Apple assails iSuppli iPhone 4 part cost estimates

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  • Reply 61 of 124
    melgrossmelgross Posts: 33,573member
    Quote:
    Originally Posted by Chopper View Post


    Well I thought it obvious I was having some fun with that, but I was mistaken, I see.



    Or maybe it's getting a little too serious around these parts?



    I don't know what an apostate is but you're no doubt referring to my "Faithful" comments? That's my way of avoiding "Fanboys", "Fanbois", "Apologists", "Fandroids" and such. It all means the same stuff I suppose, but I thought a refresh was in order. Seems I was wrong about that as well.







    It's increasingly difficult to tell how serious a person is. We've had three on this thread alone who have been trolling. Often (as was yours), people come on with sarcastic remarks intended to deflect any criticism of whatever they have to say. Your post fit within that format.
  • Reply 62 of 124
    chopperchopper Posts: 246member
    Quote:
    Originally Posted by austingaijin View Post


    Now you're just stirring the pot, Chopper. Apple never "had a bitch about it". If you listen to the call, the question was about Apple's margins. All Peter Oppenheimer said was:



    "I'm suggesting you don't put a lot of credence in these third party reports."



    That's about as far from "having a bitch" as you can get. It an extremely reserved reply.



    Apple has no intent of revealing it's costs or it's margins. It will never happen. By the same token, they don't like to be taken to task for excessive margins by people who are just speculating about them.



    Jesus people, why do you have to turn everything into a freakin' soap opera? This story is just about the biggest "non-story" I can imagine, yet somehow you manufacture a crisis.



    I agree that I'm stirring the pot, and if you've followed my posts then you'll notice that I have no time for Daniel Eran Dilger's 'articles'. Your comment that "This story is just about the biggest "non-story" I can imagine, yet somehow you manufacture a crisis" is close to being bang-on, but you need to change the "you" in there to the writer of the piece. Look at the title and the opening sentence.



    I also made a big deal about the word "B!tching" being a synonym for "sniping" a couple of posts back, so it was obvious to me that what I was writing was a parody, but apparently it's missed its mark.



    About the only thing I'm serious about is that Apple needs to get back to its ignoring that which it cannot gain anything from responding to.



    At this point, I might just fold my tent and steal away into the darkness, lest others take my jibes at DED as flame bait.



  • Reply 63 of 124
    chopperchopper Posts: 246member
    Quote:
    Originally Posted by melgross View Post


    It's increasingly difficult to tell how serious a person is. We've had three on this thread alone who have been trolling. Often (as was yours), people come on with sarcastic remarks intended to deflect any criticism of whatever they have to say. Your post fit within that format.



    Well I didn't think I need to add "Disclaimer: BTW this was a piss-take at Daniel Eran Dilger, not a troll" to posts that seem obviously slanted that way to me.



    So as a mod here, you've categorised me as a troll. In which case, it'll be just a matter of time until I get my ban so it seems a little pointless to continue to contribute if I have to scrutinise every word I write in case there's some line I'm unaware I'm about to cross.



    That doesn't promise a lot of enjoyment, I'm sure you'll agree. And if it's not enjoyable, there's really not much point.
  • Reply 64 of 124
    iamiendiamiend Posts: 10member
    [QUOTE=Apple sniped a shot at the component cost estimates ... suggesting that the estimates were not very close to reality.



    ...



    In January 2007, iSuppli published a preliminary report stating that the original 8GB iPhone cost just $280.83 in parts, six months before the phone was even available. After the phone became available, the group released a new estimate saying it cost just $265.83."[/QUOTE]



    Sooo.... I'm paying even MORE of a premium than I thought I was? \
  • Reply 65 of 124
    realisticrealistic Posts: 1,154member
    Quote:
    Originally Posted by DaHarder View Post


    Nope! But the Chinese do it well, and do it cheap.



    Savings from all that foreign manufacturing/outsourcing could be passed on to the consumer... from a more fiscally conscientious organization.



    Get a life, all corporations are fiscally conscientious of their own bottom line not the public's, otherwise they would be called charities. It is called capitalism.
  • Reply 66 of 124
    longfanglongfang Posts: 476member
    You all seem to have this notion that Apple shouldn't make a profit, which is kind of ironic seeing as how most of you are Americans and hold capitalism to be the be all and end all of economic systems.
  • Reply 67 of 124
    ckh1272ckh1272 Posts: 107member
    Quote:
    Originally Posted by DaHarder View Post


    Nope! But the Chinese do it well, and do it cheap.



    Savings from all that foreign manufacturing/outsourcing could be passed on to the consumer... from a more fiscally conscientious organization.



    Name one.
  • Reply 68 of 124
    ckh1272ckh1272 Posts: 107member
    Quote:
    Originally Posted by DaHarder View Post


    What's the big surprise...



    How else do people think Apple keeps posting these (questionably) astronomical quarterly profits?



