That works for the US but despite your belief the US is not the center of the world. Apple needs to get more competitive in markets like Europe, India and China where a big majority of people buy their phones off-contract for the full price.
Apple is clearly signaling that they don't give a crap about the low end smartphone market or low end customers. That low end market is already filled to the brim with countless companies, releasing one crappy phone after another, undercutting each other on price, with many of those companies struggling and Apple certainly doesn't need to wallow around in the mud with those other companies.
Apple is going to be selling tens of millions of phones at their current prices. The people buying these phones obviously don't have any problems with the price.
People buy iPhones because they like the phone and all that comes with it (the Apple ecosystem, superior support etc.). That's quite different than many other customers who choose their non Apple phones primarily because they were cheaply priced. Those people who want an iPhone badly enough will get one. Those who can't afford one will just have to choose something else or get a better job or something. That's life. As the Rolling Stones once sang "You can't always get what you want".
Who says? Just because they've done that in the past? The BOM for the 5 may have cost too much to do that.
Nevertheless, the price did drop $100 for a phone that's still high-end and was selling very well.
What you're saying is that by going to plastic Apple should somehow be able to drop it $200 while not destroying margins. Right.
Surely Apple would've sold the 5 and 5s for the same price. /s
They do need to differentiate their products, you know.
Just compare the 5c and 5s. Do you think all the upgrades in the 5s (new 64-bit processor, M7 coprocessor, better GPU, fingerprint reader, better camera, amongst others AND a higher-quality housing) are worth just $100 more? Hell, the 32GB 5c and the 16GB 5s are selling for the *same* price. That does not make sense. At all.
With the introduction of the 5S, the 5 would've been priced at $550 regardless.
Who says? Just because they've done that in the past? The BOM for the 5 may have cost too much to do that.
Nevertheless, the price did drop $100 for a phone that's still high-end and was selling very well.
What you're saying is that by going to plastic Apple should somehow be able to drop it $200 while not destroying margins. Right.
$200 for a few oz of aluminum enclosure. Cool. Look are price of ipod touch. Switch to plastic enclosure and save $200 too! Do you believe it?
The whole plastic enclosure thing is a win win for Apple from a marketing point of view first and foremost and saves a few bucks on the bom. I'm thinking $10-20 max. They are selling a new product line now instead of old model from the same line. This puts distance between new "fun" model and the more serious new premium model. Like MacBook Air vs MacBook Pro. The question is no longer is the 5c good enough the question is the 5s worth $100 more for what you want in a phone. If we still has 5 vs 5s we would not have this same level of separation. I am sure the "c" line will start to go in a different direction and offer things the "s" line does not more than color soon.
I meant that it is a good thing we cannot pre-order the 5s as I'm sure Apple made enough to sell at retail or through websites, including their own. They don't need a pre-order system to see how many people want it, is all.
No one said the site went down. The Store went down to update it with the 5c.
1. You can pre-order the 5s from Walmart and others at a discount.
2. Security conscious agencies and governments probably have huge orders on the 5s. Apple does not spend $ 356 Million on a security company unless a lot of people are asking for them.
3. It's also better for Apple to ship in bulk to partners than to individuals.
4. I think the list pricing is designed to discourage scalping and favor partners and carriers that are paying subsidies to Apple.
Some customers did not get the memo and thought they could pre-order the 5s overnight.
Apple is clearly signaling that they don't give a crap about the low end smartphone market or low end customers. That low end market is already filled to the brim with countless companies, releasing one crappy phone after another, undercutting each other on price, with many of those companies struggling and Apple certainly doesn't need to wallow around in the mud with those other companies.
Again, no one is expecting Apple to make smartphones for the low-end market. The pricing on the 5c is just off. There'd be enough room in the higher mid-end market for Apple to make an impact against the similarly priced "high-end" Android phones.
