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$50 sale leaves Radio Shack with nationwide shortage of Apple's iPhone

post #1 of 43
Thread Starter 
Just days after Radio Shack began a promotion offering $50 off the iPhone, and before the sale was set to expire, many of the U.S. retail chain's stores are sold out of their entire stock of phones.

AppleInsider contacted a number of Radio Shack stores on Friday, and all but one, spoken to in Tennessee, indicated they are completely sold out of the iPhone 4. And even that one store only has the 32GB model available in limited quantities.

Another store in North Carolina indicated that the "entire region" of stores was completely out of stock of the iPhone 4. Another store indicated that customers can still buy the handset online and obtain the $50 rebate, and the phone ships in an estimated two days.

AppleInsider made the calls after it received word that the company had essentially run out of iPhones on a company-wide basis. A request for information from Radio Shack's corporate public relations department was not returned.

Radio Shack has seen tremendous demand since it launched a promotion on Sunday slashing $50 off the price of all iPhone models with a two-year AT&T contract. The retail chain is also offering a 16GB iPhone 4 for just $25 with the trade-in of an iPhone 3GS.

The promotion is set to run through Saturday, Dec. 11, but those who waited on the deal may be forced to order their iPhone online, as most Radio Shack stores are completely out of stock. As a major retailer with more than 4,600 storefronts worldwide, Radio Shack is a significant partner of Apple and iPhone seller.

Also Friday, another retailer, Best Buy, ran a major promotion with Apple's handset, offering a free iPhone 3GS to customers who agreed to a new two-year contract. The 8GB iPhone 3Gs regularly sells for $99 with a contract.
post #2 of 43
There is probably a moral to this story

Update: (I mean iPhones perhaps don't need discounting)
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post #3 of 43
Didn't see that coming.
post #4 of 43
The headline... isn't that a $50 discount instead of sale?
post #5 of 43
Quote:
Originally Posted by digitalclips View Post

There is probably a moral to this story



Apple might make even more money if they use BOGO or free or almost-free pricing strategies?

Dunno. They have to consider perceptions if they are aiming for long-term outsized margins. If the iPhone is seen as a heavily discounted item, it might reduce profits long-term.
post #6 of 43
Quote:
Originally Posted by AppleInsider View Post

Just days after Radio Shack began a promotion offering $50 off the iPhone, and before the sale was set to expire, many of the U.S. retail chain's stores are sold out of their entire stock of phones....


What gives? Iphones sell extremely well without promotions. Why all the discounts? Because its going to Verizon next year baby!!! Theyre emptying their inventory, letting ATT get as many customers as they can in preparation for Verizon. Its the only strategy I see anyway.
post #7 of 43
With monthly bills averaging $80/mo for service, I just don't understand how a $50 discount on the phone itself is the thing that suddenly makes it affordable for some people. Hard to imagine they're thinking it through.
post #8 of 43
Quote:
Originally Posted by enohpI View Post


Dunno. They have to consider perceptions if they are aiming for long-term outsized margins. If the iPhone is seen as a heavily discounted item, it might reduce profits long-term.

Sorry I now see my post was ambiguous. My meaning was the other way around than the way I think you took it. I meant there is no need to discount iPhones.
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post #9 of 43
Quote:
Originally Posted by Cory Bauer View Post

With monthly bills averaging $80/mo for service, I just don't understand how a $50 discount on the phone itself is the thing that suddenly makes it affordable for some people. Hard to imagine they're thinking it through.

I think you completely miss the fact that this was an amazing walk-in upgrade opportunity for 3G/3GS users who got the new iPhone for as little as $25.

I'm sure the overwhelming majority of sales that contributed to this sell out were trade-in/upgrades.

Regardless, anyone who was looking to purchase an iPhone 4 this week would have been foolish to go Apple or AT&T instead with a 25% discount running. Not that hard to figure out.

People without expensive smartphones didn't just leap out the door at the discovery of this sale.
post #10 of 43
Quote:
Originally Posted by quinney View Post

Didn't see that coming.

