Apple CEO Steve Jobs has posted an open letter to all iPhone customers on Apple’s website. Here it is verbatim:
To all iPhone customers:
I have received hundreds of emails from iPhone customers who are upset about Apple dropping the price of iPhone by $200 two months after it went on sale. After reading every one of these emails, I have some observations and conclusions.
First, I am sure that we are making the correct decision to lower the price of the 8GB iPhone from $599 to $399, and that now is the right time to do it. iPhone is a breakthrough product, and we have the chance to ‘go for it’ this holiday season. iPhone is so far ahead of the competition, and now it will be affordable by even more customers. It benefits both Apple and every iPhone user to get as many new customers as possible in the iPhone ‘tent’. We strongly believe the $399 price will help us do just that this holiday season.
Second, being in technology for 30+ years I can attest to the fact that the technology road is bumpy. There is always change and improvement, and there is always someone who bought a product before a particular cutoff date and misses the new price or the new operating system or the new whatever. This is life in the technology lane. If you always wait for the next price cut or to buy the new improved model, you’ll never buy any technology product because there is always something better and less expensive on the horizon. The good news is that if you buy products from companies that support them well, like Apple tries to do, you will receive years of useful and satisfying service from them even as newer models are introduced.
Third, even though we are making the right decision to lower the price of iPhone, and even though the technology road is bumpy, we need to do a better job taking care of our early iPhone customers as we aggressively go after new ones with a lower price. Our early customers trusted us, and we must live up to that trust with our actions in moments like these.
Therefore, we have decided to offer every iPhone customer who purchased an iPhone from either Apple or AT&T, and who is not receiving a rebate or any other consideration, a $100 store credit towards the purchase of any product at an Apple Retail Store or the Apple Online Store. Details are still being worked out and will be posted on Apple’s website next week. Stay tuned.
We want to do the right thing for our valued iPhone customers. We apologize for disappointing some of you, and we are doing our best to live up to your high expectations of Apple.
Steve Jobs
Apple CEO
Source: http://www.apple.com/hotnews/openiphoneletter/
Don’t let the noise of other’s opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. – Steve Jobs, June 12, 2005
Above and beyond the call of duty? The squeaky wheel gets the grease? Insanely great or greatly insane? Too little, too late? The foundation of justice is good faith? I love it when a plan comes together? Do what you feel in your heart to be right, for you’ll be criticized anyway; you’ll be damned if you do and damned if you don’t? The customer is always right? It was preordained? Played like a fiddle? That you may retain your self-respect, it is better to displease the people by doing what you know is right, than to temporarily please them by doing what you know is wrong? Keep true, never be ashamed of doing right; decide on what you think is right and stick to it? The secret of life is honesty and fair dealing; if you can fake that, you’ve got it made? If life were fair, Elvis would be alive and all the impersonators would be dead?
Hey, we’ve got hundreds of ’em. What’s your take?
@justified
I understand there are now very effective medications for those with conditions such as yours.
I never repeat myself
I have never repeated myself
I was worried that the next time Apple had a new product there’d be a lot fewer folks lining up as early adopters, and that there’d be angry picketers with messages like “Remember the iPhone.” Now I’m satisfied that the vast majority of us early adopters will look back on our “Summer of the iPhone” with great pleasure. Steve, you did good. Thanks.
@WBFS,
Chirp.
So, MPC Guy and Galloway are gonna get all mushy. Next think you know, they’re be swapping spit. HAGS!
After justified, you sissies are too easy!
why are we all so please with $100? The price drop was $200. Return your phone to apple, they have a $50 restocking fee. then buy a new phone you will be up $150
@Crickets
Crunch!
I remember a day when you could come to this board for mac news, discussion, and even heated debate. now it’s just a bunch of fight picking kids with too much time on their hands. oh well. MDN must love the hits.
why are all so please with $100? The price drop was $200. Return your phone to apple, they have a $50 restocking fee. then buy a new phone you will be up $150
Apple Inc. wasn’t obligated to do anything. This is beyond the call of duty. Early adopters of a new product are just that, early adopters.
Apple has every right to drop the price of any of their products as they see fit. Haven’t we all bought electronic equipment to see newer models introduced weeks or months later, with better spec’s for lower prices?
To everyone who bought an iPhone already, quit whining! You made the decision to buy a brand new product. Of course Apple was going to lower the price. What’s surprised everyone is the rapidity and amount of the price drop. So what? Like others have said, they’re in business to make money.
Some people were interpreting this price decrease as a sign that the iPhone was not selling well. It was a “bad sign”, supposedly. Apple does not go into these things will nilly and talking out of their butt like so many people on the internet.
Fact is, they had to do something major to the iPod line, since it’s been a very long time since they have. And the last thing they’d want to happen is for MS to have learned from their initial Zune mistake and actually get some things right on their second try. I mean, as much as I hate MS, that is a possibility.
So you have the iPod Touch. But it could siphon off too many iPhone sales if you’re not careful, so the price *had* to come down to where it is if they want to own these markets. And clearly, the really want to own these markets.
SJ wants to hand Bill Gates ass to him this time around. There is still some soreness there, from MS having “won” with a grossly inferior product. And SJ is just the kind of ego-driven genius that won’t let it stand.
Love the iphone its awesome and for me that I bought 2 4g models & with the price drops it hurts but i never did worry steve always comes through all the time and by next week things (Apple) will probably be good to us. Just one day into the price break Jobs realized his apple fans felt the pain and decided to do something bout it gota love steve. Apple fan forever!!!
