do when catering to businesses.

So, in that sense, Apple treats everyone, the poor (like me), the rich (you) and businesses the same way. And, that is the staff, and machinery involved in making the Mac Mini's.

I am sorry if that is not making sense. But, kinda like that I think....

It could also be where/how Apple differs from other companies in where/how they acquire SSD's and RAMS.

Perhaps, Apple has one SSD Tree and one RAM Tree where they get their parts from. And, other companies have 2 or more Component Trees to source their parts, thus making it cheaper and probably less support, machinery parts involved so they're closer to the price you find in retail stores.

Again, just guessing...

So, from the latest example above, say Dell... even though Dell is as big in terms of volume as Apple, they probably have less support staff or something like that who are specifically catered to those XPS Laptops that are going to you and me. And, they probably get RAM and SSD's from at least two more sources than from Apple. And, perhaps, the Dell Plant and Shop only has like two people working, whereas, at Apple there are maybe 20 ppl. I don't know, just guessing...

And, the Mac Mini plant compared to the Dell plant probably has cooler machinery in them that cost more. Again, I don't know...

 

[LeeW]

Why would Pirates only steal half your money if they can just take it all?

Note. Replace Pirates with Apple and see if it still works.

 

[Count Blah]

Because Apple is NOW and always will be, a margin company, no matter how much WE wish they were actually a product company.

 

[BorderingOn]

Okay, the way I envision what a Mac Mini assembly line or shop looks like is that Apple will fully assemble complete Mac Mini's with the standard configurations and a few with the BTO SSD options. Maybe, 80% Standard and the rest are divvy'd up to fill in the remaining SSD BTO options and are shipped to retailers like B&H, Adorama, etc. Apple stores and Best Buy only carry the standard config and anyone who needs the BTO SSD upgrade will need to go online.

The seemingly high price for them is probably because of the way Apple distributes profits and operations margins (sorry, I am not an econ major; just using common sense).... So, it boils down to the Mac Mini plant/shop scenario once again where you have labor cost involved as well as parts. The labor is running the Mac Mini plant with the BTO mac mini's going to you and me; and, the parts appropriated for those Janes and Joes to the single digit. So, it seems like Apple doesn't buy a whole bunch of 1TB SSD's for the Mac Mini for us. But, is pre-calculated or pre-catered and the cost of that pre-catering (think of it like in restaurant business) is that the BTO price is not just for SSD itself, but the supporting staff, the machinery and the time involved in pre-catering to individuals, of which Apple takes as seriously as they do when catering to businesses.

So, in that sense, Apple treats everyone, the poor (like me), the rich (you) and businesses the same way. And, that is the staff, and machinery involved in making the Mac Mini's.

I am sorry if that is not making sense. But, kinda like that I think....

It could also be where/how Apple differs from other companies in where/how they acquire SSD's and RAMS.

Perhaps, Apple has one SSD Tree and one RAM Tree where they get their parts from. And, other companies have 2 or more Component Trees to source their parts, thus making it cheaper and probably less support, machinery parts involved so they're closer to the price you find in retail stores.

Again, just guessing...

So, from the latest example above, say Dell... even though Dell is as big in terms of volume as Apple, they probably have less support staff or something like that who are specifically catered to those XPS Laptops that are going to you and me. And, they probably get RAM and SSD's from at least two more sources than from Apple. And, perhaps, the Dell Plant and Shop only has like two people working, whereas, at Apple there are maybe 20 ppl. I don't know, just guessing...

And, the Mac Mini plant compared to the Dell plant probably has cooler machinery in them that cost more. Again, I don't know...

I was responding to a specific point but if you look around you will see that Dell, Lenovo, HP, and others, mark up RAM just as much. So I don’t think it’s what you mentioned. They certainly wouldn’t try to cover fixed costs by padding the price of BTO models only. Call it whatever you want but the price seems to have very little relationship to the cost. For modular components you get to pick your poison. Unfortunately, for most of what Apple is offering today, you don’t.