RADIO shack had 5 in stock per store anyway /

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post #11 of 43
Quote:
Originally Posted by digitalclips View Post

There is probably a moral to this story

Update: (I mean iPhones perhaps don't need discounting)

Wouldn't the moral of the story be that if you want to sell a lot of product, lower the price? And didn't they succeed? Surely you don't think they didnt want to see all that product, right?
post #12 of 43
Do they still pay taxes on it like if it was $600?
post #13 of 43
Went to RadioShack website. No links to buy an iPhone. Called the RadioShack phone sales line. The person there told me that they do not sell iPhones online at all. You have to buy it from a physical store. So I'm not sure what the person in NC was talking about. It appears that there is no way to buy it online and still get the $50 discount.
Any chance Radio Shack will extend this deal?
post #14 of 43
Quote:
Originally Posted by Cory Bauer View Post

With monthly bills averaging $80/mo for service, I just don't understand how a $50 discount on the phone itself is the thing that suddenly makes it affordable for some people. Hard to imagine they're thinking it through.

It's doubtful that a significant number of people suddenly felt that they could afford an iPhone due to the $50 off.

Rather, these were probably people who were planning to buy the iPhone, anyway, and chose Radio Shack to save $50.
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post #15 of 43
It's TJ Maxx with their 80 iPads all over again. A national chain, wanting cheap headlines and publicity, claims to be selling Apple products for a lower price than anywhere else. But they only order a small amount of the product so they minimize their losses. It gets customers in the store or at least plants the reseller's name in customers' minds, even if they aren't able to buy the product. It's deceptive but effective. Coattailing on Apple's success.
post #16 of 43
Quote:
Originally Posted by jragosta View Post

It's doubtful that a significant number of people suddenly felt that they could afford an iPhone due to the $50 off.

Rather, these were probably people who were planning to buy the iPhone, anyway, and chose Radio Shack to save $50.

+1

Yes. It's not a big discount but it steered customers into the "shack" , it did not make Apple any extra money. If I was buying an iPhone that week I would have gone there.
post #17 of 43
iPhone 4 with trade in of my old iPhone 3G: $88 out the door with new 24 month agreement that retains my unlimited data plan. It's a nice 16GB machine. They wanted the wall socket plug, and snagged it out of the new box to send with the trade-in. I have one at home that works fine. But this inlcudes a new USB cable and earbuds set.

I was going to upgrade eventually, and since I was rolling month to month on the old plan anway, I saved $111 plus tax.

Gave some thought to adding a tether plan for my wifi only iPad, but for my use, I just don't need it. I have wifi practically everywhere I travel, and where I don't iPhone4 will fill in for emergencies. YMMV.
post #18 of 43
I was excited by this promotion as a great, inexpensive way to upgrade my wife's iPhone 3G. When I dropped by one of our local Radio Shack stores I was informed that the entire region had sold out in the first several hours of the sale and they weren't going to get any additional inventory until after the sale expired. No rain checks, no apologies, no help. There were three other people who were in the store and another person on the phone all looking for the same deal.

It seems pretty short sighted for Radio Shack not to have anticipated demand and had more stock available if they really wanted to draw people in and become a viable option to sell wireless products. As it stands now, I have even less of a reason to buy anything from them. The staff I encountered were neither friendly, nor very knowledgeable although they did go out of their way to inform me that AppleInsider were liars for suggesting we could get the deal from the online store, even though it was one of their fellow employees who apparently passed on that erroneous information. I suspect Radio Shack may have done more harm to their reputation than good with this poorly planned sale.
post #19 of 43
Quote:
Originally Posted by producerdude View Post

I was excited by this promotion as a great ... No rain checks, no apologies, no help.

Welcome to rule by corporatocracy.
post #20 of 43
Quote:
Originally Posted by jragosta View Post

It's doubtful that a significant number of people suddenly felt that they could afford an iPhone due to the $50 off.

Rather, these were probably people who were planning to buy the iPhone, anyway, and chose Radio Shack to save $50.

I think that a lot of people go to radio Shack looking to get a cheap phone. They saw the iPhone, it fit the bill, and they went home with it. It is interesting that there is as much price elasticity as this sale seems to indicate.
post #21 of 43
Quote:
Another store in North Carolina indicated that the "entire region" of stores was completely out of stock of the iPhone 4.

I'm in Raleigh, NC and when I asked several stores how many phones how many they had BEFORE the promotion started, their answer was "none".

This was an unbelievably poorly managed promotion, even for Radio Shack.
post #22 of 43
Quote:
Originally Posted by enohpI View Post

Apple might make even more money if they use BOGO or free or almost-free pricing strategies?

Dunno. They have to consider perceptions if they are aiming for long-term outsized margins. If the iPhone is seen as a heavily discounted item, it might reduce profits long-term.

