Right, China is the real target because the rest of the world is already fed up with AAPL! Asia is Apple's last gasp and only hope to not entirely go down the crapper. Samsung and Google have eaten AAPl's lunch -- past tense, game over! With Steve gone Apple has become a pathetic joke unable to protect its core IP and brand.
AAPL > $447 and free falling............................
How wrong, and annoying, can you possibly be? Clueless is the perfect descriptor.
In order to break through in China Apple would have had to priced this mid tier. Remember that in China the product is going to cost more and that there is no option to put the cost of the device into the contract. They have to pay for it up front. And, people tend to have less money in China than the US.
Will it sell in China? Yes. Will it sell well? Yes. Will it have a breakthrough? No. It will be a niche product.
With all due respect, as to China, you have no clue what you are talking about. Consumers in China have one of the highest savings rates in the world, and will save for months to buy a luxury product, an iPhone included. It is now the second largest luxury goods market in the world, and is estimated to become the largest within just the next few years. As an expat living in China I know exactly what I am talking about. The number of Audis, BMWs, Mercedes, Porsches, etc. on the streets here is mind boggling! Even young working girls living at home will save for months to buy a real LV handbag. Further, the carriers are offering deals on the phones as well as payment plans so Apple will continue to do quite well here. And later this year, when the China Mobile deal finally launches, the market is going to explode. There are already 35 million iPhones on their network even thought they only work at 2G speeds as they are not compatible with their high speed network. With the new phones now able to work on their new LTE network sales are going to explode among their 700 MILLION customers.
Except the AT&T/Verizon subsidy is $450. So that basically puts a floor on the off contract price. But why couldn't Apple price the phone at $450 with a $350 carrier subsidy? Bottom line is $549 for a 16GB unlocked plastic phone is expensive. I don't care if its the best fucking plastic phone Jony Ive ever built.
I see you spiraling more and more out of control on this. You are not basing your opinion, ok judgment, about the price on the factors we plainly have to work with. I've mentioned them before, maybe to you, but I don't see any sign that you agree with the logic.
One more time. The 5 would normally be sold unchanged for the same price as the 5C this time around for the same as they've priced the 5C. But the 5C has some expensive changes that you are not taking into account: the radios, the front camera, an elaborate new manufacturing process for the case that has to be paid for, and twelve or eighteen new variations that have to be rationalized in supply, production and inventory, etc.
You want them to just give all this away and cut into their margins? You want to assume that you know their costs and pricing strategies better than they do? Please at least acknowledge these issues if you want to be taken seriously here.
It remains to be seen if Apple can get away with it. The question becomes, is Apple a product company or a profit margin company? Because the 5C pricing wreaks of some bean counter saying 'older models are selling well so we need an older model that is cheaper to make so margins are better'. Now don't get me wrong, I don't doubt that 5C is a great phone, a well built phone. Jony Ive & Co. don't build junk. But I think it's too expensive. Price it $50-$100 cheaper and it would be huge. As it is priced now I think it will be modestly successful.
Same with this post, which reeks of Internet armchair bean counting. They are not increasing margins with the 5C, they are maintaining margins. They would be pilloried for exploiting the advantage that plastic supposedly gives them. In fact, the advantages of using plastic won't be felt for several months or a year, or more. (That's a reasoned conclusion. I can't cite any hard data yet.)
AAPL doesn't deserve the benefit of any doubt. If they were trying to match the bodily functions of death the company couldn't have picked 4 fuglier colors! Any magic this company had is gone and as a Apple early adopter and investor I couldn't be more disgusted with management. We have the worst of Jerry Yang and Steve Balmer in Tim Cook, a guy who couldn't get it right if his life depended on it. Based on its new products I can confidently say APPLE SUCKS!
Do you realize Apple is with the iPhone 5S still leading the mobile industry tech ? They are bringing to the market what competitors couldn't dream about. Touch ID, 64 bit system for mobile and a motion sensor co processor. They bring in all that power still maintaining the 112g weight and 7.2mm thickness at a 4 inch screen. Now that's what the customers are buying into. You it seems have fallen for the rest of the competitor paid media, coz you lack common sense to see the truth with your own eyes. Apple is by far ahead of this mobile race by a long shot. The rest if the mobile industry is swimming over an uncertain Android while iOS 7 is pushing mobile software in whole new directions.
the amount of analyst/pundit stupidity about the 5c and 5s may be at an all time high this time. and that is saying something!
the 5c of course is just last year's iPhone 5 with a modest spec bump and new fun plastic colors. which means an even better iPhone than before for $100 less (or even less than that where discounted). and next year it will replace the 4s, still on sale now, at its $-0- plus contract price point - but the stupidheads just can't wait that long i guess.
