Who said they were? I suggest $250 which would give them some kind of margin for the 3GS, or cheapest device.
And again, your logic for wanting this is? "I want it."
You haven't yet offered a single cogent argument for your price points. It's always "this is what I think they could possibly charge, so they should".
And again, the reason you're wrong is that you always charge what the market will bear. This is a business maxim that goes back thousands of year (literally, it's found in Greek and Latin).
Apple is clearly charging what the market will bear, at least in the markets it cares about. If there is any interesting question here, it's why they're not interested in the prepaid market. And frankly, the answer to that seems obvious.
No. Consumers do not "pay much less than that". Consumers pay more than that if they go with a contract - they pay much less up front but essentially what they've done is taken out a high-interest loan from their carrier and used it to pay Apple for the phone.
That would be true if we didn't pay the same monthly price regardless if your phone was subsidized or not. If you buy an unlocked phone from Apple and take it to a carrier (at least here in the US), you pay the same monthly service price as the guy who got his iPhone for 1/3 the price you paid.
I'm not saying it's right. It's wrong. Very wrong, in my opinion. But since the ongoing monthly cost is the same, then yes people who go with a subsidized phone pay a much lower price.
That would be true if we didn't pay the same monthly price regardless if your phone was subsidized or not. If you buy an unlocked phone from Apple and take it to a carrier (at least here in the US), you pay the same monthly service price as the guy who got his iPhone for 1/3 the price you paid.
With the mainstream carriers here in the UK, that isn't true (they all offer "SIM only" tariffs which cost less than contracts which offer phone "subsidies"). Beyond that, there are plenty of MVNOs who quite literally offer exactly the same service as the mainstream carriers for vastly less per month; one of the main reasons the MVNOs can do this is that they don't "subsidise" any phone purchases.
This article is lame, let companies like Nokia handle the third world needs with low end cells. The margins are just to damn small for a company like Apple to even think about creating such a line of phones. Yes Nokia is the largest phone manufacturer in the world because of the sheer volume of phones they produce but they are defiantly far from being the most profitable. That title goes to Apple at the moment. I'm so tired of these articles, what the hell do they want, for Apple to manufacture an entire line of phones covering every spectrum of the market. Not only does that go against every philosophy that Apple holds dearly about manufacturing cheap crap but every Fed in Washington would be knocking down the doors of Apples headquarters screaming monopoly, if that hasn't happened already.
People in most developing countries also drive more Tatas and Kias than Porsches. So should Porsche produce a cheap car too?
Apple has done well with its current strategy. It needn't have the majority market share to dominate a market. If Apple were to produce a cheap iPhone it would only serve to dilute the aura the current iPhone has thus making it just another commodity. Is that what everyone wants? I don't think so.
People in most developing countries also drive more Tatas and Kias than Porsches. So should Porsche produce a cheap car too?
Apple has done well with its current strategy. It needn't have the majority market share to dominate a market. If Apple were to produce a cheap iPhone it would only serve to dilute the aura the current iPhone has thus making it just another commodity. Is that what everyone wants? I don't think so.
Porsche does make a cheap car, they call it a Boxster or Cayenne...
Anyways, Apple could capitalize on the ever growing prepaid industry here in the US and abroad that increases by the millions every quarter. If Apple had a $300 phone model that would put it on the premium end of the prepaid market, but is still relatively obtainable to the masses.
Look at the lineup of Prepaid smartphones among various carriers, they are all pretty weak powered with dismal features or grossly overpriced for mediocre hardware. Right now the best bet is to buy a used smartphone and activate it with the way some of these look.
Imagine a $300 iPhone 4 (this is assuming the 3GS dies this year, and Apple will go with a iPhone 4/4s/5? lineup) that is also free on contract. That would be a game changer in my opinion and in no way takes from the higher line up.
The way to attack Apple is obviously price. Their technology is too far out on the bleeding edge for anyone to catch right now on that front. For instance, I use Apple products at home, but Micro Center was selling completely capable Windows 7 laptops with 16" screens for $250! To a certain, significant segment of the market, Apple can't touch that. And actually, having purchased one of these on impluse (after swearing I never would buy a Win machine again) I gotta admit - the technology is pretty good, things have not been stagnant by other vendors. Same thing applies to phones.
Apple can continue to dominate, no doubt, but it will need to be driven by great products, exquisitely executed, so that the bottom feeders are forced to play continuous catch-up. It should be interesting...
There will always be bottom-feeders making products for other bottom-feeders.
