The ‘Apple Tax’ died years ago

AirPods Pro bring the magic of AirPods to an all-new lightweight, in-ear design.
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Neil Cybart, Above Avalon:

Two weeks ago, Business Insider caused a stir with a video titled, “Why Apple Products Are So Expensive.” The video was part of Business Insider’s “So Expensive” series, which takes a look at why certain items are priced the way they are.

The video was troubling for the number of inaccuracies, falsehoods, and outright lies it included about Apple and its pricing strategy. According to Business Insider, Apple products are expensive because loyal users are willing to pay an “Apple Tax,” or a higher price attached to products containing an Apple logo. A closer look at Apple’s actual pricing strategy reveals a fundamentally different explanation for why Apple products are priced the way they are. The days of there being an “Apple Tax” ended years ago…

Apple’s ability to grab monopoly-like share of industry profits isn’t a result of there being an Apple Tax but rather a byproduct of Apple following a design-led product strategy that ultimately marginalizes industries.

MacDailyNews Take: The “Apple Tax” always failed the logic test because the price is not higher “because it has an Apple logo on it,” but because it contains a unique, superior operating system and unique, superior apps tied into a unique, superior ecosystem (see: Continuity, for one example) that “just works” (most of the time, but especially in comparison to non-Apple tech).

From the Mac to the iPod to iPhone and iPad to Apple Watch and AirPods: Apple products are better designed, with symbiotic, custom, complimentary hardware and software (not off-the-shelf parts trying to work with an off-the-rack OS) and offer smoother, more elegant operation as a result.

In short, Apple products are generally worth whatever “extra” cost (and then some) vs. competitors’ rudimentary wares.

Those of us who are smartly all-Apple have such an easy time with technology compared to the rest of the world. Inside the walled garden we have Continuity – it all just works! — MacDailyNews, July 18, 2019

17 Comments

  1. Please explain then the 3x-4x markup on Mac Pro RAM when bought from Apple, versus buying the exact same RAM elsewhere and installing it yourself.

    The Apple tax is also the inability to upgrade RAM and storage after purchase for iMacs and Macbooks, so you’re forced to pay an outrageous amount to upgrade to what you THINK you’ll need 4-5 years from now. It’s the utterly pointless thinness of iMacs making them not only non-upgradable but also hard to self-service (e.g. replace dead HDD). It’s the days wasted without your laptop after having to leave it at Apple to replace their beta-level butterfly keyboard (sure PC laptops fail and waste days too… but you paid EXTRA PREMIUM for Apple quality, right?).

    1. The self service part irks me! With devices being so thin today, Apple should be able to design them so you take a cover off and things popup off easily as mostly everything is a single layer or close to it. Not reason they have to be so difficult to work on! They do it deliberately and money is wasted and I’m sure the cost is higher because of that as well. We are in the age of waterproofing and that does make it a little more difficult, but I think it can me more simple overall. Macbooks should be very easy to replace the logicboard, etc.

      1. I have to disagree with you on this one, KenC. When the SSD or RAM is soldered in and/or not user accessible, then Apple is forcing you to buy your internal storage or RAM upfront when you purchase your Mac or other Apple device. In this case, the Apple markup on RAM and larger SSDs does amount to a form of an “Apple Tax,” as much as I dislike that term because of its history of inaccurate and improper usage.

        The “Apple Tax” keeps popping up because some Apple product lines do not offer a low-priced option to compete with non-Apple products (e.g., PC laptops ranging from $350 to $650). However, Apple does offer competitively priced, entry level products in other areas, such as the iPad and iPhone.

        The Apple Tax has been assessed many times in the past. In my experience, almost every fair and balanced product comparison has shown that Apple’s prices were competitive. You just can’t buy a cheap Apple desktop or a cheap Apple laptop.

      2. Then you’ll have no choice but to agree there is an Apple tax on RAM for iMacs, Macbooks, Macbook Airs and Macbook Pros. They just can’t hide it on the Mac Pros.

        $200 to upgrade a 13″ MBP 8GB RAM to 16GB RAM? Please. A single 16GB module is in the $100 range.

        The value of the Mac USED to be that the core components and OS were premium, but you could upgrade the RAM and drive yourself later as required. These days the value is WAY down. MBs with only 128GB storage, and $200 more to merely double that to 256GB, is an embarrassment that I cannot in good faith recommend to anyone looking for an entry-level computer.

  2. Apple certainly merits constructive criticism in some areas. Thats what feedback and “voting with your feet” are for. Buy your RAM elsewhere; figure out work-arounds, etc.

