Tim Cook on iPhone Prices: 'We Want to Serve Everyone'

[Wiesenlooser]

This is not the case if you compare the more reasonable models. The iPhone 7 128 GB costs in Germany at launch 2016 869€. The XR costs with 128 GB 909€. That is 40€ difference and about 5% increase for 2 years of inflation and a much better product....(besides: the iPhone 7 32 GB had a starting price of 759€ in 2016 and not 699€...)

that's a really stupid argument on many levels.


If you can justify the higher price due to the better technology then why don't laptops nowadays cost 5 Million USD, given how much faster they are compared to let's say 1990?

Technology companies are EXPECTED to improve specs on their newer models. Otherwise people would stop buying new ones.

128 GB SSD storage nowadays are much cheaper than in 2016.

 

[Ghost31]

...by serving no one.

2 billion iOS devices sold. “Servicing no one”

Amazing how blind some people are to reality just to hate a company

 

[bladerunner2000]

And there’s nothing wrong with that.

Actually, there is. Unless you don't respect your own country and allow it to rot by having incompetent losers being appointed for the most important job in the country.

 

[iosuser]

Can someone explain the difference?

Video Playback (From Apple.com)

Xr: Supports Dolby Vision and HDR10 content

Xs: High Dynamic Range with Dolby Vision and HDR10 content

Thanks!

It means the XR will play DV and HDR10 contents but displayed as standard dynamic range since the screen is not HDR capable.

 

[Sackofnickels]

So much whining in here. I hate the pricing too, but I love the phones and know they're a business, not a charity. At those prices, they're going to sell an enormous amount of phones.

They're also selling luxury items that no one needs to survive. Just don't buy the products if you are that pissed off at the prices. Getting all butthurt about the pricing of a luxury item is ludicrous. The interview was a bit disingenuous, but what did you honestly want him to say? We're a corporation and we priced these products to net us the greatest gross margin?

I am not sure if I would agree with the term luxury item. The iPhone is expensive because Apple wants it to be. Granted it uses some proprietary components, but it is very similar to cheaper phones in a lot of ways including the use of technology. In other words it's just another phone but it costs more.

I would consider these offering luxury phones:

https://www.ebay.com/i/162698800042?chn=ps

https://steemit.com/phone/@cyrus.pasargad/blackdiamond-vipn-smartphone

https://bellperre.com/configurator/configure/23211/

 

[Zdigital2015]

Nope. Doing quite well, thanks.

No company will execute an anti-cannibalization plan that includes reselling the pulled product. That's literally the reason for the plan itself. No resale. Do your homework before spouting off.

Good, glad to hear it.

I'm sure the Donner party could have used one of those, but I digress.

Apple's reduces their channel inventory by allowing the judicious use of discounts that it authorizes carriers as well as retail outlets in order to adjust the supply chain inventory on a running basis thereby minimizing the total channel inventory left, especially before a new product is introduced. Apple does not pull product from the shelf, just ask B&H or Best Buy why they are still selling highly discounted 2015, 2016 and 2017 MacBook Pros. I do not hear any rumors of them being pulled to make way for the 2018 models. Apple's refurbished inventory of 15" MacBook Pros is slim at best to non-existent.

Besides, Apple only discontinued one current product line that it actually had to stop production on (iPhone X) and shift over to iPhone Xs and Xs Max production, while the iPhone 6 and 6s line probably all got shifted over to make room for the Xr. The iPhone 7 and 8 lines simply begin reduced production volumes based on historical data to decide on the projected volume needed. Based on their Q4 results, Apple was building about 458,000 iPhones a day (41.6 million/90 days in the quarter), discounting what had already been built that was currently in channel. They are extremely good at massaging the channel to make sure they do not have an over abundance of unsold stock at any given time. Occasionally, you will see that they are out of stock or that stock is not immediately available. Based on this, I would imagine the amount of iPhone X units that was in the channel was already extremely low as they had to begin gearing up for production of the new models at least 90 days ago. Assuming no production glitches, they may need close to 30 million units for sale by next week as they will have launch day availability 30 countries, which means they needed at least 60 days for production. This also explains the staggered roll out of the iPhone Xr the following month.

Have you ever wondered why Apple only offers the iPhone 7 and 7 Plus models in their refurbished store? Because they have minimal channel inventory in the first place and any remaining iPhone X models will be discounted at retail (not Apple Stores), used as customer replacements or sold as "refurbished" with minimal warranty and discounting for MVNPs such as Boost, Virgin, Straight Talk, MetroPCS, etc.

There is no anti-canniblization plan because they do not need one. There is no waste at Apple. Remember, this is the company that removed a cable that was free when you purchased it with your $2799 MacBook Pro - the Power Adapter Extension Cable - and now they will sell it to you for $19.