I’d saaayy…quit complaining oh “loyal customers”.
It’s marketing genius, and almost certainly planned to go down exactly like this from the very start. Drop the price of the iPhone – big publicity and boosted sales. Early adopters complain – give them $100 back. Apple look like heroes who listen to consumers and act on it quickly, they get even more free publicity (most of it good), and they know that there’ll be thousands of people spending at least $100 (because lets face it – most people will put the credit towards something that costs more rather than just spend exactly $100) in apple stores before the holiday season, making the sales figures for the quarter look astronomically good and easily offsetting the cost of the payout in increased sales that otherwise wouldn’t be there.
Again, marketing genius.
BFD.
The headline for this article should have been, “Judas promises to return fifteen pieces of silver”.
Betrayal cannot be easily covered by a bribe for many of Apple’s most devoted customer base. We, who are regular Apple customers, understand how tech works, how prices fall and how products improve. But why didn’t prices fall in the six months BEFORE the launch? Because Apple thought it could sodomize it’s most faithful and then send them flowers afterward. For many that is not going to be good enough.
When a love affair ends it’s never pretty. Oh, we can be friends…someday. But things will never be the same as before. Never. And for a LOT of people their love affair with Apple ended yesterday.
“Apple thought it could sodomize it’s most faithful and then send them flowers afterward.”
Apple Knows it can sodomize it’s faithful they’ve done it time and time again with unreliable products and platform changes and yet the victims keep coming back. That’s what it means to be one of the Apple faithful. And if they had any intention of sending flowers they would have announced the $100 back at the same time as the price drop.
“why didn’t prices fall in the six months BEFORE the launch”
The answer is simple. It’s a desperate move.
After the initial surge the iPhone’s sales have dropped off. Clearly Apple miscalculated big time the number of people would buy a $600 cellphone. Steve has to pay the piper now or later.
If the drop were planned, Steve would have introduced a new iPhone, say 16GB version, dropped the price on the old ones, and discontinued the 4GB and everyone would be (relatively)happy. A huge price drop after 2 months is in no way planned.
If they didn’t drop the price, already miserable August sales would continue through September and in the next earnings call Steve would have to announce that the iPhone was a iFlop and the stock (and Steve’s net worth) would drop like a stone.
As it is they’re dropping the price to stimulate demand in the hope of getting a 2nd iPhone purchasing surge before the end of the quarter so they can report some good news.
Unfortunately margins will be in the toilet, but maybe they will be able to show an acceptable number of units sold.
The $100 rebate clearly wasn’t planned either. If it was, it would have been announced at the same time to take the sting out of the drop. If it was that would be classy. Given that it wasn’t it’s just another desperate move to cover another miscalculation in how the faithful would react.
“The secret of life is honesty and fair dealing; if you can fake that, you’ve got it made? If life were fair, Elvis would be alive and all the impersonators would be dead?
“Hey, we’ve got hundreds of ’em. What’s your take?”
My take is MDN should lay off the weed before writing takes on stories.
Are you for real?
And as for “Actually”: “miserable sales”? You mean, as in outselling every other smartphone? And “Steve has to pay the piper”? — wow, I’ve never heard such drivel coming out of someone’s ass before. No, actually, Apple is just trying to keep the momentum going.
Above and beyond the call of duty?
The squeaky wheel gets the grease?
Insanely great or greatly insane?
Too little, too late?
The foundation of justice is good faith?
I love it when a plan comes together?
Do what you feel in your heart to be right, for you’ll be criticized anyway; you’ll be damned if you do and damned if you don’t? The customer is always right? It was preordained?
Played like a fiddle?
That you may retain your self-respect, it is better to displease the people by doing what you know is right, than to temporarily please them by doing what you know is wrong?
Keep true, never be ashamed of doing right; decide on what you think is right and stick to it?
The secret of life is honesty and fair dealing; if you can fake that, you’ve got it made?
If life were fair, Elvis would be alive and all the impersonators would be dead?
Originally my thoughts were that Apple shouldn’t have to owe anyone anything. EVERYONE, especially those who waited in line, knew that the iPhone was going to drop in price. I don’t even want one and I knew it! My feeling is that consumers need to take more responsibility with their purchases and spend less time bemoaning the companies that they purchase from.
But I think this is a really slick move on Apple’s part, and I applaud it. Firstly, it lets his early adopters know “We’re not Microsoft, we’re going to take care of our fanbase” and secondly, “We appreciate your faith and we want to make it known.”
Slick, and very impressive! I’m not usually a fan of Steve Jobs, but this is applause-worthy. There’s certainly something to be said about reaching out to your customers even AFTER they have bought something. I don’t feel that these customers were owed this money, which makes it even nicer. Now they can just apply this $100 credit to their next fan-boy purchase
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Fkn-A!!!!
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This is simply nickel and diming. It is not a “refund”, but a “credit”. Meaning that you have to buy something in the future. And why not go full throttle and give the full $200? After all, most people don’t use credits due to procrastination, etc. – so they should be easy to give away.
The reason that Jobs answer is disingenuous is that this type of price reduction on a new Apple product is unprecedented. It’s one thing if the product is out for 6 months before a price reduction (and you bought at month 5) – then what cousin Stevie has to say is correct – it’s a completely different thing for a new first generation product. One, incidentally, that I love, but that I have also had to exchange once because of problems with “no signal” after 20 days.
So I rate this a big failure – and this is from someone who has bought 3 iMacs and a MacBook for my family within the past year.
200 comments in 24 hrs for this story.
Nothing short of amazing.