well, not so aggressively in Europe with 489€ price tag
not Apple's fault your currency sucks
if they used current exchange rate it would cost 356 without VAT, 427€ with VAT. 62€ is just bigger Apple margin
Except that it is foolish and extremely short sighted to base your price on only a single currency dataset. Currency fluctuations are constant, it makes a lot more sense to set a price that will work for the long haul then adjust the price of an item hundreds of times a day/week/year
if they used current exchange rate it would cost 356 without VAT, 427€ with VAT. 62€ is just bigger Apple margin
Except that it is foolish and extremely short sighted to base your price on only a single currency dataset. Currency fluctuations are constant, it makes a lot more sense to set a price that will work for the long haul then adjust the price of an item hundreds of times a day/week/year
yea, the problem is, that exchange rate fluctuates between 1,05-1,17, but their price is set like it is 0,97. That's not even in the ballpark, average is absolutely far from that
Entry price in India is over $500. I'm not convinced this is a phone for emerging markets.
Did Apple mention India in the keynote? I must have missed it if they did. I was watching the Twit.tv stream with Leo and others talking on top of it.
But two things:
1. Wouldn't this be the cheapest brand-new iPhone ever sold in India? That's gotta count for something. 2. With 1.2 billion people in India... surely some of them can afford a $500 iPhone.
I read an article from a couple months ago that said Apple sold the most iPhones ever in India last quarter. And that was before the cheaper iPhone SE.
Until last month Apple was selling the 4s and 5c in India. Before the SE came out, I was thinking that they would continue to sell the 5s, but since it looks identical to the SE (except for the Rose gold model), it's unlikely that they will continue to sell the 5s. Clearly Apple does not want to sell any new phones without Pay.
But, there's a chance that when the iPhone 7 comes out, that the SE could drop another $50 in price to $350, making it the most affordable iPhone ever. And by the 7s, it could drop down as low as $249, and either way it still likely has another year left in it with those specs ... at least in emerging markets.
Your article provides good original insights... Wall Street analysts generally are always behaving like copycats with very little or no original content and are completely clueless about what it takes to pack so many advanced technologies into a $399 handheld which can be affordable for the hundreds of millions if not billions in the emerging economies and, in particular, what Apple is all about.... with her stock rating at hold with $105 PT? All because Apple cut prices on iPhone and iPad etc.
Media does need to understand that Apple will not compromise their quality in innovation and the ***Margins***
Why?
Because they dont have to!
Watch Apple tap into a brand new market segment of sub-$399 smartphone.
So many are waiting in the BRIC markets!
Also all those who love adv 4" iPhone!,
Please read on!!
IOS- MacOS-TvOO-WatchOS combination outdoes Android and Windows combined!
Here is a good assessment why this makes sense!!!
I think Apple excels more so than Microsoft against Alphbet overall because of the way Apple approaches innovative use of advanced technologies and massive capacity to command customer loyalty.
It will do the same in the enterprise and B2B markets.
Here is what some said that is very profound. Read carefully.
You and the typical Wall Street media are clueless as to what Apple is up to?
You are underestimating services that are feasible as a result of Apple's "Integrated System/apps/hardware/s... approach its portfolio of offers.
Apple has IoT, Smartphones, Tablets and iCloud all very effectively covered like NO other company including so called FANGs. ( Perhaps with the exception of Microsoft)
Take a fresh look at this weeks announcements.
The Apple Headline should read: Classic Textbook Strategy -- A Masterful Stroke by Apple!!!
"Leverage High End to Dominate Low End"
Apple Determined to Dominate Sub-$399 Smartphone Market without Compromizing Margins!!
How? Apple reuses the massive investment it made in iPhone 6 and 6S past few years!!
Watch out Xiaomi, HTC, ZTE, SammySung, LowlyG and whoever.
I am very impressed.
Cant wait to find on March 24 what the prorder stats are?Fasten your seat belts.