?There is nothing in the world that some man cannot make a little worse and sell a little cheaper, and he who considers price only is that man's lawful prey.? ?John Ruskin
Apple needs to remain a premium brand, selling premium products to customers who appreciate it.
...
Apple is not for cheapskates!
Bravo!!
But this feels like Windows all over again. The general population is happy with "good enough". As technology improves, the difference between Apple's offering and the competition will become narrower and narrower (feature-wise). At the end of the day, the user experience will continue to be the reason to choose Apple.
As people have said ? Steve: "We won't ship junk."
IE apple does not care about the low end markets. Let Android have them, no big deal. It will just re-enforce the perspective that Android is generic and iOS is premium. (I'm not saying that's a fact, but over time, this works out worse for Android in terms of quality of brand then it does for apple)
It takes about the same time and effort to produce a cheap product as it does to produce and better product. So, why chase the bottom end of a market where there is little profit when Apple can continue to cement their ownership of the top half?
Besides, Apple can sell every phone they can make... Until it becomes possible to make more phones then they can sell to the top tier, why even be concerned about the bottom tier? The bottom tier will always be there and an Android sale down at that level is not like Apple lost that customer forever. The bottom tier knows that there is better stuff and will dream about someday being able to afford it. Of course, there is the bottom of the bottom tier that has no idea of what they bought... "a phone's a phone, aint it?"
I just spent two months in India. Buying any Apple products there is hard. Bangalore has an excellent iStore on MG road (near the Barton Centre, which I found was not named after Bob Barton, the original think different designer of the Burroughs B5000).
India has quite a different paradigm at the opposite end of Apple Stores. People like going to these little hole-in-the-wall places. It is capitalism and freedom in the extreme, and sometimes unpleasantly so without usual consumer protections. In Madurai there were about 100 stores in one market all selling mobile phones, none selling Apple. Samsung was even advertised showing pictures of iPhone.
Developing countries are big into mobile phones - the land lines tend to be rubbish or non-existent. The rates are very cheap maybe 1rs (2c) per minute. However, try to buy an iPhone and it's over $800!
Major networks include AirTel, AirCel, Vodaphone, Tata Communications. Tata are a huge company producing the Tata Nano car (iPhone Nano?), founded the national airline (Tata Airways became Air India) but also huge computer consultants and have historically been associated with computers through partnerships like Tata Burroughs (at least India got the best computers).
Getting into these markets requires some radical thinking.
Apple has never pretended to offer a product for everyone. They offer a quality, industry leading product. If you can't afford it, you're free to go elsewhere.
If you look at the results over the past decade, there's nothing wrong with that strategy. Indeed, by attempting to become the leader in terms of volume, Apple would probably have to make so many sacrifices that their long term success would be in jeopardy.
Choose what you're going to do, do it to the best of your ability, and ignore markets that don't interest you.
Lol thats almost word for word a quote from jobs
He said something to the effect that if we can't do something amazing and totally different in a particular area in a market we don't. We only focus on the areas that we can do amazing things and make a difference.
This explains why most of us know very few people with Android phones and lots of people with iPhones. We don't live in countries where people are poor and phones aren't subsidized.
I doubt Apple is particularly concerned. This explains a lot more about the nature of Android market share than a problem for Apple.
Actually, it seems apple people hang around apple people thus you "see" most people with apple products. I have no such proclivity. Just going to any event, venue or location and truly looking around and you will see that most people are using android phones. This matches up with the market share reports from all the various reporting companies that android has the majority marketshare in every country worldwide. Thus, "most" of us know very few people with iphones and lots of people with android. And just to clarify, I have a macbook pro (running windows and OSX dual booted) so I am not against apple but just find their phones inferior in every way to android from hardware (fact) to OS (opinion).
I just spent two months in India. Buying any Apple products there is hard. Bangalore has an excellent iStore on MG road (near the Barton Centre, which I found was not named after Bob Barton, the original think different designer of the Burroughs B5000).
India has quite a different paradigm at the opposite end of Apple Stores. People like going to these little hole-in-the-wall places. It is capitalism and freedom in the extreme, and sometimes unpleasantly so without usual consumer protections. In Madurai there were about 100 stores in one market all selling mobile phones, none selling Apple. Samsung was even advertised showing pictures of iPhone.
Developing countries are big into mobile phones - the land lines tend to be rubbish or non-existent. The rates are very cheap maybe 1rs (2c) per minute. However, try to buy an iPhone and it's over $800!
