Markoff reports, “Steven P. Jobs, the chief executive, said in an interview after the announcement that Apple would have been able to hit its publicly declared target of a million iPhones sold in the United States by the end of this month, even without a price cut. ‘We’re a high-volume manufacturer, and we’re pretty good at getting costs down,’ Mr. Jobs said. ‘It’s very clear we have a breakthrough product on our hands, but it’s also clear that many can afford it, some can’t. We’d like to make it affordable to even more folks going into this holiday season.'”
Markoff reports, “Mr. Jobs said that if the company had waited past the Christmas buying season to reduce prices it would have been forced to delay for another year reaching a broader consumer market. ‘We’re feeling like being more aggressive,’ he said.”
More in the full article here.
In an interview yesterday with CNBC’s Jim Goldman, Jobs said, “We want to get more aggressive for the holiday season. So, you know, we know a lot of people want an iPhone. For some, it’s out of their price range. We want it to be affordable for more people as we head into the holiday season. We’ll launch the iPhone in Europe next quarter…. [In] Asia, probably 2008. I think we’ll start to see it in some countries in Europe next quarter.
Full interview transcript here.
Jobs also spoke with USA Today’s Jefferson Graham and Edward C. Baig:
USA Today: What do you say to customers who just bought a new iPhone for $599? Sorry?
Jobs: That’s technology. If they bought it this morning, they should go back to where they bought it and talk to them. If they bought it a month ago, well, that’s what happens in technology.
USA Today: To do this, are you taking a hit on costs? Or have prices really come down?
Jobs: We’re in high-volume manufacturing, and we’re pretty good on the costs side. We’re also willing to be more aggressive. We think we have a real winner, and customers love the iPhone. The product’s been extremely well accepted; we want to put the pedal to the metal. A holiday season is approaching; we’d have to wait another year for another one.
More in the full interview here.
Remaining supply of 4gb iphones is only $299. Now that’s a steal!
This is not the first big price cut from Apple. The huge price cut was when Apple sunk the price for WebObjects 90% in one day. That was huge.
It’s simple. The best marketing device Apple has for the iPhone is current iPhone users.
All the advertising in the world to this point hasn’t convinced tons of consumers out there that the iPhone isn’t just one heck of an expensive cellphone. They just don’t get it cause they haven’t actually seen one yet.
They don’t even think of it in terms of competitively priced smart phone like a Treo. They just think “man $599.00 for a cellphone?”
Until they actually see one and hold one and play with it.
Job’s said consumer satisfaction is off the scale with the iPhone.
So drop the price dramatically in time for Christmas. Get even more out n the streets NOW ahead of the season, and at a great price.
Tons of cellphone contracts coming up for renewal at year end–Christmas Sales will be off the hook with this thing.
Cellphone industry is breaking out the Malox.
“STFU you self-righteous moron.”
I’m not self righteous, but I’m probably smarter, better looking, more wealthy, more spiritual, more honest, and more scholarly than you; and heck, people like me!
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Gheez, I hope it comes to Canada soon. If not, I’ll have to get the iPod touch, but it doens’t have email (I suppose I could use the browser to get web mail).
Oh whine whine whine… bunch of crybabies… this happens all the time. GET OVER IT. If you didn’t think an iPhone was worth $600 you’re an IDIOT for buying one.
The Mac IIvx had a socketed processor, easy upgrade. It was replaced with the IIvi which had a soldered CPU – not so easy (though not terribly difficult.)
But it gave the IIvx an unusual bump in resale value for a while there, and units left on the shelves were snatched up by folks “in the know.”
LOL!
Shafted! 😀
This unfortunately is ‘the early adopters tax’.
I learnt years ago never to rush out and buy the latest and greatest thing from Apple when it comes out.
Basic rule of buying anything from Apple: WAIT A FEW MONTHS before buying the uber gear!
;P
I paid about $2800 for my Mac SE.
Worth every penny and no regrets. And it still works.
re: “STFU you self-righteous moron.”
I’m not self righteous, but I’m probably smarter, better looking, more wealthy, more spiritual, more honest, and more scholarly than you; and heck, people like me!
—
LOL!
I notice you didnt say you easnt a moron though!
:DD
okay… so STFU, Romney.
My first cell phone cost $3500.
“On Wednesday, Apple executives insisted that the price cut had been planned long ago.” …. but what was the trigger? or rather what were the triggers? Maybe flash pricing was one of the many.
Because Apple was buying so much flash memory the price had gone up, this was when they were building the launch stock of iPhones. As a consequence lots of manufacturers built manufacturing facilities so much that there will be a glut in the next few months. Apple has been able to negotiate some strong deals but all consumers of electronics should be happy because Apple has caused a drop in flash price.
Back in the 90s Apple decided to put CD drives in to computers, they ordered two million from Sony and brought the price down for everyone too. Not so many years ago DVD burners were $3000, then Apple introduced Macs for under $3000 including DVD burners.
With the iPhone and iPod touch Apple will have triggered a price drop in small high quality screens too.
That’s the way it goes in high tech, the R&D;and initial investment in plant and machinery is high, the material cost is low. Once the high initial input costs have been amortized prices plummet.