*****iPhone SE should have been called iPhone SJobs
It seems to me there are going to be many analysts claiming the aggressively priced iPhone will destroy Apple's profit margins and cut into higher-end iPhone sales. In other words, Apple can't possibly win and that also goes for Apple shareholders. It's really a double-edge sword for anything Apple tries to accomplish. If this were any other company offering a lower priced smartphone, Wall Street would be on its knees praising the company to the heavens for trying to increase market share.
With Apple it will be seen as some desperation move that isn't going to help the company at all. Tim Cook will be said to have no more ideas left and a rehashed iPhone is all he can come up with. Wall Street isn't going to give Apple any credit for anything. It's all going to be about Alphabet, Amazon, Netflix, Facebook and Microsoft as the leaders of tech. Apple's share price is going to stay mired close to $105 all year long because Wall Street will claim there's no spectacular product to move it
****+ Wall Street analysts generally are always behaving like copycats with very little or no original content and are completely clueless about what it takes to pack so many advanced technologies into a $399 handheld which can be affordable for the hundreds of millions if not billions in the emerging economies and, in particular, what Apple is all about.... with her stock rating at hold with $105 PT? All because Apple cut prices on iPhone and iPad etc.
Media does need to understand that Apple will not compromise their quality in innovation and the ***Margins***
Why?
Because they dont have to!
Watch Apple tap into a brand new market segment of sub-$399 smartphone.
So many are waiting in the BRIC markets!
Also all those who love adv 4" iPhone!,
Please read on!!
IOS- MacOS-TvOO-WatchOS combination outdoes Android and Windows combined!
Here is a good assessment why this makes sense!!!
I think Apple excels more so than Microsoft against Alphbet overall because of the way Apple approaches innovative use of advanced technologies and massive capacity to command customer loyalty.
It will do the same in the enterprise and B2B markets.
Here is what some said that is very profound. Read carefully.
You and the typical Wall Street media are clueless as to what Apple is up to?
You are underestimating services that are feasible as a result of Apple's "Integrated System/apps/hardware/s... approach its portfolio of offers.
Apple has IoT, Smartphones, Tablets and iCloud all very effectively covered like NO other company including so called FANGs. ( Perhaps with the exception of Microsoft)
Take a fresh look at this weeks announcements.
The Apple Headline should read: Classic Textbook Strategy -- A Masterful Stroke by Apple!!!
"Leverage High End to Dominate Low End"
Apple Determined to Dominate Sub-$399 Smartphone Market without Compromizing Margins!!
How? Apple reuses the massive investment it made in iPhone 6 and 6S past few years!!
Watch out Xiaomi, HTC, ZTE, SammySung, LowlyG and whoever.
I am very impressed.
Cant wait to find on March 24 what the prorder stats are?Fasten your seat belts.
*****iPhone SE should have been called iPhone SJobs
I have an old 5 and have been jonesing for the SE, but NOT at the price Apple wants in Japan (and the rest of the world it seems).
Here, BEFORE adding the government's 8% consumption tax, the base price is 52,800 yen or US$470 at today's rate. That's almost an 18% premium over the US price in tax-free states. Why does Apple ALWAYS think they can screw people outside the US with these premiums to the company's advantage? I understand stabilizing against ER fluctuations come into it, but non-US prices could be adjusted quarterly easily to reflect swings. This is even more relevant when Apple does not convert and repatriate its overseas profits so ER swings have little true meaning.
Next, add the 8% Japanese government tax and we're at over $500 for the SE, which passes my psychological price resistance barrier versus the Apple-touted $399 price. In fact, the true price to the Japanese consumer has moved from the $400 to $450 low range to the $500+ medium/high range.
So, what to do? I'll stick with my aging 5 until the 7 appears and then make a final decision on price vs size and features. And when I buy, it'll be in a US tax-free state, not Japan.
I'll see what the iP7 brings to the table before I make my decision, but I'm really considering going back to the 4" size. As much as I love my iP6+, I miss the portability that my iP5's 4" screen gave me. It's just easier for one-hand operation.
Too early to say just yet... but it's really nice that Apple came back to the 4" arena again. They never should have left. I believe it will be an exciting year for sales.
