Displays suggest willingness to make massive price cuts

Posted:
in Future Apple Hardware edited January 2014
From $3500 to $2000, Wow!



For some time I've thought that Apple is shy about making massive price cuts. Maybe partly out of pride (our machines really are worth double the price!), partly out of avoiding precedent (don't want customers to get the impression they can just wait and prices will drop). Lastly, let's face it, they know their customers are loyal and aren't going anywhere.



But maybe the display price changes indicate that Apple is preparing to get competitive on price. Apple really seems to be emphasizing software development and sales. I hope they are smart enough to lower the entry costs in terms of hardware.

Comments

  • Reply 1 of 19
    I suspect they simply dumped the display prices to sell more PowerMacs. If you decide to spend half a fortune on a shiny new WindTunnel® you won't want to put it next to a dirty old grey Dell 17-incher. You want something on par with the PowerMac. If the cost of the whole deal is prohibitive, you might just postpone the computer purchase. With the new prices, the ultimate combo suddenly appears much more within reach.
  • Reply 2 of 19
    cliveclive Posts: 720member
    All the price cuts illustrate is how massively over-priced the screens were in the first place - see the "widescreen" thread.
  • Reply 3 of 19
    are they "price cuts"? in fact, is apple making less profit on them?

    i'm thing that manufacturing costs have dropped.



    [ 01-29-2003: Message edited by: superkaratemonkeydeathcar ]</p>
  • Reply 4 of 19
    amorphamorph Posts: 7,112member
    There's no possible way that manufacturing costs on the 23" HD display dropped that much that quickly.



    Apple had been soaking people who wanted the very best - although not as much as other people selling HD displays had been. (This is not a practice that is in any way unique to Apple - it has a long history.) What just happened is that they adjusted their prices to reflect the fact that, in the current climate, the price was so high that almost nobody bought them, so even with the fat margins they couldn't justify their existence revenue-wise. It's no accident that the biggest cuts came at the top of the line.



    I believe the average selling price of a PowerMac last quarter was $1899? You simply don't continue offering a $3500 model under those circumstances.
  • Reply 5 of 19
    scottscott Posts: 7,431member
    Does anyone think that Apples? growing retail position is pushing prices down? It?s easy when you sell on line (over the phone) and you don?t have to confront customer price comparisons up front. But at the Apple store you know some Consumer Report reading sales circular clipping pain in the ass is coming in with a full price/feature breakdown and asking what Apple can do on price.



    I can almost here a conversion between Jobs and his favorite Apple Store manager.



    Jobs: How?s it going at the store.

    Manger: Well you see the numbers Steve. Christmas was good. We pushed a lot of third party peripherals and the in store demos seem to be generating sales at rate of 25 to 1.

    Jobs: What?s the weak point though.

    Manger: First time buyers are a little put off by the high entry cost and lack of BTO. The all in ones are great but it doesn?t fit most peoples needs.

    Jobs: High entry cost?

    Manger: Yea you see there?s a CompMicroDepotCenterWarehouseUSA down the street and they always have something on sale every weekend. They come in at least 500 less than us all the time. The customers come in with the circular every weekend.

    Jobs: Push the eMac.

    Manger: We do but like I said before the AIO is not the right fit for most people. We need more flexibility on the lower end.





    Jobs gets off phone to think about it





    Or am I crazy?
  • Reply 6 of 19
    jlljll Posts: 2,709member
    [quote]Originally posted by Amorph:

    <strong>There's no possible way that manufacturing costs on the 23" HD display dropped that much that quickly.</strong><hr></blockquote>



    Please remember that Apple have had display promos in over a year.
  • Reply 7 of 19
    bodhibodhi Posts: 1,424member
    I wish people would stop calling these machines a nickname that was created by of all people: MOSR.