Let me guess, your favorite "business strategy" is: "I only lose $3.00 per unit, but I make it up on volume".
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post #23 of 43
Giving Iphones away at a ridiculous price certainly will create a shortage and a dent in Radio Shacks pocket, as be assured that Apple is not taking the hit for selling discounted Iphones.
post #24 of 43
I tried this sale last Sunday. I was looking for 2 32 Gb models. Long story short, there were ZERO in the Hampton Roads, VA area and virtually no 16 Gbs either. Radio Slack never had any stock to sell in the first place. And from what I was told, the sale was NOT available on line. I had the regional sales guy check inventory on both of their local sales districts. None. He couldn't even order one from their "Direct to You" service (buy it in the store, it ships directly to your home...), none in stock. Then he tried to blame the whole thing on Apple not giving them enough inventory...

I wont' bother with the rest of the saga. All this did was further confirm my previous impression that Radio Shack is a low rent useless place to shop for electronics. Except in the most extreme emergency where I need an obscure part that only they sell and I call and confirm that it it is in stock and that they will hold it for me...and hell freezes over...I won't be shopping there again.

Nice job Radio Slack...
post #25 of 43
Quote:
Originally Posted by enohpI View Post

Apple might make even more money if they use BOGO or free or almost-free pricing strategies?

Dunno. They have to consider perceptions if they are aiming for long-term outsized margins. If the iPhone is seen as a heavily discounted item, it might reduce profits long-term.

.. and create monstrous supply and distribution problems and holdups.

One thing's for sure though; a BOGOF iPhone would see daily activations of close to 1 million plus.
post #26 of 43
Quote:
Originally Posted by newbee View Post

Let me guess, your favorite "business strategy" is: "I only lose $3.00 per unit, but I make it up on volume".

No, it is to make less profit per unit, but to sell many, many more units. That works with goods that have sufficient elasticity of demand.

For some of the basics, see http://en.wikipedia.org/wiki/Pricing_strategies

There are many choices. Apple will choose the one which yields the maximum total profit. They are good at doing that.
post #27 of 43
Quote:
Originally Posted by enohpI View Post

No, it is to make less profit per unit, but to sell many, many more units. That works with goods that have sufficient elasticity of demand.

For some of the basics, see http://en.wikipedia.org/wiki/Pricing_strategies

There are many choices. Apple will choose the one which yields the maximum total profit. They are good at doing that.

And clearly the iPhone can come down in price. The iPod Touch 4 which is missing the retina display, and the radio card sells for buttons. Apple are probably aware of this, they are with the iPod. I bet they have three lines at the end of the year - the 3GS which will be sold for free with most plans, the iP4 which will be cheap, and the iP5 which will be the expensive one.
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post #28 of 43
Quote:
Originally Posted by enohpI View Post

No, it is to make less profit per unit, but to sell many, many more units. That works with goods that have sufficient elasticity of demand.

For some of the basics, see http://en.wikipedia.org/wiki/Pricing_strategies

There are many choices. Apple will choose the one which yields the maximum total profit. They are good at doing that.

It seems to me that Apple has already chosen ... the one which yields the maximum total profit. ..... and what they have chosen seems to be working out rather well. For you or I, or anyone else for that matter, to suggest that they rethink their pricing strategy borders on either arrogance or stupidity, imo .... take your choice.
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post #29 of 43
Quote:
Originally Posted by newbee View Post

For you or I, or anyone else for that matter, to suggest that they rethink their pricing strategy borders on either arrogance or stupidity, imo .... take your choice.


For you, or I, or anyone else for that matter, to suggest that Apple is not continuously rethinking each and every strategy, including their pricing strategy, is ... take your choice.

And to deny that variant pricing strategies are now being employed with Apple products is to ignore reality. Lately AI has told us of experiments with free iPads, free iPhones and practically-free iPhones. They have also told us that such strategies have yielded higher volumes. I believe that this data will be noticed by other stakeholders.
post #30 of 43
I SLEPT ON THIS STORY ;LAST NIGHT AND I cans now say that radio shack has almost no great products to sell amy more
their stores always seem to have a oddball stock of useless products
and all those little gew gaws that they use to carry and were so great to find seemed to have left the shelves of RADIO SHACK FOR EVER

Radio Shack is turning into a directionless company selling cellphones aw/ 2 yr plans .

Apple should buy them for their store locations alone .


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post #31 of 43
Quote:
Originally Posted by newbee View Post

It seems to me that Apple has already chosen ... the one which yields the maximum total profit. ..... and what they have chosen seems to be working out rather well. For you or I, or anyone else for that matter, to suggest that they rethink their pricing strategy borders on either arrogance or stupidity, imo .... take your choice.

