“I’ve been wrong about the Mac maker just as much as I’ve been right. In October, for example, I sold my long-term options position because a backdating scandal added an unacceptable amount of risk,” Tim Beyers writes for The Motley Fool. “I was sitting on a 150% gain at the time. Had I held till today, I’d be sitting on a four-bagger. Nice work, Tim.”
“But enough with the sob stories. My point here is that Apple has made a habit of defying conventional wisdom in a way that’s made a lot of people rich,” Beyers writes.
Beyers writes, “[However,] History [also] shows us that no one has ever successfully sold a $600 phone… Trouble is, history isn’t perfectly informative here. Nokia, Motorola, and Palm have never had the benefit of retailers that catered to their products in the way that Apple’s retail stores will show off the iPhone.”
“We know the effect that can have. Macs are fun to play with. So are iPods. Apple’s retail stores — which account for roughly 18% of annual revenue — make playing with these gadgets really, really easy. They’ll do the same for the iPhone,” Beyers writes.
Beyers writes, “I’m not going to play the predictions game this time. I’ve been burned too many times. Better it is, I think, to leave the crow for someone else. Like, you know, the soothsayers who are now predicting that Apple can’t sell a $600 phone. Good luck with that.”
Full article here.
MacDailyNews Not-So-Minor-Note: Apple’s iPhone starts at US$499, not “$600,” which ought to further drive home Beyer’s point. Apple will sell boatloads of $499 — and, yes, even $599 — iPhone models.
Related articles:
Researchers: Apple iPhone may eclipse Windows Mobile market share by 2008 – May 02, 2007
Is Apple iPhone’s price too low? – May 02, 2007
Microsoft’s Ballmer: ‘No chance Apple iPhone is going to get any significant market share’ – April 30, 2007
Survey says: Apple iPhone ‘is going to be a monster’ – April 24, 2007
AT&T COO: Apple iPhone on target for June launch; over 1 million customers ready and waiting – April 19, 2007
Oh Tim, I can’t wait to plunk dow $600 plus whatever the bluetooth headset costs. Thought you should know.
This irritates me…why do all these journalists think the price is going to remain at what it was announced? I think there’s little doubt that the price will come down and quite possible a LOT, even in a relative short period of time. Hence, publishing stories based on concern about the “high” price is dumb.
P.S. I held my APPL. I guess I’m smarter than the investment experts.
Motley Fool are two faced lying ass dogs. I mean it. One day they are all over Apple like the smart asses they are, now this cluess moron brags about how much money he lost.
I use to believe in MF. Even subscribed to their service. But they are fair weather friend tow faced lying dogs.
I say screw em.
Beyers removes the choice of buying the cheaper model by inflating the price by $101 to justify an attempt to say something, anything, about the iPhone after getting an assignment in his in-box from the Fools home office in a basement to write something, anything, about the iPhone.
Moron.
Mac Maker, Mac Maker,
Make me a Mac,
iPhone a phone,
Ballmer’s on crack.
Mac Maker, Mac Maker,
Look through your past
And make me a perfect Mac.
BTW, Tim, I should also mention that I did indeed buy the original 5GB iPod at $399 a week after it was released. It was awesome! I kinda remember a lot of hoo-haw about how it was soooooooo expensive and nobody would buy it. Well I guess we saw how that turned out. Was that one of your WRONG predictions about Apple?
Uncrunch me! I cannot read any of these postings without popping my eyes out and wiping them across the screen!!
APPL? or AAPL?
*—tiny type—*
MW: ‘wish’ (i could see it)
I told Tim not to sell, FTR.
This page looks beleaguered…..
MW:trying
TT,
Both of your posts totally cracked me up. I am probably not going to be an iPhone owner anytime soon, but I would love to get my hands on one for a little while. I guess I’ll have to settle for something else right now
” width=”19″ height=”19″ alt=”rolleyes” style=”border:0;” />
…for me to poop on!