    Wind Tunnel. <img src="graemlins/oyvey.gif" border="0" alt="[oyvey]" />
  • Reply 8 of 19
    pbg4 dudepbg4 dude Posts: 1,611member
    The original cinema display received this kind of price cut. In fact they only cut the price once, from $3,499US to $2,499US. So, there definitely is precedent, at least where the super pricey displays are concerned.
  • Reply 9 of 19
    cliveclive Posts: 720member
    [quote]Originally posted by JLL:

    <strong>Please remember that Apple have had display promos in over a year.</strong><hr></blockquote>



    What, $200 rebates? That mostly applied in the US only?
  • Reply 10 of 19
    jlljll Posts: 2,709member
    [quote]Originally posted by Clive:

    <strong>



    What, $200 rebates? That mostly applied in the US only?</strong><hr></blockquote>



    The rebates where in Europe too, and the last one saved you $500 on the 23".
  • Reply 11 of 19
    warpdwarpd Posts: 204member
    Well to be honest, it really isn't hard to drop the price so drastically overnight if you have been charging rediculously inflated prices for them for the past 10 months!



  • Reply 12 of 19
    amorphamorph Posts: 7,112member
    [quote]Originally posted by JLL:

    <strong>Please remember that Apple have had display promos in over a year.</strong><hr></blockquote>



    I don't count rebates as price cuts, because they work on the (statistical) fact that very few people actually mail them in.



    I don't count bundles as price cuts, either, because you have to spend even more money to get them.



    The current round of price cuts is much larger for the 23" than any such offers, and it applies immediately and unconditionally to anyone who purchases one. So I consider it different, and abrupt.



    I don't think that's a bad thing. Far from it.
  • Reply 13 of 19
    kidredkidred Posts: 2,402member
    [quote]Originally posted by Nordstrodamus:

    <strong>From $3500 to $2000, Wow!



    For some time I've thought that Apple is shy about making massive price cuts. Maybe partly out of pride (our machines really are worth double the price!), partly out of avoiding precedent (don't want customers to get the impression they can just wait and prices will drop). Lastly, let's face it, they know their customers are loyal and aren't going anywhere.



    But maybe the display price changes indicate that Apple is preparing to get competitive on price. Apple really seems to be emphasizing software development and sales. I hope they are smart enough to lower the entry costs in terms of hardware.</strong><hr></blockquote>



    I'm still blown away by the cuts. (I'm in the process of putting my cinema display on ebay so I can get the 23") Seeing how everything they've updated since the pBooks have been slashed price wise, I sure hope the trend continues. The 2 slaps againgst Apple was price and performance. Apple is catching up on the performance part so the price cuts should put Apple into a nice position later this year. I wonder what the iMac cuts will look like.
  • Reply 14 of 19
    matsumatsu Posts: 6,558member
    [quote]Originally posted by warpd:

    <strong>Well to be honest, it really isn't hard to drop the price so drastically overnight if you have been charging rediculously inflated prices for them for the past 10 months!



    </strong><hr></blockquote>

    ding ding ding! Give this man a prize!



    And the 17" is still way too expensive. In 6 months the 20 will seem too expensive unless Apple stays agressive in adjusting its price, right now, it's perfect! Don't forget that by the square inch this panel is cheaper to make and buy than an equivalent 20" 4:3 panel. And that will leave us again in the situation that has Apple displays as a good deal only if you're buying the very largest panels.



    Why don't they have reasonably priced 17" widescreen panels for sale. They could easily drop such a beast to 500USD, include a DVI connector and start making some money by selling the things to the PC and mac markets (as they should be doing with ALL of thei displays)
  • Reply 15 of 19
    [quote] From $3500 to $2000, Wow!

    For some time I've thought that Apple is shy about making massive price cuts. Maybe partly out of pride (our machines really are worth double the price!), partly out of avoiding precedent (don't want customers to get the impression they can just wait and prices will drop). Lastly, let's face it, they know their customers are loyal and aren't going anywhere.



    But maybe the display price changes indicate that Apple is preparing to get competitive on price. Apple really seems to be emphasizing software development and sales. I hope they are smart enough to lower the entry costs in terms of hardware.

    <hr></blockquote>



    And if they want people to buy at their retail stores they will have to reduce the lower the entry cost for each reach.



    Achieved to stunning effect with the Powerbook 12 inch...and they incredible £799 inc VAT iBook!



    Amazingly with the high end LCDs. (I'm with Nostrodamus, I'm still having therapy for that price cut. Apple 'leads' in price. I'm typing this lying down folks...) £1600 inc VAT for a 23 inch LCD Apple screen?



    :eek: :eek: :eek:



    Though, I would agree with Matsu, as welcome as the 17 incher move was, I still think they could have gone further with another £50 off it with a connector...