  3. Yes they are more expensive, especially the RAM and drive upgrades. Yet, I will pay the seemingly unreasonable upgrade because, when I tried to get by with a PC with same specs at less than a third the price, the frustration and tediousness of having the same tasks take 3 times as many steps and constant work arounds and searches to solve problems made the cost of the PC just money thrown in the garbage. Life is too short to spend more work time on your computer than on the work. And though it costs more, the useful lifetime of the machines is so much longer it helps to balance the upfront costs. If your needs are minimal go ahead and PC, but if you spend a large part of your time on technology products, Apple is worth it. Every time I add an Apple product my life gets easier.

  4. Much as I think Apple’s products are worth it and that generally the extra price reflects extra value, things like high prices on RAM, cables and other accessories and options are indeed “Apple Taxes.” I’m not saying they aren’t justified, just that they are priced artificially higher than the supplier cost requires. Just like government taxes are required to build roads, run schools, police and fire, keep us safe from unscrupulous individuals, etc., Apple manages a complete ecosystem that requires taxes for the commonwealth of its users. There is no question this is a great thing.

    On the other hand, if you believe everything should be free or artificially cheap, you are free to use Google products and services. You get what you pay for. Try calling Google’s “Customer Support…” Hint, you can’t unless you are business subscriber.

    Those who complain about the “Apple Tax” might be having a temper tantrum. Somebody has to be the adult and that is usually Apple.

  5. I don’t think there should be any logical reason Apple charges so much more for RAM. Whatever happened to buying in bulk leads to lower pricing. Apple should easily be able to save money buying RAM in bulk and then passing some of the savings off to consumers. I’m not complaining. I simply don’t understand except that Apple is greedy for profits. Unless Apple explains to me why they charge more for RAM, I can only assume Apple is being greedy. I’m not making a big deal out of it because over the course of years of ownership that extra cost doesn’t matter. As a long-term Apple shareholder, I’ve received far more than a few sticks of lower-priced RAM.

    However, I would certainly like to know why Apple charges so much more for RAM. Charge what the market will bear, I suppose. I would think they could sell more computers if they charged less for RAM, but I might be wrong. A trillion-dollar company surely must know something I don’t.

    I can honestly afford to pay upfront for non-replaceable RAM or storage, but it still somewhat irks me. However, not to the point to lose sleep over. Apple Tax or whatever, I’m still going to buy Apple products and have no reason to change. I like using Apple products and that’s that.

    1. I would have replaced my 2012 MBP by now, if the new MBP RAM and drive were user-upgradeable. But my old MBP is upgraded to a 1TB SSD and 10 GB RAM, for a little under $200. Paying $600 on top of the base price to get 1 TB SSD (and drop 2GB RAM, otherwise add yet another $200 to get 16GB) on current models is poor value for money.

  6. Chalk up higher than market prices for RAM to Government regulation. When Apple decided to give it’s OS away for free (remember we use to pay for it) and its software (Pages, KeyNote, Numbers, etc.) the government required the company to demonstrate where they would make up the lost revenue. Part of government regulations against monopolies, a company like Apple can’t simply give stuff away to its customers. For Apple to “give us free” software and software ware updates, they had to satisfy the government they weren’t running a loss leader that could negatively effect their competition.

    1. Chalk up higher than market prices for RAM to Government regulation

      Sorry, not buying that argument.

      Apple build-to-order RAM prices have ALWAYS been higher than market, even when you could upgrade the RAM and storage yourself, and that’s when we were still buying the OS.

    2. Chalk up higher than market prices for RAM to Government regulation…

      Nope. This scenario does not apply because Apple isn’t giving away extra RAM for free.

      They’re not even selling it at less than the Market reference price charged by 3rd Party retailers.

      All of the ‘free OS/Software updates’ expensing has to apply to the base configuration, because customers receive that benefit in the base configuration, regardless of if a machine is optioned to have more RAM/SSD, etc.

  7. https://www.dell.com/en-us/shop/dell-laptops/new-inspiron-17-3000-laptop/spd/inspiron-17-3793-laptop/nn3793dthgh

    Here is an i7 laptop with 16gb ram, and 512 gb SSD.
    $779

    What can Apple do for $779?
    Nothing.

    Here is a $1099 mac. It is inferior by every measure. i5, 8 gig ram, 128 gig SSD, 13 inch screen.
    https://www.apple.com/shop/buy-mac/macbook-air/space-gray-1.6ghz-dual-core-processor-with-turbo-boost-up-to-3.6ghz-128gb#

    Why is the Mac better? Brushed aluminum? Useless thunderbolt ports? There was a time with MacOS was worth a lot, because it was so much more trouble free. But that is not true any more, and a lot of MacOS’s faults are self inflicted. (Compatible with windows, but not 32 bit mac apps?)

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