Just a thought here. I think that most people are missing the point. They keep saying “phone”. Yep, I would not pay $500 for a cell phone. Sorry, I am not that rich. Hey, I just bought my first iPod. A first gen Nano 4 gig refurbished for 120 $. It works neat too. : -)
Anyway, I think the iPhone will have bluetooth. Add a bluetooth keyboard and mouse and you will have a mini computer — SUPER Ultralight that does everything or almost. And with third party upgrade parts, and as Apple expands its software, you will see it get more and more worth the money. JMHO.
” width=”19″ height=”19″ alt=”grin” style=”border:0;” />
en
“no one has ever successfully sold a $600 phone”
Weren’t these phones over $600 when they where introduced:
Motorola StarTac
Motorola Razr
Palm Treo
Just to name a few. The StarTac was over $900 when it came out and you could not find one.
Ha ha TowerTone.
I’m being advised to take profits on my appl stock. I replied that there is no way – I’m in for the long haul – right up until the whole world has recognised that Windows was one huge enormous mistake.
At which point there might be a downside to Apple, though unless there is a new Apple by then, I doubt even that.
It has to be said again.
It is called iPhone.
It is not a ‘very expensive cell phone’.
It is a ‘very cheap, hand held computer’ with a built in iPod, camera and cell phone. Once people realize this it will be an easy sell. Once the programs and games are available it will be an even easier sell.
If Apple had named it The Real Origami even the Windows fanbois would get it.
No one has ever successfully sold a $600 phone because no one has ever made a phone that was worth $600.
Till Apple came along.
” width=”19″ height=”19″ alt=”wink” style=”border:0;” />
COmpare it to the TREO line by Palm and the price is not that much different. Especially when you look at the features.
MDN: Please fix the type. I can’t even read these comments!
OK, I need some help from some marketing people. I understand some of the theory, but I’m not that I can communicate it.
One of the big mistake that is being made is that there is some kind of relationship between the cost of the item and it’s price. Motley fool and several others talked about the cost of materials etc. Irrelevant. For example, once Microsoft finishes making Windows or Vista there is virtually no cost to make unlimited copies (Please, no Microsoft bashing, this is just an example). Cost has nothing to do with pricing.
Price communicates value. Read that over a few times and think about it. Price communicates vaue. You can go into any supermarket and find a generic procuct that is selling for less than half the price of the brand product. But the brand product is outselling the generic by a wide margin.
Apple’s price is communicating the fact that it is a premium product. You can’t do this with just anything. But the iphone has signifigantly distinctive features to justify a premium. When something is a commodity (identical) you want to pay the lowest price you can find. When something is tremendously valued, you want to pay a premium price to get a premium product.
Example: Would you be comfortable having a heart surgeon perform triple bypass surgery for 29.95? Wouldn’t that make you a little quesy? We expect premium products to charge premium prices. If Apple lowerd the price of the iphone it would actually be doing itself a disservice. It would be communicating that the iphone is just like those “other” phones.
This is not an easy concept to understand (and even harder for me to try to explain). But business people with MBAs and such should know better.
There have been several surveys testing the price waters of the iPhone. Most show more interest in the $600 model, than they do the $500 model.
I’m modeling 3 $600 units for every 1 $500 unit.
Yes, I think the disparity will be that great.
Beyers writes, “I’m not going to play the predictions game this time. I’ve been burned too many times. Better it is, I think, to leave the crow for someone else. Like, you know, the soothsayers who are now predicting that Apple can’t sell a $600 phone. Good luck with that.”
HEY!!! they finally got one right
He should look back at the initial release prices of top-end “smartphones” from other manufacturers (outright purchase, not with a multi-year calling plan) from Nokia, (Sony) Eriksson, Psion, Handspring and others. There is plenty of precedent for this. I’m much more concerned about how quickly they can implement Turbo 3G than about the price, but that’s just because I live in an area (Stockholm) where that service is readily available. It wouldn’t make any sense to delay release in the US to include that feature.
“Example: Would you be comfortable having a heart surgeon perform triple bypass surgery for 29.95?”
Sure. On Osama Bin Laden. Anaesthesia is not an option. I’ll even pay for it now in full.
my balls are beleaguered.