I know most people in the US buy their phones on contract with family plans and whatnot but consumers in Europe, India or China are more price-sensitive. Just compare the ones here in Germany:
8 GB 4S: 399€
16 GB 5c: 599€
16 GB 5s: 699€
16 GB Galaxy S3: 289€
16 GB Galaxy S4: 489€
8 GB Galaxy S4 mini: 299€
32 GB HTC One: 504,90€
16 GB HTC one mini: 395€
There's just a huge discrepancy between Apple and Android phones. I'm happy to pay the premium for an Apple smartphone but I can't recommend any one of them to people who are not heavy smartphone users like I am. Yes, the 4S is still around for 400€ but it's two years old now, sports a 3.5inch display and the old dock connector. It's just not competitive on price, especially for people who haven't yet experienced an iOS smartphone and don't know why an iPhone is/might be worth the premium for them.
What Apple needs to do is maximize profits and sell every unit they can make as fast as they can make them. Right?
There will always be cheaper phones. So what?
You can't ignore market share and be afraid of <span style="line-height:1.4em;">cannibalisation forever. Even Windows Phone catches up with iOS in countries like Germany, or it already has surpassed it in Italy or Greece. </span>
<span style="line-height:1.4em;">Nobody expects them to sell an iPhone for $50 off-contract but like I said, if you put the iP5 internals into a "cheaper" plastic housing then lower the damn price by at least $100. At this price it's not competitive in Europe, let alone in India or China.</span>
How about this:
The real news here is that T-Mobile’s new Uncarrier plans mean that the iPhone 5c will sell for $0 down with the $528 price tag paid through 24 monthly installments of $22.
That's nice and all. In Germany, the reality is a little different on T-Mobile (biggest carrier here).
1€ upfront, 70€ per month for 24 months.
For a similiar monthly fee of $22, T-Mobile asks for a down payment of 479€. And that'll only give you 50 minutes for calls, 50 SMSs and 100MB for data.
I don't know how the situation is in other European countries (or India and China for that matter) but the high percentage of people buying their phones off-contract in those regions suggests similarly expensive and ridiculous contracts there.
Apple is clearly signaling that they don't give a crap about the low end smartphone market or low end customers. That low end market is already filled to the brim with countless companies, releasing one crappy phone after another, undercutting each other on price, with many of those companies struggling and Apple certainly doesn't need to wallow around in the mud with those other companies.<span style="line-height:1.4em;"> </span>
Again, no one is expecting Apple to make smartphones for the low-end market. The pricing on the 5c is just off. There'd be enough room in the higher mid-end market for Apple to make an impact against the similarly priced "high-end" Android phones.
I know most people in the US buy their phones on contract with family plans and whatnot but consumers in Europe, India or China are more price-sensitive. Just compare the ones here in Germany:
There's just a huge discrepancy between Apple and Android phones. I'm happy to pay the premium for an Apple smartphone but I can't recommend any one of them to people who are not heavy smartphone users like I am. Yes, the 4S is still around for 400€ but it's two years old now, sports a 3.5inch display and the old dock connector. It's just not competitive on price, especially for people who haven't yet experienced an iOS smartphone and don't know why an iPhone is/might be worth the premium for them.
You forgot to mention that Nexus 4 is 350 euros.
Something is very strange in Germany specifically compared to other counties in the EU from Apple vs Andriod market share point if view. I am sure there is a special story there beyond just price. I notice Samsung like to do big press events there. Something related to the iPhone and iPad ban in Germany from a few years ago? And now iCloud.
That's nice and all. In Germany, the reality is a little different on T-Mobile (biggest carrier here).
1€ upfront, 70€ per month for 24 months.
For a similiar monthly fee of $22, T-Mobile asks for a down payment of 479€. And that'll only give you 50 minutes for calls, 50 SMSs and 100MB for data.
I don't know how the situation is in other European countries (or India and China for that matter) but the high percentage of people buying their phones off-contract in those regions suggests similarly expensive and ridiculous contracts there.
