Apple doesn’t do low budget

“Apple Inc. proved one thing this year: It can charge whatever it wants for iPhones,” Shira Ovide writes for Bloomberg. “Mark Gurman and Debby Wu of Bloomberg News revealed more details of Apple’s planned makeover for its fall 2018 iPhone models. There will be an updated version of the 2017 iPhone X; a higher-end, larger-screen edition of the iPhone X, presumably with an even higher-end price; and an iPhone X-like model with some more basic parts that will serve as the entry level model in Apple’s 2018 lineup.”

“Apple has never done well selling the “good” phones in its lineup. That has hardly mattered because the more entry-level models effectively serve another duty: They push people to the more expensive versions that Apple increasingly relies on for its sales growth,” Ovide writes. “The average iPhone sale price rose to $758 in the nine months ended June 30 compared with $661 at the same point in 2017. That is testament to demand for the $1,000-and-up Phone X, which Apple says has been the top-selling iPhone model since it went on sale.”

“Both for its original computer business and later with the iPhones, Apple’s approach has never been volume sales. Instead, Mac and iPhone have held minority shares of their markets, but their premium prices have given Apple the majority of profits in both computers and smartphones,” Ovide writes. “Apple’s price-over-volume strategy has helped it become the most valuable public company in the world.”

Read more in the full article here.

MacDailyNews Take: Yup.

Newsflash: Apple sells premium products at premium prices to premium customers.SteveJack, MacDailyNews, October 23, 2012


  1. I don’t mind if Apple going to sell a premium product at a premium price but they better back up their product and fix their engineering mistakes.

    I’m taking my 2 year old 2016 MacBook Pro into the shop today because the keyboard isn’t working.

    Look it up, it’s a major issue with several lawsuits already and Apple has stated they will not update the keyboard. They will simply replace it … with the exact same one…that has the exact same problems.

    Basically just prolonging the stupid thing so that it occurs again. That’s utter garbage!

    Welcome to Tim Cooks Apple where they don’t fix their mistakes and expects the consumer to pay hundreds of dollars…

      1. Replacing it With the exact same one that is known to have problems…read my post again. That was my complaint. Fix it with the updated design instead of simply replacing it with a defective design.

        1. I often wonder who comes up with such lousy policies. They’re just asking for trouble from customers. However, I’ve still heard from questionable sources, that this keyboard problem only happens to a very small percentage of users.

          Don’t worry, I would also expect Apple to replace the defective keyboard with an updated model. Customer satisfaction should rule out over the cost of an updated replacement keyboard. Of course, the whole idea that a single keyboard switch can’t be replaced really burns me up and definitely runs counter to Apple’s claims of wanting to help save the environment. Apple has gone too far with such a low-profile keyboard that fails because of dust or a crumb getting in it.

  2. And that’s going to be a thorn in Apple shareholder’s sides when it comes to market share percentage in BRIC nations. Already analysts and pundits alike are saying how Apple is missing out on all those millions of smartphone users in India. How Tim Cook has screwed up by not being able to sell tens of millions of iPhones in India like they do in many other places in the world.

    Apple has no equivalent of Android Go that can run on $50 to $100 “almost smartphones.” I can easily see that Apple can’t compete with those low-end phones, but analysts seem somewhat puzzled by that. Why would such a thing come as a surprise to them? Somehow, they think Apple should be able to find a way to sell products to consumers who can’t quite afford those products. Should Ferrari be able to find a way to sell its cars to people who can basically only afford Toyotas or Nissans?

    Maybe they expect Apple to produce a low-cost lineup like Samsung would do. Apple, in theory, could do that in order to increase market share percentage by a tiny amount, but the margins would suck. Apple would still have to support that low-cost product line just like the higher-priced models. I don’t think it would be worth the effort.

    1. Actually, Ferrari does. They call them Maserati, Alfa Romeo and if you really need to get down to the Toyota level of pricing, Fiat.

      I would like to get a $200 throw away phone that will run iOS in a pinch. I can’t unless a risk a used one. So I have a Motorola Moto G which has about the same compute power as an iPhone 6 for when I just want to make a phone call and access a few apps in a pinch.

  3. I think Apple’s price-over-volume strategy is something Wall Street doesn’t like and causes Apple’s P/E to remain range-bound. This is just my opinion. I personally think most investors equate low market share percentage with high risk.

    I don’t quite understand that view because I’ve seen high market share percentage companies also fail, so that’s no guarantee of anything. There are a number of reasons that can cause companies to fail, apart from market share percentage.

  4. Gawd! Can we – and the world – puhlease get over this marketshare bullshit.
    The pathetic performance of numerous companies show what use that is. Why should Apple try to expand into the low end which is clearly demonstrated to be low to no profit?

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