Why the iPhone X may not be "overpriced" at $999

[Deguello]

Demand, or lack there of for the iPhone X, will not change how fast the OLED screens can be produced. Apple's ability to produce at a higher rate is what is problematic.

From reading your posts, it is clear to me, that you have probably never owned a business, or been in a position of leadership in one, as your posts read as some 'pie in the sky still in the classroom' philosophy.

No, but demand will be lower at a higher price, which would establish a market equilibrium price rather than a shortage situation.

What businesses have you owned or lead such that you didn't raise prices when your product was selling faster than it could be produced?

 

[44267547]

SS Watches use sapphire covers instead of glass. That's where the extra cost comes from.

I'm aware of that. But I was referring to the actual manufacturing costs and materials. For the 316 L stainless, which is more costly over the 7000 Series aluminum. Not to mention Apple's own mark up for the product.

 

[HEK]

The question is not about the markup, it's about affordability and design considerations.

Apple spent a lot of money on OLED and cameras. Are those features worth it for the end user?

Another company may decide to spend their materials budget on 6 GB RAM instead. Does it translate to something worthwhile for end users?

Based on the inneficiencies of snapdragon chip over A11 chip other phones need 6 GB RAM to compete with 3 GB in iPhone. Plenty of testimonials about six month slow downs on other phones. I upgrade IOS to latest on my iPhone and find it is fast, efficient, and works seemlessly and flawlessly with everything I do. Tie in to my iPad and Mac Pro is also awesome and easy.

 

[_Refurbished_]

If it's "clearly overpriced" then they'll be sitting on the shelves unsold. What do you think the odds of that are?

"More than I'm will to pay" is not the same as "overpriced."

I don’t think it’s going to sell as many as previous iPhones. So yea, I think it’s overpriced. If there’s low supply, that’s not an indication of sales.

If we ever get the #’s, id bet money that sales will be lower for the X than previous designs.

 

[HEK]

Yes..maybe on the 6SS...but we both know Apple would never have called it that.

But I would still disagree on the ip8/+ name.

Yes, the CPU bump was generous, but the camera upgrades were within expected norms. And with wireless charging being the only new feature...I don't see how Apple can justify giving it the ip8 name even if the LCD screens were tweaked a little with truetone, etc.

Completely new body design. Apple has always gone with next number when external case changes.

 

[Deguello]

I don’t think it’s going to sell as many as previous iPhones. So yea, I think it’s overpriced. If there’s low supply, that’s not an indication of sales.

If we ever get the #’s, id bet money that sales will be lower for the X than previous designs.

Not selling as many doesn't mean it's overpriced. Having them sit unsellable would.

It may turn out that Apple overestimated demand. That might be a price issue or it might be some other issue. They may be overpriced, but the price standing alone doesn't answer that question.

 

[AJsAWiz]

What I don’t understand is how Apple having an 8 and an X is any different than a BMW 1 series vs a 7 series. The 7 obviously has more features and obviously costs more. Do people complain and cry they can’t afford a 7 series? No if they want a BMW at entry level price they get a 1 series. Same with Apple now. If you want a more affordable iPhone get an 8.

Yep, there's something for everyone all the way down to $349 (or was it $399). You pay for what you want or often what you can afford.

 

[_Refurbished_]

Not selling as many doesn't mean it's overpriced. Having them sit unsellable would.

It may turn out that Apple overestimated demand. That might be a price issue or it might be some other issue. They may be overpriced, but the price standing alone doesn't answer that question.

This is not a normal product. This is the iPhone. Even if they sell every iPhone X, it may not be as many as when the base model cost hundreds less. If they make less money selling fewer phones, than that would be a failure.

The iPhone X will sell, the question is how well, and how does it compare to previous models at a lower price point.

 

[AJsAWiz]

The iPhone is not overpriced.

If anything, it is underpriced.

It's increasingly clear that it will take months for people to get their hands on one. Demands is well and truly exceeding supply.

They should have doubled the price. It is an ultra premium product that should have been priced at ultra premium levels to curb demand.

There are plenty of other iPhone models for those who do not like paying high prices for phones.

That is true. Can't wait to see the demand at pre order time . . . maybe from some of the same people who might be complaining about pricing. Reminds me of those who watch a movie or TV show then complain about the content. At any point in time all one has to do is pull the plug or change the channel. Hope I'm not stepping on anyone's toes as that was, sincerely, not my intent. Just sharing my observations.

 

[_Refurbished_]

Not selling as many doesn't mean it's overpriced. Having them sit unsellable would.

It may turn out that Apple overestimated demand. That might be a price issue or it might be some other issue. They may be overpriced, but the price standing alone doesn't answer that question.

Pretty strong opinions so far. More than 80% of voters this far think it’s overpriced.

Now imagine what happens when we ask the people that don’t hang out in iPhone forums....

 

[HEK]

Pretty strong opinions so far. More than 80% of voters this far think it’s overpriced.

Now imagine what happens when we ask the people that don’t hang out in iPhone forums....

Of 23 people? Totally meaningless, not a good data sampling, not a good poll, totally worthless to represent what millions of people world wide will do. We just gonna have to wait and see.

But based on past performance, my money is on the iPhone X to be quickly sold out and in short supply for 3-6 months.

