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wow, i bought my iPhone on Aug 20...could have returned it Sept 3rd and bought the same exact model for $200 less. Not too thrilled about that.

But I am still impressed with the iPod lineup now.

MW: believe...as in I believe I have been taken to the cleaners.

Well MDN, I for one think too that this is not such a smart move by Steve-o. It pisses of a lot of . It's too much too soon. Why the haste in bringing.
They will loose a lot of good will from possible partners e.g. mobile carriers in Europe who are still negotiating, not too mention AT&T;.

all the people who want to buy into this report can as far as i am concerned....

...i need the price to drop a bit more so i can make my 5th big stock buy at apple.

Gotta hand it to the media in finding a negative spin on anything and everything, even when there's good news to be had.

The world would be a much happier place without such pricks.

The funny thing is if people buy the new iPod instead of the iPhone, who cares? It's all $$$ to Apple!!

Can't wait for the quarterly results.

"The move will add more evidence to the speculation that the iPhone, while causing quite a buzz, may not be selling as rapidly as some optimists had expected," Moritz reports.

I'd hardly call this "evidence" - as MDN notes, it's speculation, not fact. Evidence would be, say, a memo from Apple lamenting poor iPhone sales. This is simply more fodder for the rumor mill.

Soon there will be a 16GB iPhone at $499 and then the morons will realize it was only a $100 price drop in the high-end. Of course, this could have been avoided if the 16GB was released today.

Actually the really interesting news is that the iPhone is now being classifed as an iPod on the main Apple webpage.

(Guess it's to catch the buzz, rather than iPod & iPhone)

That should read "Why the haste in bringing a touch screen iPod?" I don't understand it, it's been on sale just 10 weeks! This kinda takes the shine of the iPhone. Also it will cut margins bigtime, hence the reaction on Wall Street.
BTW did I mention I had a qeasy feeling already yesterday and sold all my Apple stock. Will buy back in soon after this drop!

Wall St: (noun) group of shameless manipulators profiting by gambling illogically on other people's intellectual property and wealth.

MW: 'nature,' as in __ of the beast

MDN Magic Word: lack
There is a lack of iPhones in the Europe!
Sell! Sell! Sell! AAPL as much you can! We will Buy! Buy! Buy! ALL of them!

NANO is hot.

Price drop on the iPhone is a MARKETING strategy that has always worked... it will MAKE people buy iPhone rather than new iPodTouch. GREAT move as products very similar... same Apple genius as with close iMac line-up when comparing models to others.

Drop in stock is common thing on most new products or adjustments.

Wait and see.

Whether apple releases a $499 iphone or not, the price drop is still $200. Ask those who got the phone a couple of weeks ago. (those who can't even return)

I predicted that the shares would drop 4 bucks yesterday (as it ALWAYS doed no matter what stupid reason they give for it) . It went down 6...oh well reasonably close.

Supply and Demand 101 Folks. Supply is exceeding demand so lower the price by $200. No magic here. Apple clearly can't shift iPhones at their previous price point. Overpriced.

Apple originally stated a goal of selling 10 million iPhones by the end of 2008. They then stated a goal of selling 1 million iPhones by the end of 2007. In a press release made available today, Apple has announced that they are on track to sell 1 million iPhones by the end of September.

And yet the Street insists that the iPhone has disappointing sales. Madness.

Why the hell would they take the volume switch off the side when they took the cell phone chip out? I Love the volume switch I hate having to touch the screen for the volume..

I'm one of the early adopters, and although the price drop stings, it's not totally unexpected. It was bigger and sooner than most of us thought, but it was inevitable. I still love my iPhone. But it would be nice if Apple rewarded us early adopters with something... perhaps a new nano in the mail.

Apple will soon intro the 3G iPhone-world with larger memory when it launches service in Europe in a month or two.

steve said theyll be selling there 1 millionth iphone this month, what were the expectations?

My initial thought was that they had to kill the low end iPhone to preserve flash storage supplies for the new iPod Touch, so they decided to streamline the iPhone line and reduce the price to continue their takeover of the Smartphone market and prevent supply chain issues with the new iPod Touch models

Once again, for the upteenth Apple announcement in a row,
"Buy on the sizzle, sell on the steak."
Apple stock always goes up pre-annoucement, down post-announcement, and trends moderately upward or downward over the next week or two as the quality of the announcement is more moderately assessed.

I believe Mr. Jobs is going for the kill the smartphone market and is ready for mega-holiday sales as contracts expire over the next four months. He's got anywhere from a six-month to two-year lead in technology on the phone and wants to be a major player in the non-commodity phone market too, to match the music market and the computer market.

I also believe that Apple stock has strong upward pull and stock manipulators twist the news (like this article) to drive the stock down, creating short-term buying and selling opportunities. Apple's secretive nature on news and announcements plays into this too.

