If true, that is simply scandalous - in fact, I am not aware of ANY Apple device comprising such a criminal profit margin - not even the IIfx or the 20th Anniversary Mac did that. So no; I still cannot believe the gold one contains only 1k worth of gold.
The profit margin on the Steel version could possibly be even higher at $1000. The material cost for the case and strap is likely negligible.
If true, that is simply scandalous - in fact, I am not aware of ANY Apple device comprising such a criminal profit margin - not even the IIfx or the 20th Anniversary Mac did that. So no; I still cannot believe the gold one contains only 1k worth of gold.
The profit margin on the Steel version could possibly be even higher at $1000. The material cost for the case and strap is likely negligible.
The steel version strikes me as an absolute rip-off; it makes me sad.
I regard a steel strap as inferior to a leather one. Apple are charging £129 for the leather in the UK and £379 for the steel strap. Utterly ridiculous. Apple should be deeply ashamed of themselves.
in this case we see a device being launched without any stated limited production numbers nor clear gold weight values. So it's hard to jump into that flawed logic without even knowing how "unique" the gold edition will be.
The trouble is they have no market experience here yet. They did this with the iPhone starting at $599 subsidized and then dropped the price to $399 once they got a feel for the demand:
It's hard to come out and say they are only making say 10,000 edition units and then discover they could sustain those prices for 50,000 units. At the same time, without saying how many they're making, it's hard for buyers to assess the exclusivity they are investing in.
They should probably commit to a reasonable figure and then the next model would be a different design. This is probably why they're having a preorder:
That will give them a rough indicator of how many they'd sell at launch and which type of gold. Then they'd be able to say something like 20,000 of rose gold and 30,000 of yellow gold.
If they aren't going to change the design much between revisions, I'm not sure how this exclusivity is going to work. Traditional watch designs change quite noticeably.
In the end, it all comes down to perception. In the first instance, will Apple's margins be similar to those of similar gold jewellery? In the second, would those margins be justified considering the ephemeral nature of the Apple Watch? As others have said, this is the first time anyone has tried to sell a short-lived gadget as a piece of jewellery, notwithstanding bling customisations.
My feeling is that it is a terrible mistake, but who knows; maybe it'll be a huge success.
If they aren't going to change the design much between revisions, I'm not sure how this exclusivity is going to work. Traditional watch designs change quite noticeably.
Because of the stacked design I think the casing and change dramatically YoY without the internal footprint changing much, or at all.
In the end, it all comes down to perception. In the first instance, will Apple's margins be similar to those of similar gold jewellery? In the second, would those margins be justified considering the ephemeral nature of the Apple Watch? As others have said, this is the first time anyone has tried to sell a short-lived gadget as a piece of jewellery, notwithstanding bling customisations.
My feeling is that it is a terrible mistake, but who knows; maybe it'll be a huge success.
I would be very surprised if the Edition is a hit in Asia. The perception will likely be that there is less actual gold, given the size, than would normally be expected of an 18K gold watch like a Rolex, etc. As you say, it may all come down to perception.
I regard a steel strap as inferior to a leather one. Apple are charging £129 for the leather in the UK and £379 for the steel strap. Utterly ridiculous.
The steel band looks nice and symmetric but a bit over-engineered. It looks like each link has a button on it to remove the link. That's great for easily customizing the strap length without tools but you do this once.
There is no known functional difference in the models. There is actually no upsell unlike in Apple's computer product lines.
Functionally they are the same but I'd say there's a clear aesthetic improvement as you go up the models. Look at the feminine styles:
$350
$750
$17,000
With the iPhone, gold, silver and space grey are in the same price bracket and the Mac model price variation is nothing like 22x, the Macbook is $899, the top MBP is $3500 so under 4x. iPhones are $100 apart and similar with iPads.
Because of the stacked design I think the casing and change dramatically YoY without the internal footprint changing much, or at all.
The crown limits how thin they can go, maximum would less than 20% thinner roughly and the insides must be packed to get enough battery life. Battery advances are slow.
The crown limits how thin they can go, maximum would less than 20% thinner roughly and the insides must be packed to get enough battery life. Battery advances are slow.