    Hint: By charging 10 to 20 times more than the value of the actual hardware.



    So by your math, that would mean that the iPhone is at least $1870 U.S. Do you see the problem here??
  • Reply 69 of 124
    ckh1272ckh1272 Posts: 107member
    Quote:
    Originally Posted by iamiend View Post


    Sooo.... I'm paying even MORE of a premium than I thought I was? \



    The Motorola Droid cost $187.50, yet they were asking the same price as the 16GB iPhone 3GS. Are you going to hold Motorola to task as well? You'll find most comparable phones to have similar costs and similar prices to consumers. Apple is not alone in trying to make a profit. Don't like it? Build your own.
  • Reply 70 of 124
    sandorsandor Posts: 659member
    Quote:
    Originally Posted by DaHarder View Post


    What's the big surprise...



    How else do people think Apple keeps posting these (questionably) astronomical quarterly profits?



    Hint: By charging 10 to 20 times more than the value of the actual hardware.







    http://ycharts.com/search?q=MSFT%20v...=profit_margin



    Apple actually has the lowest margins of "the big three" ... By your train of thought, Google is the company screwing the consumer the most





    If they weren't making profits, we'd be bitching that they are lowering the value of our retirement plans. again
  • Reply 71 of 124
    constable odoconstable odo Posts: 1,041member
    Quote:
    Originally Posted by nicolbolas View Post


    if Apple can;t say something like the price is close to $100 under what they sell the phone its still a rip off, selling 9.5+ million phones at $100 made per phone would mean that any costs of design would be taken care of ove and over... so i still feel that it is outrageously priced (for sales they expect, if those sales were half or maybe even 2/3rds it would make more sense...)



    i feel that Apple would make monay of the iphone if they sold it for a penny above the manufacturing cost... (not really, but if it was $25 then it would be at least 10m (ip4 should sell at least this much before thye make a new one) that would be 25 million dollars... not including app's (new costumer,think it was like 25% of ip4 users are new (that or around 75% of 3g/gs users are going to ip4)



    i mean Apple is showing the world how much F***ing $ they have on hand, you can argue its not much in terms of costs for keeping a company going, but they keep making record profits... if the lowered the price of the ip4 lets say 25% (using that it costs aprox 300 for cheapest model) ($600 unsubsidized) the price would be $450... that is still a $150 profit margin per phone... if people had to pay $50 up front for the ip4 i bet a lot more people would buy it...



    What's your beef? Nobody is forced to buy Apple products. If you can't afford it, then you go elsewhere. You're saying that people who buy Apple products don't know they can get a similar product for less money? Why do people make money? To spend it on the things they want. It makes them feel they're in control of their lives. Buying Apple products are a choice, like buying a Lexus instead of a Kia. Lexus components aren't that much higher than what's in a Kia, so you could say Lexus is overcharging buyers. So what? That's the buyers choice. If they perceive they're getting a better product then that perception makes them happy whether it's true or not. I guess I never was raised to buy the cheapest stuff I could find, so I might be biased in certain respects. Still, the goal of any successful company is to keep customers satisfied. If they charge more for products and still achieve the goal of keeping customers satisfied, then what's the harm. If I were in business, I'd try to do the same thing.
  • Reply 72 of 124
    lochiaslochias Posts: 83member
    Quote:
    Originally Posted by peter02l View Post


    Don't give him a hard time. He is right. Apple should adjust its margins to the same level as Microsoft. Microsoft sold XP for 10 years at the same price. That is the proper way to take care of our customer. Office too has stayed a bargain for decades.



    And yet, while Apple gross margins (most recently 39.1%) are in line with the S&P average (38.8), Microsoft margins are more than TWICE those numbers (80.2%). Apple and Microsoft have roughly the same revenue ($15 billion or so this past quarter), but guess who still makes more money.
  • Reply 73 of 124
    jasonbeejasonbee Posts: 28member
    Quote:
    Originally Posted by AppleInsider View Post


    TechCrunch noted in its coverage of a recent report that "iSuppli is well-known for low-balling these numbers in an effort to convince manufacturers to contact them in order to connect with their preferred suppliers, so grains of salt must be taken."



    So what would one do with these grains of salt?



    Take them orally?



    Keep them in your pocket?



    I'm confused...
  • Reply 74 of 124
    anantksundaramanantksundaram Posts: 20,407member
    Quote:
    Originally Posted by DaHarder View Post


    What's the big surprise...



    How else do people think Apple keeps posting these (questionably) astronomical quarterly profits?



    Hint: By charging 10 to 20 times more than the value of the actual hardware.



    Don't be idiotic (you'll notice I did not say "you're an idiot," since that would have been inappropriate).



    Apple's profit margin is ~20%, hardly 'astronomical.' Look it up.
  • Reply 75 of 124
    daseindasein Posts: 139member
    Quote:
    Originally Posted by DaHarder View Post


    Nope! But the Chinese do it well, and do it cheap.