"To achieve the lower price point and presumably maintain its margins,
however, Apple did make some concessions. The chamfered edges on the
iPhone SE are matte, the Touch ID fingerprint sensor in the home button
is the slower first-generation hardware, and the handset lacks the
pressure sensitive 3D Touch technology found in the iPhone 6s series."
What a ludicrous statement! Why would Apple cannibalize their flagship 6s models by putting the advanced features into the smaller form factor at a $400 price? For that pricing I would have expected internals more along the line of the iPhone 6. This iPhone is going to sell amazingly well. There are a lot of 4/4s/5/5s owners that haven't upgraded because they didn't want to deal with a larger phone.
well, not so aggressively in Europe with 489€ price tag
Does the VAT account for the difference?
VAT and other taxes + the much higher cost of doing business in Europe due to the very heavy regulatory burden. Even products manufactured in Europe are usually cheaper to buy in the US than in the EU.
"To achieve the lower price point and presumably maintain its margins,
however, Apple did make some concessions. The chamfered edges on the
iPhone SE are matte, the Touch ID fingerprint sensor in the home button
is the slower first-generation hardware, and the handset lacks the
pressure sensitive 3D Touch technology found in the iPhone 6s series."
What a ludicrous statement! Why would Apple cannibalize their flagship 6s models by putting the advanced features into the smaller form factor at a $400 price? For that pricing I would have expected internals more along the line of the iPhone 6. This iPhone is going to sell amazingly well. There are a lot of 4/4s/5/5s owners that haven't upgraded because they didn't want to deal with a larger phone.
Not really sure how the addition of any of those features would cannibalize the flagship phones. I'm not sure how they could fit the hardware for the 3D Touch into the 5s with everything else they had to squeeze in, but that said, I can't really see anybody giving up a 4.7" or 5.5" screen in order to get 3D Touch, or a faster Touch ID. Realistically, if I were in the market for a 4.7" phone and found out that Apple was selling almost the exact same specs in the SE, basically charging me a $250 premium for a .7" larger screen and 3D Touch, I'd be a little upset.
Apple sold 30 million iPhone 5S models in 2015 and they think they'll only move 17 million this year? With the upgrades the SE has internally? Seriously?
I think it should be 17M more than 30M of 2015; it would make more sense.
Entry price in India is over $500. I'm not convinced this is a phone for emerging markets.
There are 400M people in the middle class in India, this phone is for this market. It is obvious Apple is about to make a major push in the India market in next few years, even opening flagship stores. The 900M that remain are obviously not going to buy this phone, just like most Android buyers are in the lower demos of US society. India is likely passing China's pop in 2018.
"To achieve the lower price point and presumably maintain its margins,
however, Apple did make some concessions. The chamfered edges on the
iPhone SE are matte, the Touch ID fingerprint sensor in the home button
is the slower first-generation hardware, and the handset lacks the
pressure sensitive 3D Touch technology found in the iPhone 6s series."
What a ludicrous statement! Why would Apple cannibalize their flagship 6s models by putting the advanced features into the smaller form factor at a $400 price? For that pricing I would have expected internals more along the line of the iPhone 6. This iPhone is going to sell amazingly well. There are a lot of 4/4s/5/5s owners that haven't upgraded because they didn't want to deal with a larger phone.
Exactly. But I think my iPad Pro 12.9" has the old Touch ID sensor. While my 6s Touch ID is instantaneous, the iPad sensor is not nearly as responsive as the 6s. Anyone else noticed this?
well, not so aggressively in Europe with 489€ price tag
Does the VAT account for the difference?
Nope, the VAT is on average 20%, the difference between European price and the US price at current exchange rate is around 40 %. So Apple decided to make the iPhone 5SE 20% more expensive in Europe. Strangely enough for the 64GB version the difference is much smaller
if they used current exchange rate it would cost 356 without VAT, 427€ with VAT. 62€ is just bigger Apple margin
Except that it is foolish and extremely short sighted to base your price on only a single currency dataset. Currency fluctuations are constant, it makes a lot more sense to set a price that will work for the long haul then adjust the price of an item hundreds of times a day/week/year
Indeed, but the Euro/USD exchange rate did not move much the last 12 months, it has between constantly between 1.05 and 1.15. So setting the price 20% more expensive in Europe after incorporating the VAT, seems excessive.
iPhone 5s is still very capable device compare to number of Androids. And it is my next upgrade plan, used of course. I would never buy new one.