Major networks include AirTel, AirCel, Vodaphone, Tata Communications. Tata are a huge company producing the Tata Nano car (iPhone Nano?), founded the national airline (Tata Airways became Air India) but also huge computer consultants and have historically been associated with computers through partnerships like Tata Burroughs (at least India got the best computers).
Getting into these markets requires some radical thinking.
My wife is from the philippines and it is the same thing there. No one can afford an iphone there. Wages are on average of $100/month and that is working 12 hours a day, 6 days a week. Going to Manila to the 2nd largest mall in the world, Mall of Asia, and after walking around all day, i never saw one iphone in a store or in use anywhere. Most people still use non smart phone's and those that can afford a smart phone, have android phone's. I can attest that in the philippines, people are crazy for android. I took my Droid 3 with us and got stopped all the time to show people and got "oohs and aahs". My wife's family thought me a rock star with my fancy phone. No one I talked to and I mean "NO ONE" thought the iphone a cool phone there. They just thought it an overpriced phone for silly american's.
But this feels like Windows all over again. The general population is happy with "good enough". As technology improves, the difference between Apple's offering and the competition will become narrower and narrower (feature-wise). At the end of the day, the user experience will continue to be the reason to choose Apple.
Hardware and feature wise, android already surpassed iOS. The "user experience" arguement is purely subjective. I find the iphone OS to be difficult to maneuver and not at all logical. However, android just makes sense to me. But then again, Linux makes even more sense than any other OS out there including Android so that's not saying much. My mom's neighbor wanted to get a new phone and heard about "all these smart phone' and asked if I could take her to get one. I took her to verizon and let her look around. The sales guy tried to get her on an iphone, i laughed as she could not figure it out at all (she's 67). The sales guy kept telling her how it was superior, great user experience, easy to use, etc. but she just told him "it ain't easy to me". She then looked at some samsung phone running android and asked why it cost's so much less if it does the same thing as the other phone? The guy had no answer for this old lady. She picked it up, he had to show her how to use it and explain it but she just "got it". She ended up picking an android smart phone of her own volition. She liked the larger screen and text, found the iphone confusing and too small to use with her jittery fingers. She shares things all the time with my mom on Google+ and gmail and just loves it. In the end, the user experience is found to be equal if not better on android consistently which contributes to the 49% marketshare world wide. Sure cost is a factor, but I have more money than you can imagine and I still would not spend $800 for a phone no matter what it is (even android!). Especially when one can be had for much less that does much more and faster.
Comments
Who said they were? I suggest $250 which would give them some kind of margin for the 3GS, or cheapest device.
And again, your logic for wanting this is? "I want it."
You haven't yet offered a single cogent argument for your price points. It's always "this is what I think they could possibly charge, so they should".
And again, the reason you're wrong is that you always charge what the market will bear. This is a business maxim that goes back thousands of year (literally, it's found in Greek and Latin).
Apple is clearly charging what the market will bear, at least in the markets it cares about. If there is any interesting question here, it's why they're not interested in the prepaid market. And frankly, the answer to that seems obvious.
No. Consumers do not "pay much less than that". Consumers pay more than that if they go with a contract - they pay much less up front but essentially what they've done is taken out a high-interest loan from their carrier and used it to pay Apple for the phone.
That would be true if we didn't pay the same monthly price regardless if your phone was subsidized or not. If you buy an unlocked phone from Apple and take it to a carrier (at least here in the US), you pay the same monthly service price as the guy who got his iPhone for 1/3 the price you paid.
I'm not saying it's right. It's wrong. Very wrong, in my opinion. But since the ongoing monthly cost is the same, then yes people who go with a subsidized phone pay a much lower price.
That would be true if we didn't pay the same monthly price regardless if your phone was subsidized or not. If you buy an unlocked phone from Apple and take it to a carrier (at least here in the US), you pay the same monthly service price as the guy who got his iPhone for 1/3 the price you paid.
With the mainstream carriers here in the UK, that isn't true (they all offer "SIM only" tariffs which cost less than contracts which offer phone "subsidies"). Beyond that, there are plenty of MVNOs who quite literally offer exactly the same service as the mainstream carriers for vastly less per month; one of the main reasons the MVNOs can do this is that they don't "subsidise" any phone purchases.
iPhones are only going to be top of the tree in 1st world countries.
Dumb, dumb ....... dumb story.
Apple has done well with its current strategy. It needn't have the majority market share to dominate a market. If Apple were to produce a cheap iPhone it would only serve to dilute the aura the current iPhone has thus making it just another commodity. Is that what everyone wants? I don't think so.
But, as a consumer, do I want to be providing more profit for each product I purchase?