You have no idea what the maximum possible profit is, they can only test that by having a cheap product and see whether price per unit is made up for by volume. As I suggested the best way to do this is not to dis-continue the 3GS this summer, and I bet they wont.

The second counter argument is to invoke Apple's past once again, and argue against temporary profits when facing stiff competition from other platforms. Since Jobs has himself acknowledged that Apple decided to take short term profits for growth in the 90's and that was a mistake he will probably lower the relative costs of the iPhone over time. In fact they have already done that - in the first 3 months, when - clearly - sales were disappointing.

Better to end up with 30-40% of the market with a handset giving profits of(<) $100, than 5% of the market with a handset giving profits of $300.
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post #32 of 43
Quote:
Originally Posted by enohpI View Post

Lately AI has told us of experiments with free iPads, free iPhones and practically-free iPhones. They have also told us that such strategies have yielded higher volumes.

As I understand it, these "strategies" are typically initiated by retailers other than Apple. Apple themselves, other than Black Friday, Xmas or student discounts seldom, if ever, discount their merchandise ..... why would they? If you know differently, feel free to enlighten me with specifics. This "old dog" is always willing to learn "new tricks".
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post #33 of 43
Quote:
Originally Posted by asdasd View Post

You have no idea what the maximum possible profit is, they can only test that by having a cheap product and see whether price per unit is made up for by volume.

Do you honestly think that Apple would ever in a million years adhere to this so called strategy .... really?
Quote:
Originally Posted by asdasd View Post

.... he will probably lower the relative costs of the iPhone over time. In fact they have already done that - in the first 3 months, when - clearly - sales were disappointing.

"Our sources indicate that iPhone will likely become the fastest selling product in Apple's history and not to mention likely among the fastest (if not the fastest) in consumer electronics," analyst Shaw Wu informed clients in a research report published Monday. "We estimate sales of about 250,000 units in two days (up from our previous view of 50,000). The previous fastest seller was iPod nano, which sold about 1 million units in about 17 days meaning, about 59,000 units per day."

http://www.appleinsider.com/articles...n_history.html

"Apple's (APPL) highly touted iPhone "all but sold out" its initial shipment in both Apple and AT&T (ATT) stores after just three days of sales, the companies said Monday.
Neither Apple nor AT&T disclosed precise sales figures. Tech and telecom analysts estimated sales of 500,000 to 700,000 units of the combination phone, iPod and pocket Internet device by Sunday."
http://www.usatoday.com/tech/wireles...one-tech_N.htm

If these sales are "clearly disappointing" then it is obvious you and I are not even in the same book, let alone the same page. It is more likely that the amazing first weekend sales told Steve that Apple would be able to realize "economies of scale" way ahead of schedule and was therefore able to re-adjust prices to reflect that new info.
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post #34 of 43
Quote:
Originally Posted by newbee View Post

Do you honestly think that Apple would ever in a million years adhere to this so called strategy .... really?


"Our sources indicate that iPhone will likely become the fastest selling product in Apple's history and not to mention likely among the fastest (if not the fastest) in consumer electronics," analyst Shaw Wu informed clients in a research report published Monday. "We estimate sales of about 250,000 units in two days (up from our previous view of 50,000). The previous fastest seller was iPod nano, which sold about 1 million units in about 17 days meaning, about 59,000 units per day."

http://www.appleinsider.com/articles...n_history.html

"Apple's (APPL) highly touted iPhone "all but sold out" its initial shipment in both Apple and AT&T (ATT) stores after just three days of sales, the companies said Monday.
Neither Apple nor AT&T disclosed precise sales figures. Tech and telecom analysts estimated sales of 500,000 to 700,000 units of the combination phone, iPod and pocket Internet device by Sunday."
http://www.usatoday.com/tech/wireles...one-tech_N.htm

If these sales are "clearly disappointing" then it is obvious you and I are not even in the same book, let alone the same page. It is more likely that the amazing first weekend sales told Steve that Apple would be able to realize "economies of scale" way ahead of schedule and was therefore able to re-adjust prices to reflect that new info.

This deserves a re-quote:

Quote:
Do you honestly think that Apple would ever in a million years adhere to this so called strategy .... really?

you mean the "so called strategy" they are using to dominate the music player market?