Lot of people prefer or is ok with 4" screen not only because of price.
iPhone 5s still powerful but Apple is ditching A7 processor, only iPad mini 2 has it now. even still powerful its age is not good from marketing point of view lacks ApplePay so can not generate royalties
iPhone SE iPhone sale is slowing so Apple is changing strategy to keep profit and attract new buyers and it is pushing more into services (ApplePay ...) it pays for lower iPhone price A9 ensures Apple have super processor in high volume/good price for several years compare A7/8. the same fits to camera
And for example here will iPhone SE cost 530-540 USD. It looks like Apple sells iPhone to our wholesalers at 399 as to customers in US. 399 + 84 VAT and cca 10% profit.
i originally wrote this comment on the global iPhone opportunity here on AI about three years ago, when Apple had about 270 carriers (I've updated it to reflect that they now have some 350), but the story remains intact, and the iPhone SE might be the catalyst to cause lift-off and true worldwide parity with Samsung in terms of markets covered...
"With Samsung selling it's wide range of phones through about 800 carriers worldwide, it's understandable to consider that Samsung has reached market saturation. However, Apple sells its premium-only iPhones through only about 350 carriers worldwide. Therefore, there exist many markets where an iPhone is not available or is beyond most consumer's budget. These people haven't been offered an iPhone as an alternative to the Android or Blackberry or Nokia phones offered by their carrier. As more people rise into the middle-class, Apple can likely expand to 100-150 more carriers that sell into markets where the luxury of an iPhone is a viable option within consumer's budgets. Samsung has already taken its swing at these markets without the iPhone as a competitor. As Apple enters these markets, Samsung will inevitably lose market share to Apple in both new customer acquisition and in upgrade/replacement of existing handsets. Thus, Samsung has not only reached saturation, but will soon face its toughest competitor in a subset of its markets where that competitor did not previously play. On the other hand, Apple, by entering new markets, still sees plenty of market expansion in its future (ie, Apple has not yet reached market saturation)."
Comments
But, there's a chance that when the iPhone 7 comes out, that the SE could drop another $50 in price to $350, making it the most affordable iPhone ever. And by the 7s, it could drop down as low as $249, and either way it still likely has another year left in it with those specs ... at least in emerging markets.
Wall Street analysts generally are always behaving like copycats with very little or no original content and are completely clueless about what it takes to pack so many advanced technologies into a $399 handheld which can be affordable for the hundreds of millions if not billions in the emerging economies and, in particular, what Apple is all about.... with her stock rating at hold with $105 PT? All because Apple cut prices on iPhone and iPad etc.
What a ludicrous statement! Why would Apple cannibalize their flagship 6s models by putting the advanced features into the smaller form factor at a $400 price? For that pricing I would have expected internals more along the line of the iPhone 6. This iPhone is going to sell amazingly well. There are a lot of 4/4s/5/5s owners that haven't upgraded because they didn't want to deal with a larger phone.
It is obvious Apple is about to make a major push in the India market in next few years, even opening flagship stores.
The 900M that remain are obviously not going to buy this phone, just like most Android buyers are in the lower demos of US society.
India is likely passing China's pop in 2018.
Lot of people prefer or is ok with 4" screen not only because of price.
iPhone 5s
still powerful but Apple is ditching A7 processor, only iPad mini 2 has it now.
even still powerful its age is not good from marketing point of view
lacks ApplePay so can not generate royalties
iPhone SE
iPhone sale is slowing so Apple is changing strategy to keep profit and attract new buyers
and it is pushing more into services (ApplePay ...) it pays for lower iPhone price
A9 ensures Apple have super processor in high volume/good price for several years compare A7/8.
the same fits to camera
And for example here will iPhone SE cost 530-540 USD. It looks like Apple sells iPhone to our wholesalers at 399 as to customers in US. 399 + 84 VAT and cca 10% profit.