“Across the board price cuts announced by Apple on its iPod touch line of digital media players are ‘nice,’ but may not be sharp enough to drive a sales surge given economic conditions and the more aggressively priced iPhone 3G, according to one Wall Street analyst,” AppleInsider reports.
“American Technology Research analyst Shaw Wu, who had previously recommended that investors reset their expectations for Tuesday’s ‘Let’s Rock’ event, believes favorable commodity pricing on components such as NAND flash will allow Apple to absorb the new cuts without a material hit to its margins,” AppleInsider reports.
“‘As expected, the new second generation iPod touch has a slimmer form factor with lower price points of $229, $299, and $399, respectively for its 8 GB, 16 GB, and 32 GB models,’ Wu told clients,” AppleInsider reports. “‘While we are pleased to see lower pricing, we are concerned that price points may remain too high given the tough macroeconomic environment and relative to the 3G iPhone at $199 and $299.'”
Full article, in which UBS Investment Research analyst Maynard Um offers a completely different take than Wu (“we believe it will stimulate demand and benefit profits”), here.
Um is right. Wu is wrong.