The fact remains that Apple reduced it's iPhone prices. And as for what it sold - in the first year about 5% of what it sells now.

http://blogs.law.harvard.edu/dlaroch...price-history/

How soon we forget. The original iPhone was in two models: the 4G ist gen at $499, and the 8GB at $599. The latter was reduced to $399 ( a 40% reduction) in about 4 months due to crap follow on sales. The former was discontinued. Without that reduction, the debate here would be as refined as the Newton forum.

The idea that you reduce prices to increase volume is such a fundamental idea in marketing and business that you and I are indeed on the opposite page of the debate.

I want Apple to win in market share, or be the largest seller of mobile Oses. The concern about temporary profitability is what caused Apple to decline in the 90's. Apple was historically one of the largest computer manufacturers in 1995, with about 20% of the consumer PC OS market. From there the only way was down. If the iOS is 20% of the market it is doomed. There is a trade off between temporary profits and long term profits and the viability of a platform. This kind of stuff is remedial.
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post #35 of 43
Quote:
Originally Posted by newbee View Post

as i understand it, these "strategies" are typically initiated by retailers other than apple. Apple themselves, other than black friday, xmas or student discounts seldom, if ever, discount their merchandise ..... Why would they? If you know differently, feel free to enlighten me with specifics. This "old dog" is always willing to learn "new tricks".

the first gen iphone, old dog.

And the reduction in prices which I suggest; where they keep a cheap version of the product, along with the premium versions: the iPod.


You know, the really successful stuff.
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post #36 of 43
Quote:
Originally Posted by asdasd View Post

you mean the "so called strategy" they are using to dominate the music player market?

Yes, the strategy of having products of quality and fair prices, as opposed to your stated strategy of : having a cheap product and see whether price per unit is made up for by volume. Do you see Apple lowering the iPod prices to be level with their competition .... of course not .... why should they.

Quote:
Originally Posted by asdasd View Post

The fact remains that Apple reduced it's iPhone prices.

Again, yes, because of better than expected sales thereby realizing much faster economies of scale, not for this imagined reason by you: reduced to $399 in about 4 months due to crap follow on sales.
According to Apples 4Q - 2007 reports : "Quarterly iPhone sales were 1,119,000, bringing cumulative fiscal 2007 sales to 1,389,000." ..... These kind of numbers were hardly "crap".
Quote:
Originally Posted by asdasd View Post

And as for what it sold - in the first year about 5% of what it sells now.

Of course, ....... seeing as how the iPhone is now sold all over the world and has 4 years of history and advertising behind it, unlike in 2007 ... only being sold in US.
Quote:
Originally Posted by asdasd View Post

The idea that you reduce prices to increase volume is such a fundamental idea in marketing and business that you and I are indeed on the opposite page of the debate.

If all you want is marketshare you can reduce or even, in Googles case, give away your product. That is obvious. What is less obvious, especially to some, is if that is a sound business strategy for Apple. I'm suggesting to you that it is not and judging from Apples quarterly reports they would seem to be of the same opinion.
Quote:
Originally Posted by asdasd View Post

I want Apple to win in market share, or be the largest seller of mobile Oses. The concern about temporary profitability is what caused Apple to decline in the 90's. Apple was historically one of the largest computer manufacturers in 1995, with about 20% of the consumer PC OS market. From there the only way was down. If the iOS is 20% of the market it is doomed. There is a trade off between temporary profits and long term profits and the viability of a platform. This kind of stuff is remedial.

This whole paragraph is such bullshit I don't know where to start. First off, in 1995 Apple started to "chase marketshare" and temporary profits (as you like to say) by allowing Mac clones. That was not a Steve Jobs decision as he was not there at that time. In 1997, when Steve took over Apple again, one of his first moves was to reverse that decision and get rid of the clones. So it would seem that SJ does not share your "enlightened" views on how to run a business ... To quote DaHarder .... Shocking!
I'm really glad SJ is in charge, not you.
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post #37 of 43
Quote:
Originally Posted by newbee View Post

Yes, the strategy of having products of quality and fair prices, as opposed to your stated strategy of : having a cheap product and see whether price per unit is made up for by volume. Do you see Apple lowering the iPod prices to be level with their competition .... of course not .... why should they.

Fair, is your definition of cheap apparently. Do I see Apple lowering iPod prices to be level with their competition. Yes, I do. The iPod nano. The comparative cheapness of the iPod touch compared to the non-subsidized version of the iPhone. I am arguing for a cheap iPhone along with the premium versions. I really am amazed that that simple business stratagem is causing any furor whatsoever.


