The 16GB iPhone is NOT a ripoff

[Surf Donkey]

Thank you for this initial post, it was very well-written and thought out. I am studying accounting and economics currently and this was a good read!

FWIW, one must consider that a user who purchases a 16gb iPhone has the option of iCloud photo library (now 50 GB @ $0.99 / mo.) - Yes for a buck a month, one has an additional 50 GB. Also, I love to keep my music library on my phone - but with Apple Music, the game is changed. I can stream it whenever. I can put hard copies on my phone for a road trip without LTE.
Would I ever purchase a 16 GB iPhone? Nope. Not a chance. 64 GB is the sweet spot for price, functionality, and revenue with current tech-amenities, and Apple knows that. Nevertheless, the 16 GB phone is totally usable, if savings of about $4 / mo. is worth it (on the new upgrade program)... You could always not buy a soda at lunch, twice a month, and you would have made up the difference in monthly cost between the 16 and 64 gig phone. What a silly world we live in to complain about such a thing.

Marketing and finance at Apple and the Carriers love you for saying this. It is so convenient right and you are saving with a smaller phone? And guess what, this logic will empty your pockets far more than the cost of more GB. Hence the whole point of this thread! The point is this won't end up being a better deal to you and the corporations know exactly what they are doing.

Apple music (9.99 per + data fees). Cloud (.99 per month + data fees). Data fees vary, caps, overages....see where this is going?

People think about cost saving now vs long term for everything. And it is a great way to take more profits.

 

[warrior2000]

Thank you for this initial post, it was very well-written and thought out. I am studying accounting and economics currently and this was a good read!

FWIW, one must consider that a user who purchases a 16gb iPhone has the option of iCloud photo library (now 50 GB @ $0.99 / mo.) - Yes for a buck a month, one has an additional 50 GB. Also, I love to keep my music library on my phone - but with Apple Music, the game is changed. I can stream it whenever. I can put hard copies on my phone for a road trip without LTE.
Would I ever purchase a 16 GB iPhone? Nope. Not a chance. 64 GB is the sweet spot for price, functionality, and revenue with current tech-amenities, and Apple knows that. Nevertheless, the 16 GB phone is totally usable, if savings of about $4 / mo. is worth it (on the new upgrade program)... You could always not buy a soda at lunch, twice a month, and you would have made up the difference in monthly cost between the 16 and 64 gig phone. What a silly world we live in to complain about such a thing.

Thanks for the kind compliments.

I'm a CPA and work at an investment bank. I think most who disagree with my points and Apple's pricing structure have no idea how real world finance works. They think "hey why not give the base iPhone 128GB" and not think of the potential impact it would have on the companies profitability AND long-term viability. Without strong earnings Apple cannot keep top talent, invest heavily in R&D, and provide the best user experience.

 

[warrior2000]

Then Apple should offer 32GB on the base model as it gives the best of both worlds. Those who don't use a lot of storage it doesn't matter, those who can't afford a more expensive phone, it will make a big difference.

then why stop there? Apple should start with 128GB using your logic.

the problem is you are totally ignoring the financial impact of Apple offering a 32GB base model.

 

[warrior2000]

Marketing and finance at Apple and the Carriers love you for saying this. It is so convenient right and you are saving with a smaller phone? And guess what, this logic will empty your pockets far more than the cost of more GB. Hence the whole point of this thread! The point is this won't end up being a better deal to you and the corporations know exactly what they are doing.

Apple music (9.99 per + data fees). Cloud (.99 per month + data fees). Data fees vary, caps, overages....see where this is going?

People think about cost saving now vs long term for everything. And it is a great way to take more profits.

So companies should not try to make profits? LOL.

Dude. The public is free to stop buying iPhones.

 

[C DM]

then why stop there? Apple should start with 128GB using your logic.

the problem is you are totally ignoring the financial impact of Apple offering a 32GB base model.

Since you keep on bringing up the same irrelevant slippery slope argument: why not offer 8 GB then so that Apple can save even more money?

 

[warrior2000]

They didn't react in the 1990s, so I wouldn't put it past them.

The simple fact is that apple should offer the best experience, and 1GB of ram in the 6 and 16GB for a 2015 premium smart phone is not the best experience.

Consumers shouldn't be asked to pay more for something that should essentially be standard.

Again, I'm not looking to buy, just concerned for apple getting too arrogant for its own good and cutting corners to the extent that their focus is purely on profits instead of making the best product, to ensure good profits.

The 6s has 2GB of ram

 

[oldmacs]

The 6s has 2GB of ram

Read what I said - 1GB of ram in the 6.

 

[Surf Donkey]

So companies should not try to make profits? LOL.