I have no experience with the smart phone marketplace on Germany.
I'd ask:
Is Apple attaining their longer-term (say, annual) iPhone sales objectives?
If not, is price the reason?
If so, do you think that Apple is too inflexible or out-of-touch to adjust to market conditions?
15 minutes in, you can still preorder the 5C with an est. delivery of 9/20. Doesn't seem to sell well.
during iPhone 5's time, it was Apple controlling the supply to have the impression the phone is selling out fast... now on 5c, because it is still available after 15mins, it will not sell well???
That's nice and all. In Germany, the reality is a little different on T-Mobile (biggest carrier here).
1€ upfront, 70€ per month for 24 months.
For a similiar monthly fee of $22, T-Mobile asks for a down payment of 479€. And that'll only give you 50 minutes for calls, 50 SMSs and 100MB for data.
I don't know how the situation is in other European countries (or India and China for that matter) but the high percentage of people buying their phones off-contract in those regions suggests similarly expensive and ridiculous contracts there.
Apples and oranges... The info I posted was for buying the iPhone 5C financed over time -- phone service is priced separately.
I have no experience with the smart phone marketplace on Germany.
I'd ask:
Is Apple attaining their longer-term (say, annual) iPhone sales objectives?
If not, is price the reason?
If so, do you think that Apple is too inflexible or out-of-touch to adjust to market conditions?
I reckon it's a very region-specific topic but I would be surprised if the situation is much different in other European countries.
As for your questions:
I don't know what their sales objectives are here but they've lost 2.1 percent market share between July 2012 and 2013 while Windows Phone and Android added 2.6 and 3.4 percent respectively. To be fair, iOS did really well in other European countries (according to Katar World Panel). That's mainly due to the demise of BlackBerry and partly Symbian though, they are not stealing market share from Android or Windows Phone.
I'd say so.
Yes, the prices are out of touch. They worked two, three years ago when the competition was struggling to copy the iPhone but they've gotten stronger, both in terms of quality and price.
Quote:
Originally Posted by snova
You forgot to mention that Nexus 4 is 350 euros.
Something is very strange in Germany specifically compared to other counties in the EU from Apple vs Andriod market share point if view. I am sure there is a special story there beyond just price. I notice Samsung like to do big press events there. Something related to the iPhone and iPad ban in Germany from a few years ago? And now iCloud.
Politics or corruption perhaps?
Yeah, the Nexus 4 was actually on sale a few weeks ago for 299€.
There's nothing suspicious going on as far as I can tell. Samsung is historically a well-respected brand here and ultimately, they win on value. People go to the store, see an iPhone and a Galaxy side-by-side and pick the one with the bigger screen and the quad core processor for a significantly lower price.
If you don't know why the iPhone is more expensive, you can be easily fooled by the - on paper - better specs of an Android device. Even then it begs the question if an iPhone really is worth the premium. I could buy the 16 GB S4, add a 32 GB microSD for my music and end up slightly above the 500€ mark while Apple wants 800€ for the 32 GB iPhone 5s (5c: 700€). It's hard to justify that difference, honestly.
If you don't know why the iPhone is more expensive, you can be easily fooled by the - on paper - better specs of an Android device. Even then it begs the question if an iPhone really is worth the premium. I could buy the 16 GB S4, add a 32 GB microSD for my music and end up slightly above the 500€ mark while Apple wants 800€ for the 32 GB iPhone 5s (5c: 700€). It's hard to justify that difference, honestly.
Of course you'd be stuck with Android, and that cannot be something you were wishing for.
The iPhone itself became only cheaper: the kept (more or less) the same price globally, but added so many HW components and software innovations I don't know where to start explaining it all. Fortunately, I don't have to. Check ww.Apple.com and read it all for yourself.
I just went on Apple's site and can order any model with a 9/20 ship date. Not sure if that means anything. My guess is the people this is geared to don't feel the need to get up at midnight to order it. Initially I was thinking we'd know on Monday how this presale went, but the more I think about it the more I think Apple will never reveal the sales split between 5S and 5C. We'll get combined figures the Monday after the 20th.
