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Theory on iPhone 6 pricing and 64GB

R

Retired Cat

macrumors 65816
Original poster
Jun 12, 2013
1,210
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When iPhone 3G launched in 2008, the base price was $199 on contract. The $199 contract phones have usually been $649 at full retail.

$649 in 2008 dollars is worth about $717 in 2014, according to the BLS.gov CPI inflation calculator.

I'm wondering if Apple really intends the $749 64GB iPhone 6 to be the new "base" phone that most people will buy, while the 16GB is a loss leader of sorts to preserve the illusion of no price increase. $749 today is in purchase power terms about the same as $649 a couple years ago.
 
You're partly right in that they are pushing people even harder to spend the extra $100, and making it even less appealing to go with the base model, but it's definitely not losing them money.

Of course, this was discussed ad nauseum when the phones were announced. So, welcome to 3 weeks ago. ;)
 
Retired Cat said:
When iPhone 3G launched in 2008, the base price was $199 on contract. The $199 contract phones have usually been $649 at full retail.

$649 in 2008 dollars is worth about $717 in 2014, according to the BLS.gov CPI inflation calculator.

I'm wondering if Apple really intends the $749 64GB iPhone 6 to be the new "base" phone that most people will buy, while the 16GB is a loss leader of sorts to preserve the illusion of no price increase. $749 today is in purchase power terms about the same as $649 a couple years ago.
Click to expand...

I remember off contract iPhone 3G/3GS and 4 being $599 for base model, they didn't raise the price until the 4s generation. Sent from my iPad.
 
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Apple isn't going to sell anything at a loss. Just like Las Vegas isnt in business from all the winning gamblers.
 
tardman91 said:
Loss leader? Hahahahaha!
The iPhone 6 costs ~$200 to build and the iPhone 6+ ~$216.

https://www.macrumors.com/2014/09/23/iphone-6-parts-cost-samsung-a8/

Read the article. They're making even MORE now in profit margin than the original iPhone. They make very slightly less on the higher capacity models, but to suggest any iPhone might be a loss leader is laughable.
Click to expand...


Ok, I admit that "loss leader" is not the best phrase to convey what I am thinking. The 16GB has the same price as the old 16GB 5 and 5S to entice people to consider buying, and the jump to 64GB is the easy upsell.

I note that the article from Macrumors says that component costs start at $200 or so. This excludes R&D, marketing, tech support, and retail store costs, which will rise with inflation. Eventually the price of iPhone has to rise, unless the price of components falls more rapidly.
 
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