Where did I say that? I think it is ****** and not the correct approach to their user base satisfaction, but they are certainly within their right (and responsibility to the shareholders) to do so.

 

[C DM]

The 6s has 2GB of ram

So they actually increased it and apparently it's not going to cause Apple to go under. Seems like that's an argument that Apple can similarly increase the base storage too and still do just fine. Thank you for providing the argument that supports the position that increasing the base storage would work just fine (and would be a good thing too).

 

[geoff5093]

Thanks for the kind compliments.

I'm a CPA and work at an investment bank. I think most who disagree with my points and Apple's pricing structure have no idea how real world finance works. They think "hey why not give the base iPhone 128GB" and not think of the potential impact it would have on the companies profitability AND long-term viability. Without strong earnings Apple cannot keep top talent, invest heavily in R&D, and provide the best user experience.

No one things they should start with 128GB, and everyone knows it would impact their bottom line. What we are saying is that they've had 16GB base models for years, and just like the bump from 4>8 and 8>16, it's now time to make that jump from 16>32. Apple is holding onto 16GB for too long when the rest of the market has started to make 32GB standard. This can make Apple look subpar for some consumers looking at base models.

 

[oldmacs]

then why stop there? Apple should start with 128GB using your logic.

the problem is you are totally ignoring the financial impact of Apple offering a 32GB base model.

The financial impact is not that great and apple should focus on user experience.

Plus you have used this argument so many times, and here is my pasted response for the 3rd time (at least):

32GB is adequate, and offers a good balance between profit margins and a good user experience. Thats like saying, why not start at 4GB. Because the industry has moved past 16GB. App sizes have increased, image sizes have increased, video sizes have increased.

 

[warrior2000]

Since you keep on bringing up the same irrelevant slippery slope argument: why not offer 8 GB then so that Apple can save even more money?

Cause Apple wants to give customers a break. LOL

Dude, its all simple SUPPLY and DEMAND and price elasticity.

If the market determines 16GB is a ripoff they will stop buying 16GB phones and maybe even iPhones period. But there is no sign of that happening. The iPhone6 destroyed all types of records and the 6s is on pace to destroy the 6 records. So until those facts change I'm going to give Apple the benefit of the doubt.

There really isn't any FACTS that prove that the 16GB phone is hurting Apple or their popularity.

 

[warrior2000]

No one things they should start with 128GB, and everyone knows it would impact their bottom line. What we are saying is that they've had 16GB base models for years, and just like the bump from 4>8 and 8>16, it's now time to make that jump from 16>32. Apple is holding onto 16GB for too long when the rest of the market has started to make 32GB standard. This can make Apple look subpar for some consumers looking at base models.

Very few smartphones start at 32GB. Samsung and LG and maybe one or two more. Most like Xiaomi, Levenovo, Windows phone, Moto, One+ all still start at 16GB.

So you say 128GB would obviously hurt Apple's bottom line. And you think starting at 32GB won't? LOL. Of course it will. There is still a very large market for 16GB iPhones so there is no reason for Apple to stop offering it.

 

[C DM]

Cause Apple wants to give customers a break. LOL

Dude, its all simple SUPPLY and DEMAND and price elasticity.

If the market determines 16GB is a ripoff they will stop buying 16GB phones and maybe even iPhones period. But there is no sign of that happening. The iPhone6 destroyed all types of records and the 6s is on pace to destroy the 6 records. So until those facts change I'm going to give Apple the benefit of the doubt.

There really isn't any FACTS that prove that the 16GB phone is hurting Apple or their popularity.

Once again ignoring the basic reality that many people buy the base model because it's cheaper not because it works better for them. 8 GB would sell very well if that was the base model. You are treating assumptions and cause and effect relationships incorrectly.

 

[warrior2000]

The financial impact is not that great and apple should focus on user experience.

How do you know how great the financial impact will be? Lets see a rough calculation.

 

[oldmacs]

Thanks for the kind compliments.

I'm a CPA and work at an investment bank. I think most who disagree with my points and Apple's pricing structure have no idea how real world finance works. They think "hey why not give the base iPhone 128GB" and not think of the potential impact it would have on the companies profitability AND long-term viability. Without strong earnings Apple cannot keep top talent, invest heavily in R&D, and provide the best user experience.

You have NO idea how Apple works. The reason Apple has thrived is that they have traditionally erred on the side of a better experience vs slightly higher profit margins.

People like you who can't see past the numbers are the sort that bring companies down, so hopefully you never go near Apple.

Again, apple has low spending on R&D. Very low. Considering 16GB of storage is not "the best user experience" then they've already failed that.

I ask again, why has apple the bothered upping the specifications at all, they'd have higher profit margins if they were selling the iPhone 5 (Which suites the needs of many) as their base iPhone?