Besides ALL high end phones are overpriced. Selling with profit margins more than 6% is overpriced. Only thing more overpriced is cucumber infused water at Whole Foods for $15 a pint.

 

[The-Real-Deal82]

I don't think you'll find many people on the street who don't think the iPhone X is overpriced. That's pretty much been the theme of discussion on tech sites and world news for the past week before the features of the phone are mentioned. I'm sure the limited numbers that are available will sell out fast however but simple rules of economics suggest it won't be on every iPhone users shopping list due to its strangely high price point.

Apple will have to put more effort in next year when providing the mid tier option iPhone as this serves the lions share of their user base. Another incremental upgrade may not be enough to satisfy the market and they'll need to filter some of the features from this years X onto the iPhone 8S or 9, whatever they call it.

 

[MrX8503]

How is that question related at all to your original post? Doesn't make sense.

You're looking at a flat rate of profit margin, when that doesn't give you the entire picture. There's a reason why Apple reports profit margins in %.

 

[Jimmy James]

What I don’t understand is how Apple having an 8 and an X is any different than a BMW 1 series vs a 7 series. The 7 obviously has more features and obviously costs more. Do people complain and cry they can’t afford a 7 series? No if they want a BMW at entry level price they get a 1 series. Same with Apple now. If you want a more affordable iPhone get an 8.

I think the problem is one of entitlement. Many people could always afford the newest smartphone. Now, that's going farther out of reach and they don't like it.

 

[Deguello]

This is not a normal product. This is the iPhone. Even if they sell every iPhone X, it may not be as many as when the base model cost hundreds less. If they make less money selling fewer phones, than that would be a failure.

The iPhone X will sell, the question is how well, and how does it compare to previous models at a lower price point.

If they sell every iPhone X at price $X, it would be foolish, and less profitable, to sell any at $X-1 or less.

It may well be that the X is overpriced. Again, though, the price in a vacuum can't answer that. And neither can a poll of self-selected users.

If the X sits unsold, it was overpriced. If the X sells out, it wasn't. Like a lot of things, it can probably be priced higher at first as more buyers are chasing fewer phones.

If the X were essentially the Plus form factor with smaller bezels, I'd be buying one at the listed price. Since the screen is narrower and notched, I won't be. They'd have to price it less -- substantially less than the Plus -- for me too want it.

 

[_Refurbished_]

If they sell every iPhone X at price $X, it would be foolish, and less profitable, to sell any at $X-1 or less.

It may well be that the X is overpriced. Again, though, the price in a vacuum can't answer that. And neither can a poll of self-selected users.

If the X sits unsold, it was overpriced. If the X sells out, it wasn't. Like a lot of things, it can probably be priced higher at first as more buyers are chasing fewer phones.

If the X were essentially the Plus form factor with smaller bezels, I'd be buying one at the listed price. Since the screen is narrower and notched, I won't be. They'd have to price it less -- substantially less than the Plus -- for me too want it.

Let’s just agree to disagree.

Self-selected users in a pro-Apple rumors forum. While it’s a small sample size....80% is pretty convincing thus far.

If their new, cutting edge phone doesn’t sell as well as previous models, it’s because of the price. If it continues to sell as many units as, previous models....they priced it accordingly.

Time will tell.
[doublepost=1505918049][/doublepost]

Of 23 people? Totally meaningless, not a good data sampling, not a good poll, totally worthless to represent what millions of people world wide will do. We just gonna have to wait and see.

But based on past performance, my money is on the iPhone X to be quickly sold out and in short supply for 3-6 months.

Besides ALL high end phones are overpriced. Selling with profit margins more than 6% is overpriced. Only thing more overpriced is cucumber infused water at Whole Foods for $15 a pint.

80% if voters on a Pro Apple forum site is small in numbers, but telling. I haven’t met a single person that isn’t into tech, that wants to buy one. Why? It’s $1000 and they are all happy with their phones.

It’s an iPhone. It will sell. It won’t have supply (neither did a three year old designed iPhone 7). Supply is a huge factor and there’s usually very little info about supply to make a logical conclusion about sales.

Just because it’s sold out does not mean it’s not overpriced. If you sell out of a $10,000 iPhone XxX, but only 1000 were made.....it doesn’t mean the $10,000 iPhone wasn’t overpriced. It means they sold the stock that they had. Once it’s in stock, how many consumers walk into an Apple store, pick up an X, and walk out. Not as many as previous designs with lower pricing.

I think Apple is getting a bit overconfident (and for good reason) pricing the X this high. If they don’t talk about X sales, we’ll know why.

 

[Oliveira46]

I didnt realize the 1 series and 7 series shared the same engine/transmission internals.

It's more like deciding to get base 1 series vs a 1 series with a moonroof.

Well, actually you can buy a 1 series with same drivetrain as a 7 series (3 liter twin turbo + ZF Gearbox). BMW 140i and BMW 740i. THe iphone X costs 50% more, the 740 costs more than 100% the price of the 140

 

[tperry]

Out of 10 iPhone users that work at a local Dr's office that I do IT work for (and that are planning on upgrading their iPhones), only 1 said they were getting the iPhone X. All the rest said that was more money than a phone was worth.

I'm still personally on the fence on whether to get one now or give Apple it's typical time to get the bugs out by letting the public test it.