One thing I do wonder from a branding position, if people are constantly given the impression by the media that this is "just a year old phone dressed up in a cheap plastic case and marketd as something new" they might think twice about it. Never mind that it's a really good phone and appears to be very well built. The media isn't treating it as a "new phone" but "last years model in a plastic case". Of course it's way to early to tell but if Apple had replaced the 4S with this phone (in terms of slot, not necessarily specs) and still sold iPhone 5 (replacing slate with gray) for slightly cheaper it might have been better from a positioning standpoint.
That's nice and all. In Germany, the reality is a little different on T-Mobile (biggest carrier here).
1€ upfront, 70€ per month for 24 months.
For a similiar monthly fee of $22, T-Mobile asks for a down payment of 479€. And that'll only give you 50 minutes for calls, 50 SMSs and 100MB for data.
I don't know how the situation is in other European countries (or India and China for that matter) but the high percentage of people buying their phones off-contract in those regions suggests similarly expensive and ridiculous contracts there.
I guess the difference is these companies make a less quality product that they can sell cheaper there and then sacrifice profit for market share, look how that worked out for Nokia. These same companies sell their phones here for more than the iPhone off contract so they are trying to make up the difference here.
I'd love to know who was responsible for the branding/positioning of this phone? Schiller? Cook? As I said on a MR thread, Apple should have shaken things up this year. They should have gone with two models: iPhone and iPhone color. iPhone would be the premium device with premium specs, features and design. iPhone color would be the colorful cheaper sibling. The 4/4S would cease to exist and the would be no mention of iPhone 5 anywhere. This would do several things: one, It would get rid of the numbers in the naming conventions (like the iPad has done); two, keep the colored phone from being branded by the media as last years phone in a plastic case and three, not have people thinking the $100 cheaper iPhone 5 is being replaced with colored plastic.
The idea of the 5C is great. The 5C is a great phone. It's just from a branding/positioning standpoint it's not really working, especially with Apple keeping the 4S around and when announcing the 5C constantly referring to how it's just like the 5 (except it doesn't have the 5's premium design). By positioning the 5C in what would have been the 5's slot you've got some people thinking 'I could have gotten a 5, with its premium design for $100 cheaper, instead Apple is throwing colored plastic at me'. It very well may be the 5 is still very expensive to manufacture and reducing it $100 was out of the question. Going iPhone and iPhone color would have alleviated that problem.
A bit strange -- or perhaps not -- that there aren't dozens of frustrated, hands-up-in-the-air "OMG, tried to order at 3AM, but couldn't" posts that have typically followed every iPhone intro since the 3G.
A bit strange -- or perhaps not -- that there aren't dozens of frustrated, hands-up-in-the-air "OMG, tried to order at 3AM, but couldn't" posts that have typically followed every iPhone intro since the 3G.
Why? It's not the new phone. Did we see those kinds of posts last year for the 4S? No.
Comments
That works for the US but despite your belief the US is not the center of the world. Apple needs to get more competitive in markets like Europe, India and China where a big majority of people buy their phones off-contract for the full price.
Apple is clearly signaling that they don't give a crap about the low end smartphone market or low end customers. That low end market is already filled to the brim with countless companies, releasing one crappy phone after another, undercutting each other on price, with many of those companies struggling and Apple certainly doesn't need to wallow around in the mud with those other companies.
Apple is going to be selling tens of millions of phones at their current prices. The people buying these phones obviously don't have any problems with the price.
People buy iPhones because they like the phone and all that comes with it (the Apple ecosystem, superior support etc.). That's quite different than many other customers who choose their non Apple phones primarily because they were cheaply priced. Those people who want an iPhone badly enough will get one. Those who can't afford one will just have to choose something else or get a better job or something. That's life. As the Rolling Stones once sang "You can't always get what you want".