I did my homework, your theory is flawed and represents horse and buggy thinking, at least where Apple's supply chain is concerned.

 

[femike]

Tim Cook speaks a load of rubbish. The cheaper phones have 2 year old tech. It cannot be compared. They could offer 5 year old tech and be even cheaper still. If he wants to talk like that, then they should offer the same tech spec at lower price points, not old products, nor cheaper specs. Apple's CEO needs some integrity.

 

[Michael Scrip]

Nor does Apple now offer a single phone which is anything but rather huge.

It's crazy that it took 7 years for Apple to finally release a big phone... and just 4 years later all they make are big phones.

You're right... they need a smaller phone for those who want one.

 

[blco02]

Tim Cook doesn’t care about the little guy

 

[xraydoc]

"We always thought ... that if you provide a lot of innovation and a lot of value, there is a segment of people who are willing to pay for it," Cook said. "For us, it's a large enough group of people that we can make a reasonable business out of it."

I take this to mean: "We're selling so many flagship phones that clearly we're not charging enough for them. Must raise prices since we obviously can get away with it."

Yes, Apple got to be a $1T company for something, and it's a business, not a charity, but this just feels a little sleezy to me.

 

[I7guy]

Actually, there is. Unless you don't respect your own country and allow it to rot by having incompetent losers being appointed for the most important job in the country.

PRSI material, mods will delete post if they see it. You can start a thread in PRSI to discuss this.

 

[oldmacs]

Well, if last year was any indication, people here will complain a ton as usual, and Apple will still go on to sell a ton of iPhones. Next their next earnings, Apple will announce higher profits, and the cycle rinses and repeats. ¯\_(ツ)_/¯

And Apple becomes the Microsoft of the early 2000s.

 

[I7guy]

... The iPhone is expensive because Apple wants it to be. Granted it uses some proprietary components, but it is very similar to cheaper phones in a lot of ways including the use of technology. In other words it's just another phone but it costs more...

Question: Then why is the note 9 just as expensive?

Answer, because Samsung wants it to be must be the correct answer.

 

[Abazigal]

I am not sure if I would agree with the term luxury item. The iPhone is expensive because Apple wants it to be. Granted it uses some proprietary components, but it is very similar to cheaper phones in a lot of ways including the use of technology. In other words it's just another phone but it costs more.

I would consider these offering luxury phones:

https://www.ebay.com/i/162698800042?chn=ps

https://steemit.com/phone/@cyrus.pasargad/blackdiamond-vipn-smartphone

https://bellperre.com/configurator/configure/23211/

Rather, the iPhone is expensive because Apple knows their users are willing to pay that much for their products.

It’s simple economics here. You charge what the market can bear.

 

[ipponrg]

I am not sure if I would agree with the term luxury item. The iPhone is expensive because Apple wants it to be. Granted it uses some proprietary components, but it is very similar to cheaper phones in a lot of ways including the use of technology. In other words it's just another phone but it costs more.

I would consider these offering luxury phones:

https://www.ebay.com/i/162698800042?chn=ps

https://steemit.com/phone/@cyrus.pasargad/blackdiamond-vipn-smartphone

https://bellperre.com/configurator/configure/23211/

The easiest way to determine if something is luxury is to see how culture responds. The fact that Hermes created special Apple bracelets, the existence of $1300 cases, and the passive endorsement by celebrities in Hollywood are all symptoms of luxury.

Apple from the beginning has always been a higher priced item. It's only of recent years has it been less utilitarian and more flashy. The fact that Apple hired Burberry's former CEO to run their stores should say a lot about what their goals were.

 

[Sackofnickels]

Question: Then why is the note 9 just as expensive?

Answer, because Samsung wants it to be must be the correct answer.

Samsung is competing with Apple so it charges similar prices. Not really rocket science. Still not a luxury item in my opinion.
[doublepost=1536898179][/doublepost]

Rather, the iPhone is expensive because Apple knows their users are willing to pay that much for their products.

It’s simple economics here. You charge what the market can bear.

Understood. Still not what I consider a luxury item, just a phone priced at what the market will bear.
[doublepost=1536898622][/doublepost]

The easiest way to determine if something is luxury is to see how culture responds. The fact that Hermes created special Apple bracelets, the existence of $1300 cases, and the passive endorsement by celebrities in Hollywood are all symptoms of luxury.

Apple from the beginning has always been a higher priced item. It's only of recent years has it been less utilitarian and more flashy. The fact that Apple hired Burberry's former CEO to run their stores should say a lot about what their goals were.

