Apple’s Worst Kept Secret

10 06 2008

Is anyone surprised by Apple’s announcement of a second generation iPhone that’s faster and cheaper? Early adopters always get screwed by later launches, and even more so if the gadget in question is an Apple. The brand value that Apple products have mean that the first generation will usually be a must-have, and have the inflated pricetag that goes along with that.

On the price issue early adopters really can’t complain; it’s widely known that technology will decrease in price over time. However one gripe against Apple products that possibly is fair is that their first generation products are nearly always “behind the curve” technologically. Is this a ploy to make people have to fork out again?

The cynic in Mr President would say yes. In fact the announcement of the 3G iPhone was actually incredibly underwhelming, he felt. Everybody knew it would be 3G and the price drop was also not entirely unexpected. There’s little else there to get excited about, especially with products like the N96 boasting better specifications.

In fact if there was anything interesting about the launch it is that it appears to signal a shift in Apple’s strategy. Traditionally they’ve aimed at the high-end of the market, justifying the higher prices by talking about things like build quality. Yet their approach with the iPhone seems to be the opposite; it will be cheaper than RIM and Nokia’s offerings but technologically inferior to both. Has style finally met substance?

Could this begin a trend where Apple price their products more reasonably?



4 responses

10 06 2008

I don’t have a link handy Pres, but the story I heard was that Apple was way off of their projected sales target for the year so, the price was lowered in part because they accepted subsidies from the phone companies.

10 06 2008
Mr President

Yeah, I heard that rumour about subsidies myself. I think it’s true too.

Dropping prices this drastically is very un-Apple. Normally the main reason for a cheap Apple product is because they’ve brought out a newer one so all the fanboys end up selling their first gen to buy a second gen (or second gen to buy a third etc).

10 06 2008

Other factors too, price of gas and food, they’re feeling those. When I say they’re way off on projections, I’m hearing like, 55% or thereabouts, a great part of which they always expected to make up with the new iPhone but, probably some market research pointed out the unreality of that and they got cold feet.

11 06 2008
Mr President

To be honest I always thought Apple might have overreached by trying to enter the smartphone market. They simply lack the expertise of the likes of Nokia and RIM. The iPhone only appeals to Apple fans.

Having seen what happened when Sony became complacent in their dominance of portable music players, allowing Apple to sneak in with the iPod (and let’s face it, the rest is history), no major company will do the same again. RIM and Nokia will wipe the floor with the iPhone.

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