“The amazing Apple hype machine soon could help Sprint Nextel Corp. sell bunches of music-playing wireless phones,” Jason Gertzen reports for The Kansas City Star. “The debut of the much-heralded iPhone is thought to be imminent, though Apple and AT&T Inc. executives remain mum on the exact timing.”
“Apple, which is making the device, and AT&T, which is providing the wireless network for the iPhone, both are positioned to be the prime beneficiaries of the new high-tech product. But other companies, such as Verizon Wireless and Overland Park-based Sprint, also are likely to reap the rewards of new business as consumer attention increasingly turns to handheld portable stereos that also can make calls,” Gertzen reports.
Gertzen reports, “Apple and AT&T executives have substantial aspirations for iPhone sales. Jobs set a target of selling 10 million by the end of 2008. The iPhone will be sold through Apple and AT&T retail stores and online. ‘It is probably the most anticipated phone in living memory,’ said Roger Entner, a wireless industry maven who is a senior vice president with New York-based IAG Research.”
Gertzen reports, “The announced $500 and $600 prices of the iPhone have raised questions about whether it will appeal to a broad swath of consumers… Despite this factor, Entner said, the iPhone is likely to enjoy success. He also expects to see a ‘ruboff effect’ benefiting multiple companies offering music services.”
“’The Apple phone is being positioned as the Rolls-Royces or Ferraris of all phones,’ Entner said. Not everyone, of course, can afford such a pricey model,” Gertzen reports. “‘You go to the Ferrari dealership and ogle the Ferrari, but then you go buy a Pontiac,’ Entner said.”
Full article here.
Why is $500 – $600 so much in these people’s minds? Here in Oz, I bought a phone (Moto Z1) for $799 and then hooked up with whomever I wanted – on contract it was $450. And it isn’t even close to an iPhone. All I can say is that Apple is gonna sell a sh!tload of these things!!! And the rest of the market is going to sit back and just shake their heads – or hope that the <cough>Zune </cough>! will help them pick up the pieces!
Or if you are a girl you can order your watermellon Zune and hope it helps you meet Paris in the slammer! Why? Because you ought to be arrested for thinking that the Zune is in a class even near the iPod or iPhone!!!
MDN = girl (kind of a stretch to use that one in a sentence, that didn’t sound sexist!
“”The debut of the much-heralded iPhone is thought to be imminent, though Apple and AT&T Inc. executives remain mum on the exact timing.”
Say what? I though iPhone’s release date was 20 June 2007. Quick, call Engaget for an update!
These guys Just Don’t Get It. The number of people who see an iPhone and then buy something else will be the same folks who saw an iPod and bought a Zune instead. It’s not a Pontiac vs. Ferrari thing, as Pontiac makes some decent-to-cool cars (GTO = yum). It’s like a car versus a sandal.
It’s complete Microsoft generated FUD to say the iPhone is so expensive.
It’s the same price the Razr was when that launched for heavens sake.
I prefer to call iPhone the Aston Martin of phones – understated elegance that rocks!
The Ferarri – Pontiac analogy is just far off the mark.
A Ferarri is $200,00+, while a Pontiac is $20k – $25k. Smart phones are in the $199 range, and an iPhone is $499 or $599.
Considering the % of difference between a RR or Ferarri vs. a Pontiac are not even close to a smart phone vs. and iPhone, right there this lose analogy dies.
Secondly, consumers can easily justify a $499 device over a $199 device if it means eliminating multiple pocket gadgets, and doing more, and being ultra cool.
A consumer cannot justify $25k vs $225k, let alone get a qualifiying loan for such a purchase!!!
Simply put, $200 or so from a consumer perspective may equal value and desire, while a Ferarri over a Pontiac is simply fantacy.
iPhones will sell en-mass.
The points they’re all missing is the interace and the best of breed internet software. Lots of phones are phones and play music but virtually zero offer this level of sophistication and connectedness.
MDN MW: head as in the iPhone can go head to head with any of the others and win hands down!
OK, here’s the difference: nobody (excepting the very, very wealthy) has $100-200k to spend on a Ferrari. If they did (and assuming the Ferraris weren’t going to be in the shop every other week too), then lots of folks would buy them. The whole reason for the “sort of cool, mid priced sports car” market is purely price difference, which is substantial.
I know a $500 phone is expensive compared to something that you get for $50 with a 2 year service contract, but at least in wealthy countries, this difference is do-able for a big chunk of the population. I bought my original Treo 600 for $450, including a 2 year contract, and so did a lot of other folks out there.
What I’m getting at here is that the other phone companies’ talk of the “rub off effect” is completely bogus, especially given that media/smart phones cost at least $300 anyway. For the extra $2-300, people will pinch a few pennies if necessary and buy the iPhone. The only thing that can stand in the way is if iPhone supplies are very limited for a long period of time; then some people might get tired of waiting and purchase something else. If iPhone supplies are there, there will be _very_ little halo effect for other companies–quite the opposite, in fact!
That ripple effect will be on the order of magnitude of a tsunami. (Tidal wave to you Americans)
You see people, $500 is a GREAT deal of money for MOST people. As in THE VAST MAJORITY OF PEOPLE. Clearly the iPhone is not targeted toward these people. MOST people have the cheapest mobile phone they can get. They just want to be able to call home in an emergency, diall 911, or maybe, on a special Friday, splurge and order pizza out.
You folks who think $500 is cheap live in a fantasy world to these people.
The MDN magic word is problem. As in the problem with you people is that you’ve lost touch with reality.
