Apple rumored to sell Apple TV 4K, HomePod at cost

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Comments

  • Reply 21 of 98
    jbdragonjbdragon Posts: 2,078member
    If Apple is not at least making a 30% profit, they’re not going to sell it.  Let’s not also forget the places that sell it are not selling this stuff and breaking even also.  I got my second Homepod at Target for $249.  They have been sold st that price point at other places a few times.  This is the price I thing they should be selling at.  You think Target is losing money?  Really, who comes up with this garbage.  Apple always makes a good profit.  To say Apple is selling this stuff at cost is laughable.  
    SpamSandwichwatto_cobra
  • Reply 22 of 98
    “like horn-loaded tweeters and a custom amplification system into its smart speaker. Further, HomePod includes high-end features like dynamic audio processing, beamforming, automatic bass calibration and other exotic niceties.”

    high end end features that don’t cost much to manufacture.  “Horn-loaded tweeters” are just tweeters with 10c worth of plastic in front of them.  It’s basically an old mass produced apple processor with some speakers, microphones and a networking chip.  All the smarts are just done in software.  Sure it cost a bit to design, but I doubt the parts cost more than $100.
    kitatit
  • Reply 23 of 98
    saareksaarek Posts: 1,123member
    I wish I could use my HomePods as a home entertainment sound system for my TV. 
    irelandpatchythepiratewatto_cobra
  • Reply 24 of 98
    maxit said:

    I can’t understand why HomePod isn’t distributed worldwide... I would be glad to buy one in Italy.
    Well, it might just be that the topic of this article holds the answer to this question — Apple is still loosing money on them, or not gaining enough. Why push sales on a product if you don’t really want to sell it? I mean, Apple is not even trying.
    edited February 2 williamlondonracerhomie3
  • Reply 25 of 98
    irelandireland Posts: 17,570member
    mobird said:
    "Further, HomePod includes high-end features like dynamic audio processing, beamforming, automatic bass calibration and other exotic niceties."

    Don't forget the sound facility Apple built which if I recall is in the multi-millions of dollars. They used it extensively in the HomePod development.
    You cannot apply the cost of that facility on HomePod only, because Apple would have clearly known they could use it for any Apple product and most likely they had this facility long before HomePod. It would be an Apple R&D spend, not a HomePod only R&D spend. This is not a wind tunnel for Apple car which is used only for Apple car development. To cost that exclusively for HomePod is marketing Ju-jitsu and spin. They didn’t launch HomePod and suddenly turn around and say, “OMG I just remembered, iPhone has a mic too... and iPad, and Mac, and AirPods, and practically every future product we will ever make. We can use this sound facility again”!
    edited February 2 ksecchiawatto_cobra
  • Reply 26 of 98
    ksecksec Posts: 1,554member
    Gruber has been consistently wrong about everything with regards to BOM cost. 

    I mean, seriously, if you have zero expertise in that field don't try to speculate. And NO, the AirPods are not sold at cost. 

    And now after all these website publishing, we have zillion of idiots who would argue for Apple saying they sold at cost, without going through a little research or googling how this is far from truth.

    Apple's pricing has been extremely simple, and their BOM cost reverse calculation has been straight forwards for nearly a decade I have no idea why these Apple's fellows still don't get it. 
    watto_cobra
  • Reply 27 of 98
    asdasdasdasd Posts: 5,283member
    cornchip said:
    mobird said:
    "Further, HomePod includes high-end features like dynamic audio processing, beamforming, automatic bass calibration and other exotic niceties."

    Don't forget the sound facility Apple built which if I recall is in the multi-millions of dollars. They used it extensively in the HomePod development.
    Maybe technically selling at a loss if you factor all that in?
    You don’t include R&D in margin calculations. 
    StrangeDaysdesignrbeowulfschmidt
  • Reply 28 of 98
    Tech Insights calculated that Apple makes about 29% margin on every HomePod.


    edited February 2 pscooter63dewme
  • Reply 29 of 98
    Technically maybe a loss or break-even. But in reality they made millions.
    They mass produce components to get bulk discounts.
    Ex. Out of those 50,000,000 million chips it produced. It used 40 million for new items. Then after producing a new range of chips it’s stuck with 10 million old chips.  Many manufactures may write it off as a loss and destroy them.