with this three-model price tiering Apple of course is protecting is overall profit margins instead of joining the android race to the profits bottom. why the stupidheads think selling iPhones at low margins is smart i really can't guess. i suppose they claim it is needed for "market share," because ... well, just because, you know? bragging rights are all that matters!
what Apple really IS doing about market expansion this year is finally getting deals in place with the #1 telcos in both Japan and China, two huge markets. the DoCoMo deal is done and look at what is happening!
the China Mobile deal may also be done, but can't start until CM's 4G network is ready - soon. and if the following report is true, there are already 10's of millions of unlocked/jailbroken iPhones running on its old 2G network now:
now today we are hearing the stupidheads whining about Apple's not releasing first weekend 5c pre-order totals, concluding therefore that must mean sales were poor. instead of the obvious necessity to simply wait a week until both the 5s and 5c are both available for sale/preorder next weekend to have a real idea about overall initial demand. but the stupidheads just can't wait that long either i guess.
finally we have stock market "investors" short-selling speculators being cited as a key indicator for both iPhones' prospects. the stupidheads haven't yet grasped that Apple stock is clearly being gamed by the professional traders, cynically using rumors as their market-moving tools. those speculators might even include a few of the stupidheads who are actually just pretending to be that stupid on purpose. very few of these web pundits ever disclose their investments, as real journalists are expected to do ...
Same with this post, which reeks of Internet armchair bean counting. They are not increasing margins with the 5C, they are maintaining margins. They would be pilloried for exploiting the advantage that plastic supposedly gives them. In fact, the advantages of using plastic won't be felt for several months or a year, or more. (That's a reasoned conclusion. I can't cite any hard data yet.)
How do we know margins aren't increasing? We don't know either way but one would assume Apple didn't move to plastic because its more expensive to manufacture.
I see you spiraling more and more out of control on this. You are not basing your opinion, ok judgment, about the price on the factors we plainly have to work with. I've mentioned them before, maybe to you, but I don't see any sign that you agree with the logic.
One more time. The 5 would normally be sold unchanged for the same price as the 5C this time around for the same as they've priced the 5C. But the 5C has some expensive changes that you are not taking into account: the radios, the front camera, an elaborate new manufacturing process for the case that has to be paid for, and twelve or eighteen new variations that have to be rationalized in supply, production and inventory, etc.
You want them to just give all this away and cut into their margins? You want to assume that you know their costs and pricing strategies better than they do? Please at least acknowledge these issues if you want to be taken seriously here.
When did I ever say I wanted Apple to give all this away? The stock is down ~$55 since Apple announced these phones. I'm not the only one questioning the pricing strategy of the 5C. And I'm questioning it because I want more people to chose iPhone. I don't want them to chose a Moto X or Nokia Lumia. But more price sensitive people might go for one of those phones because they're "good enough" and cheaper. And people who aren't price sensitive will just spend $100 more and get the finely crafted (I think Ive used those words) aluminum and glass 5C with all the new features.
Right, China is the real target because the rest of the world is already fed up with AAPL! Asia is Apple's last gasp and only hope to not entirely go down the crapper. Samsung and Google have eaten AAPl's lunch -- past tense, game over! With Steve gone Apple has become a pathetic joke unable to protect its core IP and brand.
AAPL > $447 and free falling............................
Your argument has no supporting statements (so to call it an argument is a misnomer). Back up your claims otherwise your "point" is moot.
How wrong, and annoying, can you possibly be? Clueless is the perfect descriptor.
Please back up your comment with supporting statements or don't comment at all. Otherwise it's basically name calling and that's the realm of children (then again I don't know that you're not an eight year old).
How do we know margins aren't increasing? We don't know either way but one would assume Apple didn't move to plastic because its more expensive to manufacture.
Thanks for engaging this question. We don't know, as you suggest, but we can reason.
The highest margin would have resulted from just selling the unchanged 5 for another year as the mid-tier $100/$550 phone. But that does nothing for China Mobile, and nothing for the "newness" and young hipster factor, including for Asia, because the iPhone 5 is a work of art, not fun. And the 5 is not durable.
So they redid the phone with new radios, camera, and battery, and invested in new machines and production capability to make that plastic case, which everybody thought, me included, was going to be a simple injection-molded snap-in affair.
Looking at it this way, all the savings they gain from not doing an aluminum back with glass inserts is used up by the changes they had to invest to transform the 5 into a world fun/fashion phone, done well in the usual Ive manner. So until the new plastic production costs are paid down, they might even be taking a cut on their margins for this new phone.
I think many are assuming the plastic back is already cheap to make. It doesn't look like that to me at all.
When did I ever say I wanted Apple to give all this away? The stock is down ~$55 since Apple announced these phones. I'm not the only one questioning the pricing strategy of the 5C. And I'm questioning it because I want more people to chose iPhone. I don't want them to chose a Moto X or Nokia Lumia. But more price sensitive people might go for one of those phones because they're "good enough" and cheaper. And people who aren't price sensitive will just spend $100 more and get the finely crafted (I think Ive used those words) aluminum and glass 5C with all the new features.