It's the same story on the components of mechanical watches and lines — except with smartwatches we have an entire SIP commonly measured in nanometers — and the styling of the cases vary wildly. This is why I wouldn't be surprised to see Apple have standardized the internal sizes so that they can have massive YoY casing and strap changes, with some new internals being able to fit inside older casings.
Why do you say these are feminine styles? I've seen tan watch bands on a man's watch before. And I see guys in the gym with neon pink workout gear. I'm not saying these particular styles don't appeal more toward women, but they're fairly gender neutral.
Even people that have $10K to $17K (plus tax) to spend on a watch will NOT buy a watch with a battery that cannot last one day. Face reality, it is not that hard to figure out. Apple only allowing 30 minute viewing time for a $10K product is ridiculous. Apple should allow as much time as they want if they are a serious buyer. But then Apple is not going to sell many gold versions anyway, so they will have plenty of open appointments. It is strange that Apple is releasing so many different variations when they have not even tested the market to see if people want it. The smart watch market is not successful. That has been proven. Even the activity bands are not that popular. You don't see the masses wearing fit-bits. Apple failed miserably with the Performa line of Macs because they had too many models to choose from, and it got too confusing. Is Apple going to stock every single variation so people could sample the bands and the feel of the watch? Probably not.
The amount of gold in the watch is not worth $10K. It is not that much gold. Apple has always been known for ridiculous markups, especially on an item like this. Remember the 20th Anniversary Mac? $10K at launch, then after lousy sales, it was slashed to its real value, $1,999. The PowerBook 100 was an odd model with the external floppy drive, then Apple had a fire-sale at Costco for $799 to unload the unsold inventory. Most people here were not born when the PowerBooks first came out, so they won't get it.
There is nothing different about any of the watches...they all do the same thing, they all have lousy battery life, and the only difference is the materials and the outrageous markups. The real value of the watch is shown in the $349 model. The rest are just markups. Why spend $1,000 when the $349 model will do the same thing? The tech is the same in all of them. I would imagine iPhone 5 users will complain about performance when it was really designed for the much faster iPhone 6. Remember, the iPhone is doing all the processing, not the watch. The watch is just a secondary display. If you don't believe that, review the watch SDK.
Remember the iPod Hi-Fi? Jobs claimed it was the best sounding speaker system on the market. It wasn't, and less expensive speakers had far better sound. Where is that iPod Hi-Fi now? Oh yeah, Apple quietly killed it without telling anyone. Not everything Apple makes is successful. The smart watch is a dumb category to get into.
Why do you say these are feminine styles? I've seen tan watch bands on a man's watch before. And I see guys in the gym with neon pink workout gear. I'm not saying these particular styles don't appeal more toward women, but they're fairly gender neutral.
Rich is indeed relative. However wealth is a power distribution. The real rich (the super rich) are the only possible market for a $17k item that is obsolete next year. The top 1-2 %.
Grabbing one of the many calculators at random a person with a $25,000 USD net income is in the top 2% of wage earners in the world.
Again, almost all Apple customers exist in the top 1-2% global category. You may not feel rich but you are.
Quote:
A millionaire would be careful on that. Someone earning $100k and paying tax, mortgage or rent -- he's not getting one unless he's stashed away some wealth and has no significant future outgoings.
People spend discretionary money on the things they decide is important to them. If you earn $100K and own a BMW you could easily have decided to buy a $17K watch and a Civic instead. Or a $17K cruise in the eastern med (Disney is damned expensive). Or $17K on a sound system.
Functionally they are the same but I'd say there's a clear aesthetic improvement as you go up the models. Look at the feminine styles:
...
With the iPhone, gold, silver and space grey are in the same price bracket and the Mac model price variation is nothing like 22x, the Macbook is $899, the top MBP is $3500 so under 4x. iPhones are $100 apart and similar with iPads.
Beauty is in the eye of the beholder. I like the space black stainless with space black metal band the best.
Women who wear watches tend to have a couple. The Apple watch can just be the sporty rather than dressy watch.
While 4x has been a traditional spread it doesn't mean that 22x is somehow against Apple's culture. As for the mac the desktop line has the biggest delta of $499 for the base Mini vs $9,599 for a fully kitted Mac Pro. 19x difference between the lowest model and the highest. But it's a spurious point.
The fact that he affordable (for Apple) base model watch has exactly the same functionality as the most expensive meets any reasonable expectation for "inclusion and diversity" among customers that can afford their products at all.