Yes. Because that way you can brag that YOU are a better person for choosing "the winner".
People in most developing countries also drive more Tatas and Kias than Porsches. So should Porsche produce a cheap car too?
Apple has done well with its current strategy. It needn't have the majority market share to dominate a market. If Apple were to produce a cheap iPhone it would only serve to dilute the aura the current iPhone has thus making it just another commodity. Is that what everyone wants? I don't think so.
Porsche does make a cheap car, they call it a Boxster or Cayenne...
Anyways, Apple could capitalize on the ever growing prepaid industry here in the US and abroad that increases by the millions every quarter. If Apple had a $300 phone model that would put it on the premium end of the prepaid market, but is still relatively obtainable to the masses.
Look at the lineup of Prepaid smartphones among various carriers, they are all pretty weak powered with dismal features or grossly overpriced for mediocre hardware. Right now the best bet is to buy a used smartphone and activate it with the way some of these look.
Imagine a $300 iPhone 4 (this is assuming the 3GS dies this year, and Apple will go with a iPhone 4/4s/5? lineup) that is also free on contract. That would be a game changer in my opinion and in no way takes from the higher line up.
Porsche does make a cheap car, they call it a Boxster or Cayenne...
Sorry, but that's not a cheap car by any standards.
It's lower than Porsche's other cars, but few people are going to call a $48 K or $65 K car 'cheap'.
The way to attack Apple is obviously price. Their technology is too far out on the bleeding edge for anyone to catch right now on that front. For instance, I use Apple products at home, but Micro Center was selling completely capable Windows 7 laptops with 16" screens for $250! To a certain, significant segment of the market, Apple can't touch that. And actually, having purchased one of these on impluse (after swearing I never would buy a Win machine again) I gotta admit - the technology is pretty good, things have not been stagnant by other vendors. Same thing applies to phones.
Apple can continue to dominate, no doubt, but it will need to be driven by great products, exquisitely executed, so that the bottom feeders are forced to play continuous catch-up. It should be interesting...
There will always be bottom-feeders making products for other bottom-feeders.
?There is nothing in the world that some man cannot make a little worse and sell a little cheaper, and he who considers price only is that man's lawful prey.? ?John Ruskin
Sorry, but that's not a cheap car by any standards.
It's lower than Porsche's other cars, but few people are going to call a $48 K or $65 K car 'cheap'.
I think his point flew high over your head...
Apple needs to remain a premium brand, selling premium products to customers who appreciate it.
...
Apple is not for cheapskates!
Bravo!!
But this feels like Windows all over again. The general population is happy with "good enough". As technology improves, the difference between Apple's offering and the competition will become narrower and narrower (feature-wise). At the end of the day, the user experience will continue to be the reason to choose Apple.
As people have said ? Steve: "We won't ship junk."
IE apple does not care about the low end markets. Let Android have them, no big deal. It will just re-enforce the perspective that Android is generic and iOS is premium. (I'm not saying that's a fact, but over time, this works out worse for Android in terms of quality of brand then it does for apple)
It takes about the same time and effort to produce a cheap product as it does to produce and better product. So, why chase the bottom end of a market where there is little profit when Apple can continue to cement their ownership of the top half?
Besides, Apple can sell every phone they can make... Until it becomes possible to make more phones then they can sell to the top tier, why even be concerned about the bottom tier? The bottom tier will always be there and an Android sale down at that level is not like Apple lost that customer forever. The bottom tier knows that there is better stuff and will dream about someday being able to afford it. Of course, there is the bottom of the bottom tier that has no idea of what they bought... "a phone's a phone, aint it?"
India has quite a different paradigm at the opposite end of Apple Stores. People like going to these little hole-in-the-wall places. It is capitalism and freedom in the extreme, and sometimes unpleasantly so without usual consumer protections. In Madurai there were about 100 stores in one market all selling mobile phones, none selling Apple. Samsung was even advertised showing pictures of iPhone.
Developing countries are big into mobile phones - the land lines tend to be rubbish or non-existent. The rates are very cheap maybe 1rs (2c) per minute. However, try to buy an iPhone and it's over $800!
Major networks include AirTel, AirCel, Vodaphone, Tata Communications. Tata are a huge company producing the Tata Nano car (iPhone Nano?), founded the national airline (Tata Airways became Air India) but also huge computer consultants and have historically been associated with computers through partnerships like Tata Burroughs (at least India got the best computers).
Getting into these markets requires some radical thinking.
Apple has never pretended to offer a product for everyone. They offer a quality, industry leading product. If you can't afford it, you're free to go elsewhere.