 

[warrior2000]

Once again ignoring the basic reality that many people buy the base model because it's cheaper not because it works better for them. 8 GB would sell very well if that was the base model. You are treating assumptions and cause and effect relationships incorrectly.

show me FACTS that prove your ASSumptions

 

[geoff5093]

Very few smartphones start at 32GB. Samsung and LG and maybe one or two more. Most like Xiaomi, Levenovo, Windows phone, Moto, One+ all still start at 16GB.

So you say 128GB would obviously hurt Apple's bottom line. And you think starting at 32GB won't? LOL. Of course it will. There is still a very large market for 16GB iPhones so there is no reason for Apple to stop offering it.

By that logic Apple should never have changed from 8GB. Why improve the camera or CPU? Surely they could have saved money by going with last year's camera and CPU...

High-end Android phones start at 32GB, with mid ranged starting at 16GB (also a few hundred cheaper)

 

[redheeler]

Cause Apple wants to give customers a break. LOL

Dude, its all simple SUPPLY and DEMAND and price elasticity.

If the market determines 16GB is a ripoff they will stop buying 16GB phones and maybe even iPhones period. But there is no sign of that happening. The iPhone6 destroyed all types of records and the 6s is on pace to destroy the 6 records. So until those facts change I'm going to give Apple the benefit of the doubt.

There really isn't any FACTS that prove that the 16GB phone is hurting Apple or their popularity.

Because, as has already been explained, there are more factors than just storage. If storage was the only deciding factor, the iPhone would lose popularity for sure.

Plenty of people are willing to pay the extra $100 or suffer with too little storage to have an iPhone. That doesn't mean 16 GB is an exceptable amount of storage.

 

[warrior2000]

You have NO idea how Apple works. The reason Apple has thrived is that they have traditionally erred on the side of a better experience vs slightly higher profit margins.

People like you who can't see past the numbers are the sort that bring companies down, so hopefully you never go near Apple.

Again, apple has low spending on R&D. Very low. Considering 16GB of storage is not "the best user experience" then they've already failed that.

I ask again, why has apple the bothered upping the specifications at all, they'd have higher profit margins if they were selling the iPhone 5 (Which suites the needs of many) as their base iPhone?

Apple spend TWO BILLION on R&D last year and on pace for THREE BILLION this year. You call that low? Not to mention they bought Beats for $3 billion, Authentic for almost a billion, and two dozen other companies for several billion.

BTW, the iPhone 5S is their cheap model for $450 this year. See how nice Apple is?

 

[yg17]

No I'm not wrong. You just don't understand. Which is fine. You probably are not a finance professional.

And clearly neither are you because I know my financial adviser has better things to do during the day than argue over iPhone storage capacity on an internet message board.

 

[oldmacs]

There really isn't any FACTS that prove that the 16GB phone is hurting Apple or their popularity.

Lack of facts hasn't stopped you from this whole argument.

Very few smartphones start at 32GB. Samsung and LG and maybe one or two more. Most like Xiaomi, Levenovo, Windows phone, Moto, One+ all still start at 16GB.

Most premium smartphones do. EG the big players - LG, Samsung, Google Nexus, etc.

There is still a very large market for 16GB iPhones so there is no reason for Apple to stop offering it.

There is still a huge market for phones that are about as fast as the 4S or 5. Why does Apple not offer that?

 

[oldmacs]

Apple spend TWO BILLION on R&D last year and on pace for THREE BILLION this year. You call that low? Not to mention they bought Beats for $3 billion, Authentic for almost a billion, and two dozen other companies for several billion.

BTW, the iPhone 5S is their cheap model for $450 this year. See how nice Apple is?

Low compared with their revenue and low compared to other companies. Apple's R&D spending is not overly high given what they make and the money they have in the bank. And changing to 32GB on the base model iPhone (given sales are most likely to increase) will not mean less R&D spending.

What does it matter about the 5S?

 

[C DM]

show me FACTS that prove your ASSumptions

As soon as you show yours. Given that you have been making assumptions from the beginning and haven't supported any of them. You've been asked for proof many times not showing any and now resorting to asking for it yourself? As obvious of a ploy as any.

 

[warrior2000]

By that logic Apple should never have changed from 8GB. Why improve the camera or CPU? Surely they could have saved money by going with last year's camera and CPU...

High-end Android phones start at 32GB, with mid ranged starting at 16GB (also a few hundred cheaper)

The old CPU's could not run 64bit, TouchID, ApplePay, ect. Comparing onboard storage to CPU/GPU/RAM is ridiculous. CPU/RAM/GPU measures a phones processing power. Onboard storage just measure how much stuff you can put on your phone.

And what are all these High-end Android phones that start at 32GB? The only ones I know is the Samsung's and LG G4. Who else?