Who says? Just because they've done that in the past? The BOM for the 5 may have cost too much to do that.
Nevertheless, the price did drop $100 for a phone that's still high-end and was selling very well.
What you're saying is that by going to plastic Apple should somehow be able to drop it $200 while not destroying margins. Right.
Surely Apple would've sold the 5 and 5s for the same price. /s
They do need to differentiate their products, you know.
Just compare the 5c and 5s. Do you think all the upgrades in the 5s (new 64-bit processor, M7 coprocessor, better GPU, fingerprint reader, better camera, amongst others AND a higher-quality housing) are worth just $100 more? Hell, the 32GB 5c and the 16GB 5s are selling for the *same* price. That does not make sense. At all.
$200 for a few oz of aluminum enclosure. Cool. Look are price of ipod touch. Switch to plastic enclosure and save $200 too! Do you believe it?
The whole plastic enclosure thing is a win win for Apple from a marketing point of view first and foremost and saves a few bucks on the bom. I'm thinking $10-20 max. They are selling a new product line now instead of old model from the same line. This puts distance between new "fun" model and the more serious new premium model. Like MacBook Air vs MacBook Pro. The question is no longer is the 5c good enough the question is the 5s worth $100 more for what you want in a phone. If we still has 5 vs 5s we would not have this same level of separation. I am sure the "c" line will start to go in a different direction and offer things the "s" line does not more than color soon.
I meant that it is a good thing we cannot pre-order the 5s as I'm sure Apple made enough to sell at retail or through websites, including their own. They don't need a pre-order system to see how many people want it, is all.
No one said the site went down. The Store went down to update it with the 5c.
1. You can pre-order the 5s from Walmart and others at a discount.
2. Security conscious agencies and governments probably have huge orders on the 5s. Apple does not spend $ 356 Million on a security company unless a lot of people are asking for them.
3. It's also better for Apple to ship in bulk to partners than to individuals.
4. I think the list pricing is designed to discourage scalping and favor partners and carriers that are paying subsidies to Apple.
Some customers did not get the memo and thought they could pre-order the 5s overnight.
http://www.gottabemobile.com/2013/09/12/iphone-5s-pre-orders-keep-consumers-awake-cranky/
Apple is clearly signaling that they don't give a crap about the low end smartphone market or low end customers. That low end market is already filled to the brim with countless companies, releasing one crappy phone after another, undercutting each other on price, with many of those companies struggling and Apple certainly doesn't need to wallow around in the mud with those other companies.
Again, no one is expecting Apple to make smartphones for the low-end market. The pricing on the 5c is just off. There'd be enough room in the higher mid-end market for Apple to make an impact against the similarly priced "high-end" Android phones.
I know most people in the US buy their phones on contract with family plans and whatnot but consumers in Europe, India or China are more price-sensitive. Just compare the ones here in Germany:
8 GB 4S: 399€
16 GB 5c: 599€
16 GB 5s: 699€
16 GB Galaxy S3: 289€
16 GB Galaxy S4: 489€
8 GB Galaxy S4 mini: 299€
32 GB HTC One: 504,90€
16 GB HTC one mini: 395€
There's just a huge discrepancy between Apple and Android phones. I'm happy to pay the premium for an Apple smartphone but I can't recommend any one of them to people who are not heavy smartphone users like I am. Yes, the 4S is still around for 400€ but it's two years old now, sports a 3.5inch display and the old dock connector. It's just not competitive on price, especially for people who haven't yet experienced an iOS smartphone and don't know why an iPhone is/might be worth the premium for them.
How about this:
http://************/2013/09/12/t-mobile-offering-0-down-on-iphone-5c-99-down-on-iphone-5s-with-monthly-installment-plan/
How about this:
http://************/2013/09/12/t-mobile-offering-0-down-on-iphone-5c-99-down-on-iphone-5s-with-monthly-installment-plan/
That's nice and all. In Germany, the reality is a little different on T-Mobile (biggest carrier here).