    But no, apple uses them in their hi-tech speakers, hence preventing a loss.

    They don’t need a 30% margin. Not destroying those components but rather dumping them even at cost price is a win for them.

    Would you rather write a 10 million USD loss for those chips or maybe 500,000 USD in manufacturing costs?
    williamlondonwatto_cobra
  • Reply 30 of 98
    No way that it is true. New Apple TV is $149 or something (maybe $129). Old one was $79. That is a huge increase in price. Comparable products from Amazon and Roku are $19 to $49. Now those are sold at cost or a slight loss. No way is Apple selling these at a lost. More like 40% minimum gain on each sell.
  • Reply 31 of 98
    crowleycrowley Posts: 5,799member
    When I buy a product the most important thing is to appreciate the value of its components and labour¡
    edited February 2 pscooter63
  • Reply 32 of 98
    GeorgeBMacGeorgeBMac Posts: 4,299member
    All the comments and commenters declaring they know what Apple does with margins are simply demonstrating that they have no understanding of marketing.

    Both Apple TV and Homepod are nothing more than Apple dipping its toes into new markets -- and, perhaps, trying to maintain a toe-hold in the market.   That is:   Apple is concerning themselves with the market first and margins (even if negative) second.

    One analogy is your local supermarket selling steak for $2.99/Lb (limit 1 pound per customer).   They aren't trying to sell steak -- they likely lose money on every sale.  What they are trying to do is get you in the door because, they know that once you're in there you will likely do the rest of your shopping there and they'll more than make up the loss with the $4.00 box of cereal.

    Another analogy is the Apple Watch:   Apple sold the first 3 generations of the (aluminum) watch at ridiculously low prices -- because they were trying get it into people's hands (or on their wrists) in order to open up the market.  They have largely done that, or enough of it, and the price of the Series 4 jumped.  Now, a fully configured Series 4 (aluminium) with AppleCare is priced at north of $600 -- which is in iPhone territory.
    It's not that the Series 4 cost too much, but that Series 0-3 cost too little.   But, they accomplished their marketing goal which was the more important.  Now, they can start taking their more normal margins on the product.
    Gabyridyratracerhomie3StrangeDays
  • Reply 33 of 98
    GabyGaby Posts: 55member
    saarek said:
    I wish I could use my HomePods as a home entertainment sound system for my TV. 
    @saarek you can for 2 channel. 
    williamlondon
  • Reply 34 of 98
    eideardeideard Posts: 385member
    "Smart TVs are everywhere" - so are porta-potties. I've been a TV geek longer than a computer geek and started with the latter in 1981. So-called smart TVs are about as competent as the Tandy Model 100 I have stashed in the back of our study closet.
    lkruppGeorgeBMacpscooter63watto_cobra
  • Reply 35 of 98
    neilmneilm Posts: 598member
    hentaiboy said:
    Tech Insights calculated that Apple makes about 29% margin on every HomePod.


    I'm afraid that Gruber has little understanding of manufacturing costs in China. That said, both the HomePod (don't have one) and AppleTV 4K (do have one) are clearly more expensive by design and content than other products in those spaces. That's OK — Even though they both get you to the same supermarket, a Mercedes is more expensive than a Ford.
    edited February 2 ridyratracerhomie3watto_cobra
  • Reply 36 of 98
    MplsPMplsP Posts: 1,293member
    All the comments and commenters declaring they know what Apple does with margins are simply demonstrating that they have no understanding of marketing.

    Both Apple TV and Homepod are nothing more than Apple dipping its toes into new markets -- and, perhaps, trying to maintain a toe-hold in the market.   That is:   Apple is concerning themselves with the market first and margins (even if negative) second.

    One analogy is your local supermarket selling steak for $2.99/Lb (limit 1 pound per customer).   They aren't trying to sell steak -- they likely lose money on every sale.  What they are trying to do is get you in the door because, they know that once you're in there you will likely do the rest of your shopping there and they'll more than make up the loss with the $4.00 box of cereal.

