“According to Porteligent and as reported by EETimes, the parts cost of the 3G iPhone may be as low as $100. That means that even at $199, Apple’s price includes a roughly 50% gross margin over its parts cost, which is in the ballpark of the gross margins on traditional iPods. If AT&T is adding in a $200 subsidy, then the iPhone 3G is anything but a a phone requiring a carrier subsidy. In fact, if these numbers are true and the carriers are subsidizing the phone, the iPhone 3G could end up being the most profitable product Apple makes. But more likely, this means that Apple has a lot more pricing flexibility than analysts have given them credit for,” Carl Howe blogs for Yankee Group.
Howe writes, “Apple’s 3G phone isn’t a loss-leader product needing subsidies to survivie. It’s designed to be an Anywhere phone that puts your online life, media, and connections in your pocket, yet be simple enough for your grandma to use. But for Apple, it’s a business platform designed to make money — and the details of that business design may surprise more analysts than the product itself.”
Full article – recommended – here.
[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]