Even people that have $10K to $17K (plus tax) to spend on a watch will NOT buy a watch with a battery that cannot last one day. Face reality, it is not that hard to figure out. No one is that stupid.
blah blah blah
Remember the iPod Hi-Fi? Jobs claimed it was the best sounding speaker system on the market. It wasn't, and less expensive speakers had far better sound. Where is that iPod Hi-Fi now? Oh yeah, Apple quietly killed it without telling anyone. Not everything Apple makes is successful. The smart watch is a dumb category to get into. But I am sure most here will beg their parents to buy them one.
Even people that have $499 to $599 (plus tax) to spend on a phone will NOT buy a phone with a battery that cannot last one day. Face reality, it is not that hard to figure out. No one is that stupid.
Oh wait.
Yes, not everything Apple makes is successful. Since you feel so strongly that the Apple watch will tank then it should be obvious that shorting the stock will be brilliant since the failure of the Apple watch will crater the stock.
Grabbing one of the many calculators at random a<span style="line-height:1.4em;"> person with a $25,000 USD net income is in the top 2% of wage earners in the world.</span>
Again, almost all Apple customers exist in the top 1-2% global category. You may not feel rich but you are.
People spend discretionary money on the things they decide is important to them. If you earn $100K and own a BMW you could easily have decided to buy a $17K watch and a Civic instead. Or a $17K cruise in the eastern med (Disney is damned expensive). Or $17K on a sound system.
You, and that site, don't really understand how to measure wealth or income distribution. I expect the stats are way out of date particularly since I put in $1000 and got into the top 50% but except for sub-Saharan Africa nearly every country in the world has a GDP per capita higher than $1000. India is about $6000 per person, China is effectively a middle income country. I think it's $11k this year.
The other problem is this. You can't measure power distributions by population percentages but by the percentage on income gained by that percentile. If you are in the top 10% of app developers you are richer than 90% of app developers but still poor. If you are in the top 10% of income earners in the 12th century you are still poor. I think that's true now ( in relative terms).
I don't even think there's much of a middle class.
None of this is relevant to who is buying the watch. And you really don't understand discretionary purchasing if you think that someone on $100k would plop down $17k no questions asked. He might if his savings were high and he owns a property outright ( but that's dependent not on income but wealth -- it would equally be true of a trustifarian with a million in the bank who is earning $10k working for a charity).
A middle class guy on $100k with normal or low savings, who is paying rent or mortgages out of his post tax, who is saving for college and a pension, he's lucky to have a 5c. And a civic.
Comments
If true, that is simply scandalous - in fact, I am not aware of ANY Apple device comprising such a criminal profit margin - not even the IIfx or the 20th Anniversary Mac did that. So no; I still cannot believe the gold one contains only 1k worth of gold.
The profit margin on the Steel version could possibly be even higher at $1000. The material cost for the case and strap is likely negligible.
The steel version strikes me as an absolute rip-off; it makes me sad.
I regard a steel strap as inferior to a leather one. Apple are charging £129 for the leather in the UK and £379 for the steel strap. Utterly ridiculous. Apple should be deeply ashamed of themselves.
Okay. I was just going by your post, which seemed to surmise that Apple were stretching the truth by using less than 75% gold.
Well they are - by volume - it might be as little as 28% gold, but the karat definition is by mass. http://leancrew.com/all-this/2015/03/apple-gold/
The trouble is they have no market experience here yet. They did this with the iPhone starting at $599 subsidized and then dropped the price to $399 once they got a feel for the demand:
http://www.engadget.com/2007/09/05/apple-cuts-iphone-price-to-399/
It's hard to come out and say they are only making say 10,000 edition units and then discover they could sustain those prices for 50,000 units. At the same time, without saying how many they're making, it's hard for buyers to assess the exclusivity they are investing in.
They should probably commit to a reasonable figure and then the next model would be a different design. This is probably why they're having a preorder:
http://store.apple.com/us/buy-watch/apple-watch-edition
That will give them a rough indicator of how many they'd sell at launch and which type of gold. Then they'd be able to say something like 20,000 of rose gold and 30,000 of yellow gold.