Sorry MDN, but NO company drops the price on anything by 1/3 if it's selling at or beyond expectations. The market would demand the price to stay the same. The unit isn't selling as well as expected. It may be selling well by smartphone standards, but smartphones are still a small percentage of the cell phone business.

This price drop was to save face, as Apple desperately needs to sell 1 million by the end of this month to meet that expectation. So the need to drop the price must have been great for Steve and Apple to do this, as this will not make for great press in the next few days.

The iPods will be overshadowed in the press by this price drop. Crazy stuff.

OK, Apple you suck! Common I bought 2 iPhones on Saturday and now just a couple of days later a 200 price drop. Its huge and needed but why drop the price after just 2 months on the market? Don't get me wrong I am all for the price drop but screwing your loyal customers that forked out big bucks like that is just wrong. Guess steve jobs really thinks the customer can go F themselves what does he care that self righteous jerk off. I am not buying one more apple anything. F-off Jobs! Also, MDN your a real kiss up.

I for one am pissed about the price drop... I could have gotten an 8gb model for 33% less, or 20% less than my 4gb cost on 6/29. And now that it looks like a 16gb model is coming soon.... for the same price!

well the price drop puts iPhone squarely in range for me and my two sons. Still needs iChat though...frustrated that this is still not in there.

...Oppenheimer say that margins would be less this quarter due to price inventory squeezing or some such something or other? Hence, this price drop isn't reactionary but rather planned from the get-go.

The iPod Touch sales will eclipse iPhone sales and we'll hear as much come January 14th.

Look like Apple has become the favorite company for this fscking Wall Street ritual.

*Apple debuts something great (great new iPods, minor price drop on popular iPhone product right before Xmas) - stock must be sold.

*Apple debuts something >meh< (AppleTV) or reports some truly troubling news (Steve's stock back-dating issues) - stock must be bought/cheered for/protected.

* Wash, rinse, repeat.

On the face of it, it would be easy to say that these institutional brokers and analysts are simply acting stupid. It's very satisfying to think the powerful are really idiots, and for the most part they are no smarter or dumber than any of the unwashed. However, while they are no better than the Average Joe/Jane in any way that matters (despite what they convince themselves), people who do 'change money' for a living do have access to better means.

In other words, the truth here is that they are doing what their positions allow - nothing less than short term market manipulation. They have broad media access (you don't), and they use it to sow enough FUD when the great stuff happens. Then, when the stock dips for a few hour/s or days, they swoop in and buy - making a killing. On the flip side, when shit is rolling down from Apple's hill, they claim 'healthy flowers' for the masses, sell off slowly, and thus minimize their losses. When you consider the volumes that they buy & sell stock (i.e. massive), even small movements in price equate to big effects. So they create those movements for their own benefit.

Unfortunately, their are people who get wacked by these tactics - typically, the ones who have a lot in the market but aren't too sophisticated about how it works 'unofficially'. Buyer beware.

Too many Wall Street pundits are Beatles fans.

Reality Check needs a .... well let's say pause for thought. Sales are beating expectations so much that unit cost is down, and flash is down too in the next few months as more new plants come on line than there is demand for the product.

The price drop was due to timing to some extent, sometime before the year end was on the cards, this early enables more people to plan for their holiday wish list.

Well, nobody would have minded a $100 price drop, but a 33% / $200 drop is really something. Anyway, the one that really has to swallow is the competition. How can Palm, RIM etc. compete with this price?

The share drop is because of profit taking following the run up to the announcement today. Nothing more. This happens every time Apple has an event and announces new products. The bigger the product announcement, the bigger the drop in stock price. The price will recover over the next 3-5 days.

None too happy about the iPhone price drop. I feel a little taken, although I'm still glad I have had an iPhone to use for the past 1 1/2 months.

No "shine" is off of Apple's iPhone or other products. If anything, Apple is showing a response to the market by removing the slower selling 4GB model and being aggressive with the pricing.

Finally, anyone who wasn't expecting a touch screen iPod to be introduced soon was living in a cocoon. Anyone who thought the touch screen iPod would have 80GB flash drives was living in a dream world. Apple did the best of both worlds here – more iPod choices (at least temporarily), allowing you to choose the iPod which best fits your needs. The technology simply isn't there yet to have an 80GB touch screen iPod and have it be affordable. The iPod classic is the bridge until large capacity, inexpensive flash memory is available.

Makes you feel bad for the poor schlubs who bought the iPhone recently.

Wait a minute... I'm one of them. Damn you Apple. Where's my $200?!

You guys are nuts -- this is good news. Apple sold the iPhone at a $200 premium to collect extra cash from suckers..err.. early adopters. They *planned* to collect that $200 premium only from the early adopters, who have, by now, purchased whatever they were going to purchase. So now, as *expected* and planned, they are drop the price down to normal levels for more typical consumers. This is a *smart* move.