There will be a rub off effect for the other “smart” “phone” makers, which is that the iPhone is not a phone, but will sell for what the high end phones do. It is more than a phone and in a class by itself, and is likely to be updated from its day 1 configuration by means of internet connection to Apple. AT&T will benefit, but what about Nokia, MOT, etc., not to mention RIM? There will be those selling them short.
So, RUB OFF= SELL SHORT.
I hope Apple pushes the “carry only one device” scenerio in their marketing schemes. The fact that you’ve got a phone, a web browser, and an iPod on your belt all in one helps justify the cost myth that Ballmer laughed about. I really hope Steve gets a call when on the stage with Mossberg and Gates. I expect Mossberg to have some interesting questions to stir the mix.
“Why is $500 – $600 so much in these people’s minds?”
Because this is a nation of “FREE WITH 2YR CONTRACT!!” You think people are out buying Samsung Blackjacks at full retail value? The only reason Microsoft has gained what little market share they have in the American smartphone sector is because of those things (Blackjack, Q, Dash) being $99 subsidized on 2yr contracts.
Don’t be mistaken, it’s not this version of the iPhone that will take the nation by storm in terms of market share. Like the iPod, it’s when the “iPhone nano” comes along for 1/3 the price that the fun really begins.
The only ripple effect the competition will be feeling is from the tsunami called iPhone crushing them to oblivion.
“The amazing Apple hype machine”
I would like to point out that Apple has put out the ONE commercial.
Hype machine? Fuck off… this product is incredible and slick, how about the idea that people are excited about it because it’s damn cool.
like BTSOF said …
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I’d rather have the GTO …
The first sign of a Tsunami is the water receeding, when the customers receed in great numbers, that will be the time for the other companies to worry and maybe “Run for them that thar hills!” When the tide comes back, i.e if the customer expectation is met and superceeded, then the tide will crash almost all before it. A number of mobile providers will find that they have to merge to survive either with other providers or even with Google or yahoo!!
Does the thought bear thinking?
iPhone is a bit overpriced, at least slash $100 off.
$299 or $379 for everything.
I think it should be a more universal product, to service providers that offer the same or similar offerings of Cingular
Sush as T-Mobile.
T-Mobile and Cingular are the top two.
Sprint/Nextel is abit more difficult because of the Walkie TALKIE DEAL. Plus their coverage sucks ( As a Previous Nextel User and Now happily using T-mobile.)
It would rise awarness of the iPhone, bring more business to apple, and benefit other Service providers.
To some people, everything is overpriced.
I’ve had a dozen, or so iPods, each seems to get cheaper.
Maybe it’s an acquired tolerance.
Well, people do spend up to $349 for a 80GB iPod without any subsidized 2-year contract. The iPhone will sell well for $500, no doubt.
Stop complaining about the iPhone price, I can tell you that a Nokia N95 costs 800 Euros without a mandatory contract (I just saw it at the shop).For the people that do not have dashboard to calculate the exchange rate that means 1080 US Dolars.Yes a Nokia N95 costs more than 1000 US Dolars here in europe. My Nokia N70 cost 490 euros(660 US Dol.) 8 or 9 months ago. So please stop complaining about the price. Over here in europe the iPhone will probably sell for 400 to 500 euros, That is 300 Euros LESS than the best Nokias so I belive that it will sell even better than over there. There is also much talk about 3G and 3.5G, as far as I am concerned those are just excuses for the telecoms to rip off their custumers, 3G is, I believe, overrated… unless, of course, you are selling the service.
In case you didn’t read it just this week the EU fixed a price for the roaming charges to 0.49 Euros, that is much less that half of what I used to pay just last year, and it was about time.
Hard to compare an iPhone with a Ferrarri. Anyone can get laid if they have a Ferarri….
iconoclast,
Firstly, your visualization of average cell phone use is WAY off the mark. People of all ages all across the country in all classes spend as much time on their cell phones as they do with people in person.
Secondly, regarding people who might think $500 is high for a cell phone: I hope you’re not referring to those that live in economically depressed neighborhoods that sport $1500 worth of spinners on their blacked-out Honda Civics. Or the ones collecting welfare but are driving Escalades.
Affordability is relative.
There are plenty of people out there that really can’t afford an iPhone. That doesn’t make those of us who can justify amortizing $500 over 3-5 years “out of touch.”
MW: would. You “would” need an ability for critical thinking to understand.
You messed up your calculation, Not From the USA. the Nokia N95 goes for $700 in the US.
And that is WITHOUT the commitment of a 2yr contract. That is $700 UNLOCKED, able to be used on any GSM carrier (barring certain circumstances).
The N95 is basically what we originally imagined the iPhone would be: a high powered device sold unlocked at full-retail through the maker’s own retail chain with no carrier ties.
If it proves true that you can’t even purchase an iPhone unlocked without AT&T service, the price becomes a pain. Not to mention the fact that the N95 has a stunning 5 megapixel camera with Carl Zeiss optics and 3.5G HSDPA data.
Don’t get me wrong, I’d take the iPhone over the N95 any day of the week, even without 3G and what’s likely a sucky camera. Not arguing it’s a better phone or anything but it’s an attractive offer for $700.
Let’s face it, the reason why Apple got such a good deal is because AT&T will use the device to bleed as many new customers as possible. The iPhone is a well-designed, girthy strap-on that AT&T plans to rape us with.
@R2: that’s a pretty interesting metaphor there. Never thought of an iPhone as a well designed dildo before….