Someone said, “The best marketing device Apple has for the iPhone is current iPhone users”
So why did Apple stiff them?
Everyone expects the price of new electronic stuff to go down, but there is no justification for a 33% cut in 60 days unless there was either profiteering, a product failure, or a going-out-of-business sale.
To those who didn’t buy an iPhone before yesterday’s price collapse, don’t be so smug. At least the early adopters bought their iPhones before Apple had a track record of volatile pricing. At least it was only the iPhone. They might be laughing even harder at you tomorrow. What Apple purchase are you contemplating? The more expensive the product, the greater the risk. What if you buy a new Mac Pro, and the price drops 33% on the 15th day?
It didn’t seem so likely the day before yesterday, but now it is a distinct possibility.
You bought at the price.
Apple decides to be more aggressive and take a hit in the profit margin.
And you moan. Grow up!
To the early buyers: Just enjoy your iPhone. Take responsibility for your own actions for a change… and buy smarter next time. Apple is in business to make money.
You owe the early adapters who paid premium prices for the iPhone at least an acknowledgement of their loyalty and an incentive to continue buying Apple products.
Are you on welfare or do you just possess an entitlement mentality? Apple doesn’t owe anyone anything. They could offer refunds or store credits, but they don’t have to.
Would I have been pissed if I had bought an iPhone only to see the price drop 33 percent in one month? Yes, but that doesn’t mean I am owed anything.
Well, us iPhone early adopters may not have a “right” to feel shafted, but we certainly have the right to wait a few months the next time Apple unveils a new product. Does Apple really want its future “latest, greatest new product” to have pathetic sales the first 2-3 months? In business, rights go both ways…
$100 iPhone – If the 8Gb iPod Touch costs $300 and the 8Gb iPhone costs $400, doesn’t that make the phone part of the iPhone cost $100? That’s subsidised phone locked to an AT&T;contract territory. Looks like the premium value of AT&T;service became apparent early on.
Whiners, whiners, whiners. So sick of the whiners. Yeah, I paid $599 for mine on launch weekend. But guess what: that shiny glass and metal device on my desk right now is still just as shiny as it was last week, regardless of its current selling price.
Like SJ said, if you bought it just a couple days ago, take it back and get a refund on the difference — you’ll get your $200 back. Every major retailer has this policy. If you bought it before that, like me, suck it up and move on. Apple owes you nothing, and neither does any other company who drops prices on their products.
MW: People’s sense of entitlement seems to have <b>reached</i> epic proportions.
To the early buyers: Just enjoy your iPhone. Take responsibility for your own actions for a change… and buy smarter next time. Apple is in business to make money.
I agree, get over it. You still got a great phone that is only getting better with the new iTunes Wireless store and more to come. I wouldn’t be that upset about it.
What the hell are you talking about, the IIvi and the IIvx were released on the same day (Oct 19, 1992). The IIvi featured a whopping 16mhz processor was however only available in Asia, Europe and Canada. The IIvx screamed past it with a 32mhz processor. The both had the same system bus, and both had a processor upgrade path via third-party vendors.
Apple is counting on all the loyal fans to drool over the new product. They create the frenzy with the “Big” product announcement. This is why Apple likes to have so much secrecy. It builds up the speculation, and the desire for the product. They are pandering to the crowds that for years clamored for a new innovation from Apple. I got burned with the Apple TV. Something along the lines of 45 days after it came out the new version with the 160 GB harddrive was released, oh, for another 100 bucks. It is the nature of electronics. You can always count on the early adopters. You plan your product line out in advance. They put the first one out with a few missing things knowing that the cost would be cheaper to manufacturer without 3G, and they also went with 8 GB of memory. They probably already have the 32 GB model with some other enhancements already planned, and set to ship by late 2nd quarter to 3rd quarter of next year. Oh by the way, they will be rolling out a 16 GB iPhone by the 4th quarter, and it may have 3G/broadband. If they hold off on the 3G/broadband thing until early next year they will be able to sucker another round of upgraders before the 32 GB model is out next year.
As an Apple user we like to upgrade. There are tons of folks who stay in the Apple fold because of the integration, and the products work very well for the most part. The problem is when we are somewhat taken advantage of with the repetitive upgrade pricing. That would be the case with the iPhone in this episode. It happens with many other companies. Apple just happens to be very good at these strategies, and they also have many diehard fans. It all comes down to choice. Do you want a product today that is available at a high price, or do you want to wait a little while to see if the demand decreases, and the price is reduced? The choice is that of the consumer.
Man, I’m PISSED!!!! I bought my 40GB iPod in October 2003 for $500!!! Now, four years later, I can get a 160GB iPod for $350. WTF?????? Apple owes me money!!!!
Those of you who are bitching about the price cut have obviously never been an early adopter of a new cell phone in the past 5 years.
I bought a BlackBerry 7290 a couple years back for $399 with 2 year contract. 6 weeks later, it was being offered for $99. Called my service provider and they told me politely that there was nothing they could do for me.
Look at many hot new cell phone out there, and you’ll see similar price drops within months of their launches. Bottom line, if you don’t like it, don’t be an early adopter. Simple as that. If you can’t hold your load long enough for the price drop, then don’t bitch when it happens.