    OK, high school English teacher time: what's the antecedent for "it" in your statement? If "it" refers to production (by way of design and creation) of something like an iPad, they (the Chinese) have never done anything of the sort. If "it" refers to mass production, consider they do it by a very simple formula: dirt cheap labor in tandem with virtually no environmental laws. That's why companies worldwide, including Apple, have moved production over there. This is no different than companies in the U.S. moving their production facilities to the South and West after WWII in this country. Climb out of your shell and open your eyes.
  • Reply 76 of 124
    jeffdmjeffdm Posts: 12,953member
    An estimate that takes the total figure down to a penny is a bit much, estimates shouldn't have five significant figures. I've long felt that was to the point of making things up. The final figure could be off by a lot but how they present the final figure doesn't give any indication of their margin of error.
  • Reply 77 of 124
    dick applebaumdick applebaum Posts: 12,527member
    Quote:
    Originally Posted by nicolbolas View Post


    if Apple can;t say something like the price is close to $100 under what they sell the phone its still a rip off, selling 9.5+ million phones at $100 made per phone would mean that any costs of design would be taken care of ove and over... so i still feel that it is outrageously priced (for sales they expect, if those sales were half or maybe even 2/3rds it would make more sense...)



    i feel that Apple would make monay of the iphone if they sold it for a penny above the manufacturing cost... (not really, but if it was $25 then it would be at least 10m (ip4 should sell at least this much before thye make a new one) that would be 25 million dollars... not including app's (new costumer,think it was like 25% of ip4 users are new (that or around 75% of 3g/gs users are going to ip4)



    i mean Apple is showing the world how much F***ing $ they have on hand, you can argue its not much in terms of costs for keeping a company going, but they keep making record profits... if the lowered the price of the ip4 lets say 25% (using that it costs aprox 300 for cheapest model) ($600 unsubsidized) the price would be $450... that is still a $150 profit margin per phone... if people had to pay $50 up front for the ip4 i bet a lot more people would buy it...





    I want to come work for you-- you would pay me $25 more than you think I am worth.



    Then, because of taxes and regulations, you would pay a like amount (to what you pay me or any employee) to the Federal, State and local governments. Unemployment, Social Security, Insurance, Health care, etc).



    You have such a firm grasp on how business works, that you would have no problem attracting investors and top-notch employees-- to the degree that your business could actually produce something of value before it failed!



    ,
  • Reply 78 of 124
    dick applebaumdick applebaum Posts: 12,527member
    Quote:
    Originally Posted by DaHarder View Post


    What's the big surprise...



    How else do people think Apple keeps posting these (questionably) astronomical quarterly profits?



    Hint: By charging 10 to 20 times more than the value of the actual hardware.





    Quote:
    Originally Posted by DaHarder View Post


    Nope! But the Chinese do it well, and do it cheap.



    Savings from all that foreign manufacturing/outsourcing could be passed on to the consumer... from a more fiscally conscientious organization.



    With that line of logic, Apple could be even more "more fiscally conscientious" and reduce their prices to the actual costs of the product, foregoing any profit. Of course Apple would need to stop developing "new products" and fire all its employees before going out of business (and eliminating all those foreign jobs, too).



    It's called the "profit motive".



    The purpose of business is make a profit at the risk of a loss, period!



    Any social obligations or corporate responsibility a business chooses to assume are optional or dictated by law or regulation.



    Without the profit motive, the business ceases to exist!



    .
  • Reply 79 of 124
    dick applebaumdick applebaum Posts: 12,527member
    Quote:
    Originally Posted by Chopper View Post


    Since Apple won't supply iSuppli with the actual costs, it's a bit rich to expect iSuppli to be accurate in their estimates. If they want it to be accurate, then Apple could provide the info that allows it. If they want to be secretive about such things, then surely they have no business b!tching* when a company like iSuppli consequently makes what Apple deems to be inaccurate guesses.





    Apple's parts and mfg. costs are kept secret [as much as possible] because they provide Apple with an advantage-- similar to any other IP.



    In the past, Apple has paid in advance, millions of dollars, to secure production of high demand parts: RAM SSD,. etc. They are taking a risk for the potential reward of a profit.



    If apple were to publish their parts costs, production agreements, schedules... they would be providing competitors with valuable information that could be used against Apple.



    As an Apple shareholder, I would be among the first to join a lawsuit against the corporate executives for releasing this information to my detriment!



    .
  • Reply 80 of 124
    sendmesendme Posts: 567member
    Quote:
    Originally Posted by nicolbolas View Post


    if the lowered the price of the ip4 lets say 25% (using that it costs aprox 300 for cheapest model) ($600 unsubsidized) the price would be $450... that is still a $150 profit margin per phone... if people had to pay $50 up front for the ip4 i bet a lot more people would buy it...







    I think that Steve knows how to price his products to yield the maximum total profits. And that is what he cares about most. That's his job.
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