No you're not the only one, in fact you're probably with the majority. But you're appealing to the least knowledgeable "authority" possible, the Market.
As far as people choosing Moto or Lumia, they may have to do something like that because the 5C will probably be in short supply for awhile. If not, if they go to the Dark Side only to save a hundred dollars, well, they will get what they paid for.
How do we know margins aren't increasing? We don't know either way but one would assume Apple didn't move to plastic because its more expensive to manufacture.
If the 5 would be sold, it would be $100 less than the year before. I doubt going to plastic saved a $100 to add back to margins, all else being equal.
In order to break through in China Apple would have had to priced this mid tier. Remember that in China the product is going to cost more and that there is no option to put the cost of the device into the contract. They have to pay for it up front. And, people tend to have less money in China than the US.
Will it sell in China? Yes. Will it sell well? Yes. Will it have a breakthrough? No. It will be a niche product.
Corrections: there are contract subsidies in China as well. For example with China Unicom currently, if you buy an iPhone 5 with a 2 year contract (286 CNY monthly plan) you only pay 1099 CNY or $180 for the iPhone 5. If you upgrade to the 386 CNY monthly plan, than your iPhone 5 is free. China Telecom have similar contract subsidy programs for the iPhone currently as well, and when China Mobile start selling iPhones officially they'll have them too. I can't image why iPhone 5C and 5S will not have similar contract subsidy programs. iPhone 5C's off contract price is cheaper than current iPhone 5's off contract price in China, so my guess is with the 2 year contract at 286 CNY monthly plan iPhone 5C will around $100 China.
There should be a reason for change. Change for the sake of change is pointless.
Agreed! And change to simply satisfy idiot pundits and give them warm fuzzies would be even worse. Why do people keep trying to poke holes in the business model of the world's most profitable company?! It's almost as if the analysts think Apple is listening to them...
Comments
Right, China is the real target because the rest of the world is already fed up with AAPL! Asia is Apple's last gasp and only hope to not entirely go down the crapper. Samsung and Google have eaten AAPl's lunch -- past tense, game over! With Steve gone Apple has become a pathetic joke unable to protect its core IP and brand.
AAPL > $447 and free falling............................
How wrong, and annoying, can you possibly be? Clueless is the perfect descriptor.
In order to break through in China Apple would have had to priced this mid tier. Remember that in China the product is going to cost more and that there is no option to put the cost of the device into the contract. They have to pay for it up front. And, people tend to have less money in China than the US.
With all due respect, as to China, you have no clue what you are talking about. Consumers in China have one of the highest savings rates in the world, and will save for months to buy a luxury product, an iPhone included. It is now the second largest luxury goods market in the world, and is estimated to become the largest within just the next few years. As an expat living in China I know exactly what I am talking about. The number of Audis, BMWs, Mercedes, Porsches, etc. on the streets here is mind boggling! Even young working girls living at home will save for months to buy a real LV handbag. Further, the carriers are offering deals on the phones as well as payment plans so Apple will continue to do quite well here. And later this year, when the China Mobile deal finally launches, the market is going to explode. There are already 35 million iPhones on their network even thought they only work at 2G speeds as they are not compatible with their high speed network. With the new phones now able to work on their new LTE network sales are going to explode among their 700 MILLION customers.
I see you spiraling more and more out of control on this. You are not basing your opinion, ok judgment, about the price on the factors we plainly have to work with. I've mentioned them before, maybe to you, but I don't see any sign that you agree with the logic.
One more time. The 5 would normally be sold unchanged for the same price as the 5C this time around for the same as they've priced the 5C. But the 5C has some expensive changes that you are not taking into account: the radios, the front camera, an elaborate new manufacturing process for the case that has to be paid for, and twelve or eighteen new variations that have to be rationalized in supply, production and inventory, etc.
You want them to just give all this away and cut into their margins? You want to assume that you know their costs and pricing strategies better than they do? Please at least acknowledge these issues if you want to be taken seriously here.
