Is iPhone price cut a mistake?
p2pnet news | Product News:- The iPhone hasn’t been receiving the wildly enthusiastic reception Apple had hoped for and yesterday, as well as announcing the iPod has been morphed, Steve Jobs also revealed a $200 price cut for the 8Gig iPhone.
A lot of the people who’d splashed out six hundred bucks only a few weeks ago are rightly extremely upset.
“I feel like I have been ripped off by Apple,” USA Today has Laura Carter of San Antonio declaring. “They should give all the early adopters a gift card of $200 to use in an Apple store.”
The 4Gig version is going the way of the DoDo, but Apple has come up with the iPod Touch, an iPhone without the phone, but with audio, video and Safari browser for Net access.
It’ll cost $300 (8 gigs) and $400 (16 gigs).
Meanwhile, Wired‘s Terrence Russell isn’t terribly impressed with the iPhone price cuts, giving four reasons why IHHO, it wasn’t a good idea.
1. Substituting A New Product Launch For Tact
Seeing the evolution of the iPod is great, but it’s not going to cause us to forget the $200 price difference.
2. Rushing The Timing
It’s clear that the company wants to get the iPod Touch into people’s hot little hands as soon as possible, but cannibalizing its own business so quickly makes the company seem both short sighted and sloppy.
3. Slashing A Little Too Much Off The Price
It’s no secret that electronics drop in price over time, but such a deep and hasty discount makes trying to quantify the realistic retail value of the hardware confusing. A mistake of this nature just encourages pricing paranoia.
And last, but by no means least
4. Showing Obvious Contempt For AT&T’s Role
Paired with how Apple has also announced the WiFi iTunes store and the introduction of its own ringtone platform, one can’t help but notice how AT&T and its customers seem to be getting the short end of the stick repeatedly.
Also See:
$200 price cut – Apple slices $200 off 8G iPhone, September 5, 2007
USA Today – Some early iPhone buyers irked; others have no regrets, September 5, 2007
Wired – Four Mistakes Apple Made With The iPhone Price Drop, September 6, 2007
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September 6th, 2007 at 12:35 pm
Somebody obviously bought an iPhone and it’s clouding their view. Point by point:
1. Stuff costs more up front and gets cheaper later. Live with it. ALL technology products are like that. I paid $300 each for two 40 MB hard drives. Yes ‘M”, nit ‘G’. I’m over it. You want sooner, you pay more.
2. Cannibalizing their own sales is an oxymoron. A company WANTS to “cannibalize” their own sales, it’s much better than having other companies do it first. There is no reason that they should care which of their products someone buys so long as it’s their products. Their iPod sales have been drooping and needed a boost.
3. See #1 above. Also one may recall that when the iPhone came out those who take things apart stated (and it was in the news channels) that the iPhone’s margins at Apple were particularly high, more than traditional for them. So it’s not so much a big discount now as much as being over-priced earlier trying to leverage the new touch UI.
4. How does AT&T or it’s customers get short changed? The iPhone had *NO* ringtone ability previous to this, how does adding it shortchange anybody? Especially AT&T’s customers? I’m an AT&T customer (but have a Moto phone where I can make and use my own MP3 ringtones for free), why am I short changed?
September 6th, 2007 at 12:36 pm
normally apple don’t lower prices when a model is released it is at a fixed price for life. this price is then only updated when the new version is released.
September 6th, 2007 at 1:03 pm
Oh those Macolytes. You got to love ‘em =)
September 6th, 2007 at 1:04 pm
I called and pleaded my case with AT&T customer service this morning, they promised to credit $200 to my next bill, let us see, I will believe it when I see the money. I have been a loyal AT&T customer for >2years, and bought an 8gb i”phoney” on July 12 at a local ATT store. Everybody is a winner if they can reimburse all early adopters
September 6th, 2007 at 1:27 pm
Yeh but why should AT&T pay for Apple’s mistakes?
September 6th, 2007 at 2:09 pm
Wired’s Terrence Russell’s points are gibberish. The first 2 months of iPhone sales was market research. The price cuts were inevitable, and they’re exactly what I predicted would be the bulk of the Sept 5 announcement, along with the 16 gig device. The iPhone was already way overpriced! If Apple wants their iphones or ipods to be a universal standard, as well it probably should be, the price must be affordable – even now it’s a bit high, especially the AT&T service plans, which are, IMHP, exorbitant. People who already pay $30-$40/month and more for residential net access shouldn’t have to pay that much again for less frequently used access. There needs to be a cap on how much an individual should pay for net access – the cost basis shouldn’t be “per device”.
September 6th, 2007 at 2:52 pm
Like I said, Oh those Macolytes. You got to love âem =)
September 6th, 2007 at 7:26 pm
When will people learn that it is common practice for Apple to either kill off an older model, or render it worthless with new products?
I still remember when they just about killed most of the local Computer stores across the US when they pulled the plug on the “new” Apple IIGS… A good friend of mine, and a computer shop owner who had just sold over 100 Apple II GSs to the local school system, ended up loosing his business with the school district when Apple announced that it was dumping the II series (If I remember correctly, it was only 6 months after the release of the IIGS).
Later, as time passed by, how many Mac systems have been rendered out-dated or over priced due to major changed in OSs and the switch over to Intel based systems?
Sure the timing is not the best (especially for the newer phone), but a non-phone iPhone was bound to come by sooner or later, and as for the upgrade in memory, it was bound to happen.
The over priced iPhone comming down? It happenes all of the time, get over it!
As an iPod user, I can say that I am just happey that they didn’t dump the entire iPod line and iStore Services, to purely support their new iPod series, and force every iPod user to buy a new iPod, just so that they don’t loose all of the music they bought from the iStore.
Just my two cents…
September 6th, 2007 at 11:45 pm
The price slash seems too early to me. Certainly a price cut would come, but after only 2 months? That’s a good way to alienate your customer base that paid the full price. Apple now is on the defensive regarding the price cut.
http://www.growyourfunds.com/2007/09/apple_aapl_put_on_the_defensiv_1.html
September 7th, 2007 at 2:33 pm
You want sooner, you pay more. Period. Get over it and get on with your miserable iFan life.