If you look at the results over the past decade, there's nothing wrong with that strategy. Indeed, by attempting to become the leader in terms of volume, Apple would probably have to make so many sacrifices that their long term success would be in jeopardy.
Choose what you're going to do, do it to the best of your ability, and ignore markets that don't interest you.
Lol thats almost word for word a quote from jobs
He said something to the effect that if we can't do something amazing and totally different in a particular area in a market we don't. We only focus on the areas that we can do amazing things and make a difference.
...
There is also a platform to consider.
I'm sure that Tim dwells on this daily!
This explains why most of us know very few people with Android phones and lots of people with iPhones. We don't live in countries where people are poor and phones aren't subsidized.
I doubt Apple is particularly concerned. This explains a lot more about the nature of Android market share than a problem for Apple.
Actually, it seems apple people hang around apple people thus you "see" most people with apple products. I have no such proclivity. Just going to any event, venue or location and truly looking around and you will see that most people are using android phones. This matches up with the market share reports from all the various reporting companies that android has the majority marketshare in every country worldwide. Thus, "most" of us know very few people with iphones and lots of people with android. And just to clarify, I have a macbook pro (running windows and OSX dual booted) so I am not against apple but just find their phones inferior in every way to android from hardware (fact) to OS (opinion).
I just spent two months in India. Buying any Apple products there is hard. Bangalore has an excellent iStore on MG road (near the Barton Centre, which I found was not named after Bob Barton, the original think different designer of the Burroughs B5000).
India has quite a different paradigm at the opposite end of Apple Stores. People like going to these little hole-in-the-wall places. It is capitalism and freedom in the extreme, and sometimes unpleasantly so without usual consumer protections. In Madurai there were about 100 stores in one market all selling mobile phones, none selling Apple. Samsung was even advertised showing pictures of iPhone.
Developing countries are big into mobile phones - the land lines tend to be rubbish or non-existent. The rates are very cheap maybe 1rs (2c) per minute. However, try to buy an iPhone and it's over $800!
Major networks include AirTel, AirCel, Vodaphone, Tata Communications. Tata are a huge company producing the Tata Nano car (iPhone Nano?), founded the national airline (Tata Airways became Air India) but also huge computer consultants and have historically been associated with computers through partnerships like Tata Burroughs (at least India got the best computers).
Getting into these markets requires some radical thinking.
My wife is from the philippines and it is the same thing there. No one can afford an iphone there. Wages are on average of $100/month and that is working 12 hours a day, 6 days a week. Going to Manila to the 2nd largest mall in the world, Mall of Asia, and after walking around all day, i never saw one iphone in a store or in use anywhere. Most people still use non smart phone's and those that can afford a smart phone, have android phone's. I can attest that in the philippines, people are crazy for android. I took my Droid 3 with us and got stopped all the time to show people and got "oohs and aahs". My wife's family thought me a rock star with my fancy phone. No one I talked to and I mean "NO ONE" thought the iphone a cool phone there. They just thought it an overpriced phone for silly american's.
Bravo!!
But this feels like Windows all over again. The general population is happy with "good enough". As technology improves, the difference between Apple's offering and the competition will become narrower and narrower (feature-wise). At the end of the day, the user experience will continue to be the reason to choose Apple.
Hardware and feature wise, android already surpassed iOS. The "user experience" arguement is purely subjective. I find the iphone OS to be difficult to maneuver and not at all logical. However, android just makes sense to me. But then again, Linux makes even more sense than any other OS out there including Android so that's not saying much. My mom's neighbor wanted to get a new phone and heard about "all these smart phone' and asked if I could take her to get one. I took her to verizon and let her look around. The sales guy tried to get her on an iphone, i laughed as she could not figure it out at all (she's 67). The sales guy kept telling her how it was superior, great user experience, easy to use, etc. but she just told him "it ain't easy to me". She then looked at some samsung phone running android and asked why it cost's so much less if it does the same thing as the other phone? The guy had no answer for this old lady. She picked it up, he had to show her how to use it and explain it but she just "got it". She ended up picking an android smart phone of her own volition. She liked the larger screen and text, found the iphone confusing and too small to use with her jittery fingers. She shares things all the time with my mom on Google+ and gmail and just loves it. In the end, the user experience is found to be equal if not better on android consistently which contributes to the 49% marketshare world wide. Sure cost is a factor, but I have more money than you can imagine and I still would not spend $800 for a phone no matter what it is (even android!). Especially when one can be had for much less that does much more and faster.