If they aren't going to change the design much between revisions, I'm not sure how this exclusivity is going to work. Traditional watch designs change quite noticeably.
Sure.
In the end, it all comes down to perception. In the first instance, will Apple's margins be similar to those of similar gold jewellery? In the second, would those margins be justified considering the ephemeral nature of the Apple Watch? As others have said, this is the first time anyone has tried to sell a short-lived gadget as a piece of jewellery, notwithstanding bling customisations.
My feeling is that it is a terrible mistake, but who knows; maybe it'll be a huge success.
Because of the stacked design I think the casing and change dramatically YoY without the internal footprint changing much, or at all.
Sure.
In the end, it all comes down to perception. In the first instance, will Apple's margins be similar to those of similar gold jewellery? In the second, would those margins be justified considering the ephemeral nature of the Apple Watch? As others have said, this is the first time anyone has tried to sell a short-lived gadget as a piece of jewellery, notwithstanding bling customisations.
My feeling is that it is a terrible mistake, but who knows; maybe it'll be a huge success.
I would be very surprised if the Edition is a hit in Asia. The perception will likely be that there is less actual gold, given the size, than would normally be expected of an 18K gold watch like a Rolex, etc. As you say, it may all come down to perception.
The steel band looks nice and symmetric but a bit over-engineered. It looks like each link has a button on it to remove the link. That's great for easily customizing the strap length without tools but you do this once.
Functionally they are the same but I'd say there's a clear aesthetic improvement as you go up the models. Look at the feminine styles:
$350
$750
$17,000
With the iPhone, gold, silver and space grey are in the same price bracket and the Mac model price variation is nothing like 22x, the Macbook is $899, the top MBP is $3500 so under 4x. iPhones are $100 apart and similar with iPads.
The crown limits how thin they can go, maximum would less than 20% thinner roughly and the insides must be packed to get enough battery life. Battery advances are slow.
It's the same story on the components of mechanical watches and lines — except with smartwatches we have an entire SIP commonly measured in nanometers — and the styling of the cases vary wildly. This is why I wouldn't be surprised to see Apple have standardized the internal sizes so that they can have massive YoY casing and strap changes, with some new internals being able to fit inside older casings.
Look at the feminine styles:
Why do you say these are feminine styles? I've seen tan watch bands on a man's watch before. And I see guys in the gym with neon pink workout gear. I'm not saying these particular styles don't appeal more toward women, but they're fairly gender neutral.
Even people that have $10K to $17K (plus tax) to spend on a watch will NOT buy a watch with a battery that cannot last one day. Face reality, it is not that hard to figure out. Apple only allowing 30 minute viewing time for a $10K product is ridiculous. Apple should allow as much time as they want if they are a serious buyer. But then Apple is not going to sell many gold versions anyway, so they will have plenty of open appointments. It is strange that Apple is releasing so many different variations when they have not even tested the market to see if people want it. The smart watch market is not successful. That has been proven. Even the activity bands are not that popular. You don't see the masses wearing fit-bits. Apple failed miserably with the Performa line of Macs because they had too many models to choose from, and it got too confusing. Is Apple going to stock every single variation so people could sample the bands and the feel of the watch? Probably not.
The amount of gold in the watch is not worth $10K. It is not that much gold. Apple has always been known for ridiculous markups, especially on an item like this. Remember the 20th Anniversary Mac? $10K at launch, then after lousy sales, it was slashed to its real value, $1,999. The PowerBook 100 was an odd model with the external floppy drive, then Apple had a fire-sale at Costco for $799 to unload the unsold inventory. Most people here were not born when the PowerBooks first came out, so they won't get it.
There is nothing different about any of the watches...they all do the same thing, they all have lousy battery life, and the only difference is the materials and the outrageous markups. The real value of the watch is shown in the $349 model. The rest are just markups. Why spend $1,000 when the $349 model will do the same thing? The tech is the same in all of them. I would imagine iPhone 5 users will complain about performance when it was really designed for the much faster iPhone 6. Remember, the iPhone is doing all the processing, not the watch. The watch is just a secondary display. If you don't believe that, review the watch SDK.
Remember the iPod Hi-Fi? Jobs claimed it was the best sounding speaker system on the market. It wasn't, and less expensive speakers had far better sound. Where is that iPod Hi-Fi now? Oh yeah, Apple quietly killed it without telling anyone. Not everything Apple makes is successful. The smart watch is a dumb category to get into.