    Another analogy is the Apple Watch:   Apple sold the first 3 generations of the (aluminum) watch at ridiculously low prices -- because they were trying get it into people's hands (or on their wrists) in order to open up the market.  They have largely done that, or enough of it, and the price of the Series 4 jumped.  Now, a fully configured Series 4 (aluminium) with AppleCare is priced at north of $600 -- which is in iPhone territory.
    It's not that the Series 4 cost too much, but that Series 0-3 cost too little.   But, they accomplished their marketing goal which was the more important.  Now, they can start taking their more normal margins on the product.
    Agreed - Concepts like ‘cost’ and ‘profit’ can get muddy quickly. If an outstanding tweeter can be manufacturered for $5 but you spent $5M figuring out how to make it that good for that cheap, what is it’s cost? If Bose already has an acoustic facility but you have to pay $20M to build one, how do you count that money? On the other end is the ‘razor blade model’ (or grocery store model). Loss-leaders that drive sales still generate profits. 

    We can all speculate and pontificate all we want, but none of us knows the true costs or profits from any of apple’s products. You can bet that Apple has spent some time analyzing them, though. In the end, what really matters is whether you think a product is worth the cost to buy. If no one buys, it doesn’t matter how much Apple is making or losing.
    GeorgeBMacracerhomie3StrangeDaysIreneW
  • Reply 37 of 98
    macxpressmacxpress Posts: 4,829member
    Fatman said:
    Apple does not sell any product at a loss or break even. Period. It’s even rare for their margins to be in the single digits.
    They've done it before....and my god it was under the amazing Steve Jobs even! Apple sold the original AirPort Base Station at a loss. 
    edited February 2 GeorgeBMacracerhomie3
  • Reply 38 of 98
    bitmod said:
    MisterKit said:
    The technology in HomePod is indeed not appreciated by many. It’s in a class of its own at any price.
    No. No it's not. Not even close. Not even in the same ball park as other offerings. So far behind you think it's first. 
    Venture into a hifi shop and not your local dollar store - you will be amazed. 
    ‘At any price’ is obv not true. But this prooduct is not competing against $1200 speakers or $29 Echo dots.  

    This product is more than just a high quality $349 speaker tho. It is the only ‘smart’ speaker with Siri integration and is a HomeKit hub. People can rail against Siri all they want but it works perfect for playing music and controlling HomeKit devices.  No other ‘smart’ speaker can do those 2 things (siri and HomeKit) and be the best sounding ‘smart’ speaker in its price range. Every software update makes the HomePod that much better.

    If you live in the Apple ecosystem the HomePod is great and for my family it adds value to the ecosystem experience.  If you dont, then of course you wouldnt pay for it, even if it was $29.
    racerhomie3
  • Reply 39 of 98
    jcs2305jcs2305 Posts: 722member
    bitmod said:
    MisterKit said:
    The technology in HomePod is indeed not appreciated by many. It’s in a class of its own at any price.
    No. No it's not. Not even close. Not even in the same ball park as other offerings. So far behind you think it's first. 
    Venture into a hifi shop and not your local dollar store - you will be amazed. 
    Bullshit. Nonsense talk as usual. 
    StrangeDayspscooter63
  • Reply 40 of 98
    jcs2305jcs2305 Posts: 722member
    k2kw said:
    Best Buy and other retail stores had the HomePod for $250 during Christmas.   I imagine they must cost Apple less than that to make.  Since they didn’t brag on it during the earnings call it’s probably their biggest flop since they 5C.   But we Will probably have an editorial from DED that it’s the greatest smart speaker.

    The speaker has been out less than a year and has slowly rolled out to different markets since the ?!  It only hit China on January 18th 2019!What actual evidence or numbers do you have to back up anything you wrote above ? Why is there so much hate for this freaking speaker. Hahaha it’s a joke anymore. 

    People who don’t even own the thing spouting off complete bullshit. Wow 
    roundaboutnow
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