1€ upfront, 70€ per month for 24 months.
For a similiar monthly fee of $22, T-Mobile asks for a down payment of 479€. And that'll only give you 50 minutes for calls, 50 SMSs and 100MB for data.
I don't know how the situation is in other European countries (or India and China for that matter) but the high percentage of people buying their phones off-contract in those regions suggests similarly expensive and ridiculous contracts there.
Something is very strange in Germany specifically compared to other counties in the EU from Apple vs Andriod market share point if view. I am sure there is a special story there beyond just price. I notice Samsung like to do big press events there. Something related to the iPhone and iPad ban in Germany from a few years ago? And now iCloud.
Politics or corruption perhaps?
I have no experience with the smart phone marketplace on Germany.
I'd ask:
during iPhone 5's time, it was Apple controlling the supply to have the impression the phone is selling out fast... now on 5c, because it is still available after 15mins, it will not sell well???
Apples and oranges... The info I posted was for buying the iPhone 5C financed over time -- phone service is priced separately.
I have no experience with the smart phone marketplace on Germany.
I'd ask:
I reckon it's a very region-specific topic but I would be surprised if the situation is much different in other European countries.
As for your questions:
You forgot to mention that Nexus 4 is 350 euros.
Something is very strange in Germany specifically compared to other counties in the EU from Apple vs Andriod market share point if view. I am sure there is a special story there beyond just price. I notice Samsung like to do big press events there. Something related to the iPhone and iPad ban in Germany from a few years ago? And now iCloud.
Politics or corruption perhaps?
Yeah, the Nexus 4 was actually on sale a few weeks ago for 299€.
There's nothing suspicious going on as far as I can tell. Samsung is historically a well-respected brand here and ultimately, they win on value. People go to the store, see an iPhone and a Galaxy side-by-side and pick the one with the bigger screen and the quad core processor for a significantly lower price.
If you don't know why the iPhone is more expensive, you can be easily fooled by the - on paper - better specs of an Android device. Even then it begs the question if an iPhone really is worth the premium. I could buy the 16 GB S4, add a 32 GB microSD for my music and end up slightly above the 500€ mark while Apple wants 800€ for the 32 GB iPhone 5s (5c: 700€). It's hard to justify that difference, honestly.
Of course you'd be stuck with Android, and that cannot be something you were wishing for.
The iPhone itself became only cheaper: the kept (more or less) the same price globally, but added so many HW components and software innovations I don't know where to start explaining it all. Fortunately, I don't have to. Check ww.Apple.com and read it all for yourself.
One thing I do wonder from a branding position, if people are constantly given the impression by the media that this is "just a year old phone dressed up in a cheap plastic case and marketd as something new" they might think twice about it. Never mind that it's a really good phone and appears to be very well built. The media isn't treating it as a "new phone" but "last years model in a plastic case". Of course it's way to early to tell but if Apple had replaced the 4S with this phone (in terms of slot, not necessarily specs) and still sold iPhone 5 (replacing slate with gray) for slightly cheaper it might have been better from a positioning standpoint.
People are already buying the 5. The 5c is the new 5 with style. Of course they will continue to buy it.
It will be the biggest launch ever for Apple.
This is kind of self evident. But for all those WSJ nose pickers it will take 6 more months to realize. Oh well....
The idea of the 5C is great. The 5C is a great phone. It's just from a branding/positioning standpoint it's not really working, especially with Apple keeping the 4S around and when announcing the 5C constantly referring to how it's just like the 5 (except it doesn't have the 5's premium design). By positioning the 5C in what would have been the 5's slot you've got some people thinking 'I could have gotten a 5, with its premium design for $100 cheaper, instead Apple is throwing colored plastic at me'. It very well may be the 5 is still very expensive to manufacture and reducing it $100 was out of the question. Going iPhone and iPhone color would have alleviated that problem.