    The 'power'Mac move was hugely welcome to me. It's really reduced the cost of entry for 'Tower' PC switchers. A very substantial potential crowd. (Every PC owning person I know has a beige Tower and wouldn't try a Mac tower because of their prohibitive price. Contrary to the way Apple have been marketing it...Towers appeal to more than just art studios and print industry folk with large cheque books.)



    Though I get ticked off by the whole G4 saga, the recent updates make the 'power'Mac line look...urghh...hmmm...kinda competitive. £2K for a top line Apple tower? When have you ever seen that? Never? You'd be correct. But people aren't buying your £3.5 K towers...then what do you do? Hello Apple. Glad you've joined the real world.



    Contrary to what people on these boards often say. Apple have taken massive steps on pricing of their product in the last couple of months. No really.



    iBook.

    Powerbook.

    'power'Mac.

    LCD DISPLAYS.

    Awesome software for next to nothing or free?



    Is this the 'price premium' Apple?



    They ARE reducing the entry cost. Looks at the whole range. Something is happening. Apple's joing 'HALLLOH!' land. Before I get too carried away, I wanna see what they do with the iMac2 and eMac prices.



    I'm also kinda still holdin' out an' hopin' for a Dell cripplin' iCube cheap white headless standard sized box. Limited. Capable. But below £600 inc VAT kinda cheap.



    I think this shows Apple is launching a pre-emptive strike against Wintel. Aggressive on price, promotions and it's retail operations and strong growth on software development/revenue.



    What's happening?



    Gasp. Could...it be? Could it just possible be...that...Apple is think different?



    Lemon Bon Bon :eek:



    [ 01-29-2003: Message edited by: Lemon Bon Bon ]</p>
  • Reply 16 of 19
    [quote] Does anyone think that Apples? growing retail position is pushing prices down? It?s easy when you sell on line (over the phone) and you don?t have to confront customer price comparisons up front. But at the Apple store you know some Consumer Report reading sales circular clipping pain in the ass is coming in with a full price/feature breakdown and asking what Apple can do on price.

    I can almost here a conversion between Jobs and his favorite Apple Store manager.



    Jobs: How?s it going at the store.

    Manger: Well you see the numbers Steve. Christmas was good. We pushed a lot of third party peripherals and the in store demos seem to be generating sales at rate of 25 to 1.

    Jobs: What?s the weak point though.

    Manger: First time buyers are a little put off by the high entry cost and lack of BTO. The all in ones are great but it doesn?t fit most peoples needs.

    Jobs: High entry cost?

    Manger: Yea you see there?s a CompMicroDepotCenterWarehouseUSA down the street and they always have something on sale every weekend. They come in at least 500 less than us all the time. The customers come in with the circular every weekend.

    Jobs: Push the eMac.

    Manger: We do but like I said before the AIO is not the right fit for most people. We need more flexibility on the lower end.





    Jobs gets off phone to think about it





    Or am I crazy?



    <hr></blockquote>



    You're not crazy.



    Lemon Bon Bon
  • Reply 17 of 19
    [QUOTE] [/I believe the average selling price of a PowerMac last quarter was $1899? You simply don't continue offering a $3500 model under those circumstances.QUOTE]



    reallity check:-

    cost of the "fastest" G4 in UK at todays exchange rate.

    (Modem swoped for Bluetooth)



    2122.12Â*UK Sterling = 3,479.86Â*US Dollar



    If I was bitter and cynical I could add something caustic about the reason the costs of freedom are sometimes unseen is that you aren't paying them, but your proberbly not in the mood for satire at the moment so lets leave it.



    "We hope you enjoy your firework show"



    Where is Bill Hicks when you need him
  • Reply 18 of 19
    steve666steve666 Posts: 2,600member
    If Apple were really serious about lowewring their prices the cheapest tower wouldn't be $1500. That is still way overpriced.



    Add to this their cheapest monitor is $700! What are they thinking?.....................................
  • Reply 19 of 19
    matsumatsu Posts: 6,558member
    They need towers in the 999 range. There's absolutely nothing in the SP1Ghz to warrant its 1500USD price. The low end actually got substantially slower as a result of this "upgrade." Pathetic.



    [ 01-29-2003: Message edited by: Matsu ]</p>
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