Why do you say these are feminine styles? I've seen tan watch bands on a man's watch before. And I see guys in the gym with neon pink workout gear. I'm not saying these particular styles don't appeal more toward women, but they're fairly gender neutral.
Sounds like your gym is full of gay men.
Sounds like your gym is full of gay men.
What an offenseive quote. So what if it is?
Rich is indeed relative. However wealth is a power distribution. The real rich (the super rich) are the only possible market for a $17k item that is obsolete next year. The top 1-2 %.
Grabbing one of the many calculators at random a person with a $25,000 USD net income is in the top 2% of wage earners in the world.
http://www.globalrichlist.com
The average household net-adjusted income per capita is $39,531 a year which is above the OECD average of $23,938 per year.
Again, almost all Apple customers exist in the top 1-2% global category. You may not feel rich but you are.
People spend discretionary money on the things they decide is important to them. If you earn $100K and own a BMW you could easily have decided to buy a $17K watch and a Civic instead. Or a $17K cruise in the eastern med (Disney is damned expensive). Or $17K on a sound system.
Functionally they are the same but I'd say there's a clear aesthetic improvement as you go up the models. Look at the feminine styles:
...
With the iPhone, gold, silver and space grey are in the same price bracket and the Mac model price variation is nothing like 22x, the Macbook is $899, the top MBP is $3500 so under 4x. iPhones are $100 apart and similar with iPads.
Beauty is in the eye of the beholder. I like the space black stainless with space black metal band the best.
Women who wear watches tend to have a couple. The Apple watch can just be the sporty rather than dressy watch.
While 4x has been a traditional spread it doesn't mean that 22x is somehow against Apple's culture. As for the mac the desktop line has the biggest delta of $499 for the base Mini vs $9,599 for a fully kitted Mac Pro. 19x difference between the lowest model and the highest. But it's a spurious point.
The fact that he affordable (for Apple) base model watch has exactly the same functionality as the most expensive meets any reasonable expectation for "inclusion and diversity" among customers that can afford their products at all.
Even people that have $10K to $17K (plus tax) to spend on a watch will NOT buy a watch with a battery that cannot last one day. Face reality, it is not that hard to figure out. No one is that stupid.
blah blah blah
Remember the iPod Hi-Fi? Jobs claimed it was the best sounding speaker system on the market. It wasn't, and less expensive speakers had far better sound. Where is that iPod Hi-Fi now? Oh yeah, Apple quietly killed it without telling anyone. Not everything Apple makes is successful. The smart watch is a dumb category to get into. But I am sure most here will beg their parents to buy them one.
Even people that have $499 to $599 (plus tax) to spend on a phone will NOT buy a phone with a battery that cannot last one day. Face reality, it is not that hard to figure out. No one is that stupid.
Oh wait.
Yes, not everything Apple makes is successful. Since you feel so strongly that the Apple watch will tank then it should be obvious that shorting the stock will be brilliant since the failure of the Apple watch will crater the stock.
What no? Yeah, I didn't think so.
You, and that site, don't really understand how to measure wealth or income distribution. I expect the stats are way out of date particularly since I put in $1000 and got into the top 50% but except for sub-Saharan Africa nearly every country in the world has a GDP per capita higher than $1000. India is about $6000 per person, China is effectively a middle income country. I think it's $11k this year.
The other problem is this. You can't measure power distributions by population percentages but by the percentage on income gained by that percentile. If you are in the top 10% of app developers you are richer than 90% of app developers but still poor. If you are in the top 10% of income earners in the 12th century you are still poor. I think that's true now ( in relative terms).
I don't even think there's much of a middle class.
None of this is relevant to who is buying the watch. And you really don't understand discretionary purchasing if you think that someone on $100k would plop down $17k no questions asked. He might if his savings were high and he owns a property outright ( but that's dependent not on income but wealth -- it would equally be true of a trustifarian with a million in the bank who is earning $10k working for a charity).
A middle class guy on $100k with normal or low savings, who is paying rent or mortgages out of his post tax, who is saving for college and a pension, he's lucky to have a 5c. And a civic.
When can we reserve the 15 minute appointment or "try-on"? How?