Same with this post, which reeks of Internet armchair bean counting. They are not increasing margins with the 5C, they are maintaining margins. They would be pilloried for exploiting the advantage that plastic supposedly gives them. In fact, the advantages of using plastic won't be felt for several months or a year, or more. (That's a reasoned conclusion. I can't cite any hard data yet.)
the amount of analyst/pundit stupidity about the 5c and 5s may be at an all time high this time. and that is saying something!
the 5c of course is just last year's iPhone 5 with a modest spec bump and new fun plastic colors. which means an even better iPhone than before for $100 less (or even less than that where discounted). and next year it will replace the 4s, still on sale now, at its $-0- plus contract price point - but the stupidheads just can't wait that long i guess.
with this three-model price tiering Apple of course is protecting is overall profit margins instead of joining the android race to the profits bottom. why the stupidheads think selling iPhones at low margins is smart i really can't guess. i suppose they claim it is needed for "market share," because ... well, just because, you know? bragging rights are all that matters!
what Apple really IS doing about market expansion this year is finally getting deals in place with the #1 telcos in both Japan and China, two huge markets. the DoCoMo deal is done and look at what is happening!
http://blogs.wsj.com/digits/2013/09/15/docomos-move-to-carry-iphone-triggers-price-war-in-japan/
the China Mobile deal may also be done, but can't start until CM's 4G network is ready - soon. and if the following report is true, there are already 10's of millions of unlocked/jailbroken iPhones running on its old 2G network now:
http://bgr.com/2013/09/16/china-mobile-iphone-42-million-users/
now today we are hearing the stupidheads whining about Apple's not releasing first weekend 5c pre-order totals, concluding therefore that must mean sales were poor. instead of the obvious necessity to simply wait a week until both the 5s and 5c are both available for sale/preorder next weekend to have a real idea about overall initial demand. but the stupidheads just can't wait that long either i guess.
finally we have stock market "investors" short-selling speculators being cited as a key indicator for both iPhones' prospects. the stupidheads haven't yet grasped that Apple stock is clearly being gamed by the professional traders, cynically using rumors as their market-moving tools. those speculators might even include a few of the stupidheads who are actually just pretending to be that stupid on purpose. very few of these web pundits ever disclose their investments, as real journalists are expected to do ...
... according to a new report out from UBS that says Cupertino may have earned the benefit of the doubt.
That is the understatement of the year.
Your argument has no supporting statements (so to call it an argument is a misnomer). Back up your claims otherwise your "point" is moot.
Please back up your comment with supporting statements or don't comment at all. Otherwise it's basically name calling and that's the realm of children (then again I don't know that you're not an eight year old).
Thanks for engaging this question. We don't know, as you suggest, but we can reason.
The highest margin would have resulted from just selling the unchanged 5 for another year as the mid-tier $100/$550 phone. But that does nothing for China Mobile, and nothing for the "newness" and young hipster factor, including for Asia, because the iPhone 5 is a work of art, not fun. And the 5 is not durable.
So they redid the phone with new radios, camera, and battery, and invested in new machines and production capability to make that plastic case, which everybody thought, me included, was going to be a simple injection-molded snap-in affair.
Looking at it this way, all the savings they gain from not doing an aluminum back with glass inserts is used up by the changes they had to invest to transform the 5 into a world fun/fashion phone, done well in the usual Ive manner. So until the new plastic production costs are paid down, they might even be taking a cut on their margins for this new phone.
I think many are assuming the plastic back is already cheap to make. It doesn't look like that to me at all.
No you're not the only one, in fact you're probably with the majority. But you're appealing to the least knowledgeable "authority" possible, the Market.
As far as people choosing Moto or Lumia, they may have to do something like that because the 5C will probably be in short supply for awhile. If not, if they go to the Dark Side only to save a hundred dollars, well, they will get what they paid for.
If the 5 would be sold, it would be $100 less than the year before. I doubt going to plastic saved a $100 to add back to margins, all else being equal.
Now SHUT UP. All of that ilk. How is this pricing so difficult to comprehend?
In order to break through in China Apple would have had to priced this mid tier. Remember that in China the product is going to cost more and that there is no option to put the cost of the device into the contract. They have to pay for it up front. And, people tend to have less money in China than the US.
Corrections: there are contract subsidies in China as well. For example with China Unicom currently, if you buy an iPhone 5 with a 2 year contract (286 CNY monthly plan) you only pay 1099 CNY or $180 for the iPhone 5. If you upgrade to the 386 CNY monthly plan, than your iPhone 5 is free. China Telecom have similar contract subsidy programs for the iPhone currently as well, and when China Mobile start selling iPhones officially they'll have them too. I can't image why iPhone 5C and 5S will not have similar contract subsidy programs. iPhone 5C's off contract price is cheaper than current iPhone 5's off contract price in China, so my guess is with the 2 year contract at 286 CNY monthly plan iPhone 5C will around $100 China.
Now SHUT UP. All of that ilk. How is this pricing so difficult to comprehend?
So nothing should ever change at Apple?
There should be a reason for change. Change for the sake of change is pointless.
There should be a reason for change. Change for the sake of change is pointless.
Your comment probably makes sense to you.
Agreed! And change to simply satisfy idiot pundits and give them warm fuzzies would be even worse. Why do people keep trying to poke holes in the business model of the world's most profitable company?! It's almost as if the analysts think Apple is listening to them...