Quote:
If all you want is marketshare you can reduce or even, in Googles case, give away your product. That is obvious. What is less obvious, especially to some, is if that is a sound business strategy for Apple. I'm suggesting to you that it is not and judging from Apples quarterly reports they would seem to be of the same opinion.

You are mistaking present day quarterly profits with long term strategy. I have already dealt with this. People are bored wit repetition.

Quote:
This whole paragraph is such bullshit I don't know where to start. First off, in 1995 Apple started to "chase marketshare" and temporary profits (as you like to say) by allowing Mac clones. That was not a Steve Jobs decision as he was not there at that time. In 1997, when Steve took over Apple again, one of his first moves was to reverse that decision and get rid of the clones. So it would seem that SJ does not share your "enlightened" views on how to run a business ... To quote DaHarder .... Shocking!
I'm really glad SJ is in charge, not you.

The level of debate continues to deteriorate ( temporary profits from licensing?)

. I didnt say anything about licensing. When Apple licensed it still produced the most expensive PC on the market, so not surprisingly they failed and it was too late anyway. The time to licence and reduce prices was the late 80's and the early 90's before Windows 95. I chose 95 as an example of when it was too late to recover. It still is too late to recover market share in the PC market. And if Apple are too expensive then it will be in the phone market.

The facts of Apple and the Mac are salutary and obvious, you can make big profits on static ( or more likely) declining market share in a market which is increasing. That can still mean more sales, and profits.

But then one day the devs are gone to the majority platform, consumers have followed, the golden goose is cooked and you are beleaguered once again.
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post #38 of 43
Quote:
According to Apples 4Q - 2007 reports : "Quarterly iPhone sales were 1,119,000, bringing cumulative fiscal 2007 sales to 1,389,000." ..... These kind of numbers were hardly "crap".

Of course, ....... seeing as how the iPhone is now sold all over the world and has 4 years of history and advertising behind it, unlike in 2007 ... only being sold in US.

This deserves a seperate answer.

Firstly Apple's 4Q is during the time they reduced the prices ( they reduced in 5th September) and they clearly reduced prices for a reason. Since you seem to be opposed to the ideology of Apple reducing prices,

1) care to explain why they already reduced prices?
2) care to explain why if their sales were good enough - as you seem to imply - they would forgo profits for volume which is clearly what they did?
3) Do you think they shoudl add back the $200 reduction? If not why not?

Faced with the reality that Apple have reduced prices in the iPod line ( with lower priced models) , and in the iPhone line by reducing prices across all lines at the time your apparent argument consists of just throwing a tantrum, repeating that Apple never do reduce prices (and they never will) when they clearly do and have; and directing us to the Quarterly reports. This despite the fact that my argument is not that they are not making profit now ( which they are) , but they may not in future unless they compete on price, which is a simple business argument.

Apple may want to be a niche smart phone maker, and may keep prices high. I don't know . However I don't feel that the modern Apple wants to be a niche player, so they will probably reduce prices, or keep the 3GS as a lower priced model, a la Nano.

i cant say what they will do, but if they dont compete on prices they will be back in their niche position. Some Apple fans like that, but I dont .
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post #39 of 43
As an authorized reseller, Radio Shack needs Apple's permission to offer a sale. Apple probably is trying to clear out inventory and is offering holiday deals. Radio Shack probably ran out of inventory because Apple only allocated a certain amount of units to Radio Shack.


Quote:
Originally Posted by BUSHMAN4 View Post

Giving Iphones away at a ridiculous price certainly will create a shortage and a dent in Radio Shacks pocket, as be assured that Apple is not taking the hit for selling discounted Iphones.
post #40 of 43
Apple is doing what it always does.

It engages in similar behavior at certain times of the year. For example, back to school time. It offers a free iPod with a Mac purchase to help it clear out old inventory for the new product launch that happens usually in September.

Apple further offers various reduced pricing on it's lower end products around the holidays. Apple knows that is when people are spending money for others. Any slight reduction in margins it might sacrifice is made up by volume sales. Apple then usually refreshes product in January because it knows that is when people will be using holiday money to buy for themselves. People buying for themselves tend to spend more then when they are buying for others. You will see a reduction in these types of offers after the holiday.

What is unusual this year is Apple aggressively offering deals to retail partners on the 3GS. Normally, you see more iPad related deals. I suspect Apple may be offering deals to retail partners to clear inventory for a possible launch of a Verizon phone in early 2011.
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