Remember, every extra phone that sells also scores them an *extra* $200 from AT&T;, which exactly offsets the lost revenue from cutting the price since these are phones that wouldn't have sold otherwise.

Iphones are selling EXACTLY as expected, since this move was planned all along.

~Thisson (Yo ho ho!)

zachcube - easy turbo, you can return them. it's within the 14 days. maybe they have a grace period as well that will allow it? ask before ranting! no one knew this was going to happpen. if you hadn't bought the phones you wouldn't care. it just happens to be your luck right now, it's no one person's fault.

haha, MDN - 'ask', just ask them about it!

Maybe they should turn about, and up the price by $200 quickly, so all the angry owners will be happy again?

It amazes me how, with all of us here real fans of Apple and supposedly familiar with how great this company is, nobody is aware that Apple (much like other really really good retailers) has price protection policy! I believe it is actually printed on the back of your receipt.

According to Apple's policy, you bring your iPhone and your receipt to any Apple store and they give you $200 back. In practice, this is most often even more generous. I have heard of many cases where the refund was given when a price change happend more than a month since the purchase (new iMac announcement - $300 price difference, 5 weeks after purchase).

It is obvious why Apple can afford to do it. When even Apple's devoted fans don't know about this, who else is ever going to take advantage of it? Of course, when you do try it and they do it for you, their image shoots through the roof.

@ MP: Judging from the comments here, yes, Apple should do an about face and change the price back immediately!

To these whiners: a big WHATEVER!

I paid $599 for my iPhone, and not for one second do I regret it. Do I wish I had that $200 back? Sure, but I'm not pissed. Not even disappointed. Besides, if I'm pissed about this price drop, I should be about every other company's price drop that came after I bought something. And I'm not. People, this is life. Deal.

You might be able to get some cash/credit back. Don't complain, THINK

I didn't see Microsoft cutting the Xbox's price by 33% after only 68 days on the market. Nor did I see Sony doing that with the PS3. Hell, I've never seen ANY company do this before. The early adopters have every right to be pissed off.

Apple should do the right thing and offer a $200 mail-in rebate to everyone that purchased an iPhone between 6/29-9/4.

UH Hello! I called ATT and they said they would not take the phones back. WTF, F'n apple crap. Suck it jobs.

magic word : "price"

It does seem a bit crappy for Apple to cut the price by $200. I'm one of those early adopters, and I adore my phone. It's a fantastic device. However ... to cut the price after only 2 months on the exact same phone is a bit too much too early. Usually price drops come with a product-line upgrade. I half expected, when the 4 GB unit vanished, that they were going to cut the 8 GB unit back to the $499 level and introduce a 16 GB unit for $599. THIS would not have made me angry ... it would have made sense. But, no, they're just cutting the price and chopping out the low-end. And I ... who bought his iPhone 2 moths ago, have the realization that I paid $100 per month for being an early adopter.

Author doesn't know the difference between a gigabit and a gigabyte.

There's no crying in baseball. When WE bought our phones, we paid a price which we thought was fair, otherwise we wouldn't have made the purchase. Just because Apple decided to lower the price today, shouldn't change our attitude about the deal that WE were willing to buy into.

I guess if you fill up your gas tank today at the pump and Mobil, Exxon, or HESS decide to cut the price of gas tomorrow, you're all going to expect some form of compensation? I didn't think so.

If you bought an iPhone in the last two weeks, call apple customer care, they will refund the difference between the old price and the new. Google "apple price protection".

You're welcome bitches.

The number of new customers drawn in by the lowered iPhone prices will easily dwarf the number of early adopters who will complain about the price reduction.

There is a small risk that new customers may hold off purchases in anticipation of even further price reductions. However, the onset of holiday shopping season will mitigate that risk and probably overwhelm it.

If you are looking to enter AAPL, you may want to start scaling in now. Or you can wait closer towards the end of September or early October.

Reason: September is typically the worst performing month for stocks. New money typically comes into the market in October (although October is also a favorite month for stock market crashes also).

As for AAPL specifically, the next major catalysts will be the quarterly earnings release, scheduled for after market close on October 18th, and the release of Leopard that same month.

Apple looks to the future. The one million (or so) people who already bought an iPhone is nothing compared to 20 million who will buy iPhones worldwide by the end of 2008. Apple is not going adjust a smart business decision to make early adopters happier about their past purchases. And you know Apple is still making 25% (or more) margin at $399, not including the revenue from AT&T;.

Bummer to those idiots who bought the overpriced toy called the iphone last week.

Name givenbt Apple to those that buy their crap first -- sucker!

Silly Hobbits. Don't be hasty.

Wait people!

The same thing happened with Aperture.
I got $200 electronic store credit from Apple after price drop.

Maybe you are bashing them too soon.
Maybe they will issue a credit, then you will think:
"what a heck, I add another $150 and get an iPod Touch"
That's a great strategy to do more sales.