Apple hopes to boost sales with a cheaper iPhone
Although the Apple iPhone is a very cool new and technologically advanced invention, the price of the phone at the start is what some might call outrageous. The phone is completely jam-packed with capabilities but it sells for just as much as a person would pay, for a Playstation 3, or Nintendo Wii. So when a person thinks about buying such a thing costs, and benefits must be taken into consideration. Do you pay $ 399 for a iPhone, or the high end gaming system. Internet, talking and iPod capabilities that are portable, or a system with a blu-ray player and virtually all the capacity of the iPhone but stationary. In the increasingly mobile world that we live in today the iPhone might pay off for some people, but not me. Which is why Apple has decided to come out with a smaller gigabyte version of the iPhone with all of the same capabilities and a price of $199. For someone like me for instance now the judgment made at the margin might change because at that price you would not be able to afford a game system and the fact that the phone is now at a comparable price with other smart phones is definitely enticing. By lowering the price of the phone Apple has hopes to change the decisions that people are making at the margin.
2 comments:
The actual iPhone is the only low cost of the buyer's entire purchase. Since the price of the iPhone was lowered, Apple individually raised the voice and service plane by up to 15 dollars. The acual 2 year plan that the buyers sign up for costs them $40 more than the plan of the original iPod. So pretty much the only thing that is cheap of the entire iPhone purchase is the iPhone without all of the strings attatched, i.e. service plans, voice plans, etc.
Although I understand what Devin is eluding to. Apple did this because its market research teams have discovered that many people are buying the iphone and using it only as a mp3 player. Many people are not purchasing the plan with it. So his point is valid, there are more expenses. But apple is still making money hand over fist and people couldn't be happier about their products.
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