So all these millions of people from all over the world, from kids and old people, to the rich and poor all enjoying the status of owning an iPhone and that is considered a luxury item? I read there have been 700 million sold. I would think the term Luxury is being tossed around pretty loosely, considering just about everyone has one. Running water used to be considered a luxury too.

 

[pratikindia]

In India, the pricing is insane

XR - 76,900 - 91,900 INR (1071 - 1280 USD)
XS - 99,900 - 1,34,900 INR (1391 - 1879 USD)
XS Max - 1,09,900 - 1,44,900 INR (1531 - 2018 USD)

 

[Nicky G]

*due to how contracts used to work in the US

You realize that kind of invalidates your entire argument, right? You're conveniently neglecting to mention all the money you absolutely paid on top of those numbers for the phones you used. You can do something very similar these days through their monthly payment plans, you know...

 

[Sevendaymelee]

Cook - "We want to serve everyone."

Jobs - "That's been one of my mantras - focus and simplicity. Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple. But it's worth it in the end because once you get there, you can move mountains."

 

[Nicky G]

I think it's pretty funny how freaked out about the price of these things people get.

If you keep your phone for 3 years, totally possible these days with how nuts these things have gotten, think about how it prices out:

$1000 / 3 years = ~$333/year = ~91 cents a day

LTE Advanced phone plan all the bells and whistles, let's call it $60/month, or $2/day

For less than $3/day, you can basically be a cyborg connected to all of the world's people and information.

And people all the heck over the place from what I can see gladly spend $6+ a day at Starbucks on an absolutely crappy covfefe.

I def see a ton of people huffing down $10+ of cigarettes a day.

Think about aaaallllll of the utterly useless crap people spend $3+ a day on.

Now think about it again -- you can basically become a cyborg but instead of nasty surgery and infections you get this cute little tablet thing in multiple colors you can put stickers on, and wham, you are connected to all of the world's people and information.

I must be getting old. I'm 40 now. Been using Apple products for 35 years.

2018. When people complained about how paying half the price of a crappy latte per day to connect to all the world's people and information was too too expensive.

Sheesh.

 

[macdisciple]

What by removing the low price option?

By removing the small screen option?

7 and 8 are your sm screen options. my wife and i both got 8s with a BOGO offer from Verizon two months ago. I ipgraded from an SE reluctantly but honestly have enjoyed the larger screen and compact design of the 8.

 

[cyb3rdud3]

The

Irish price is VAT included. Very simple...and the phone can be opened and taken home so it doesn’t need to be declared. My MacBook Pro is a perfect example of this. It’s only illegal if it’s still in box with receipt.

Ok I’m leaving it here in the silly price comparisons. So you are not comparing pre Tax price, but one pre Tax with Tax evasion and one fully paid up.

Ok, we are getting somewhere. So my calculation was wrong because I had the audacity to stay legal.

And no, it is not only illegal if it is still in the box with the receipt. It is illegal full stop. What the changes are of getting caught is another matter.

But for the benefit of general discussion it would be really helpful to stick to legal comparisons, and then especially not call out other forum members to have their calculations wrong because they don’t into account your intended tax evasion.

You seen, this boring stuff can all be avoided by simply comparing prices pre Tax.

 

[Nicky G]

By the way, it seems worthwhile mentioning that ~$1000 for highly advanced electronics is not a "luxury product."

Hermes sells basic men's leather wallets for over $1500. Very basic leather card holders and change purses that are hundreds of dollars each. You want a nice men's scarf? Could easily be $800.

Those are luxury items. But like super starter ones. The crazy stuff can be $80,000 handbags, quarter-million-dollar watches. It keeps going up from there.

Just because something is marketed aspirationally to look like a luxury good, does not really make it so. Aspirational marketing is fine, this is one of the reasons Apple brought in Angela to run retail (in addition to management skills). But don't confuse aspirational with the real deal.

 

[I7guy]

Samsung is competing with Apple so it charges similar prices. Not really rocket science. Still not a luxury item in my opinion.

The agree, they’re premium consumer electronics. Point is Apple isn’t the only one charging high prices.

 

[kstotlani]

Please explain, I have an X64gb and don’t even use half that storage.

Music and pictures are in the (i)Cloud and everything else doesnt take up a lot of space.
I have huge playlists, 4 pages of apps and a ton of pics dating back to 2009 all accessible anywhere I go. And not even 32GB used.

What are y’all doing with all that storage in the time of LTE and Cloud?

How much have you paid for iCloud collectively over these years? Cellular speed can be a problem for many. The issue isn’t that 64GB is enough or not for you but for all use cases. I don’t think it is wise to pay for iCloud every month. I would rather have a large capacity on the phone and back up locally on my laptop or even my NAS.