Apple: Wham, Bam, Thank You Fanboi
That was one iPhone early adopter’s crass assessment of his feelings of self-worth, after Apple unexpectedly cut the price of the device by a third–just two months after it arrived at market. At an unveiling of a new line of iPod music and video players in San Francisco yesterday, CEO Steve Jobs said Apple was dropping the price of its 8-gigabyte iPhone from $599 to $399 to drive sales of the device over the crucial holiday selling period. “The customer-satisfaction numbers for the iPhone are off the charts,” Jobs said. “The customer-sat[isfaction] numbers are higher for the iPhone than for any Apple product ever. They love it. But we want to make the iPhone even more affordable for even more people this holiday season. So we’re going to do something about that today. We’re not going to sell it for $599 anymore.”
Now price cuts for cellphones aren’t unusual. Samsung’s Blackjack and Motorola’s Razr both saw rapid price cuts following their respective debuts. But neither was launched into a market of monomanaical loyalists willing to camp out on a sidewalk overnight just to be among the first to own one–many of whom are today feeling a bit used. “Over time I have owned a 3G iPod, original Shuffle, iBook G4, iMac, new Shuffle, 4G iPod, video iPod, iPod mini and now the iPhone,” one wrote in a post to everythingiPhone. “I can see updates to the product line being made over time, but $200 in two months is a kick in the nads to EVERYONE who bought an iPhone.”
Perhaps, especially if the cut was made possible not by a sudden drop in component prices but a calculated overpricing conceived to exploit early-adopter demand. But ultimately, those who don’t think the iPhone was worth $599 when it debuted probably shouldn’t have bought it. “That’s technology,” Jobs told USA Today. “If they bought it this morning, they should go back to where they bought it and talk to them. If they bought it a month ago, well, that’s what happens in technology.”
One last point worth noting here: Early adopters probably aren’t the only folks to be taken aback by the sudden and precipitous drop in the iPhone’s price. Apple’s rivals in the handset market must be absolutely reeling. Here they were scrambling to produce iPhone-like, and iPhone-lite devices they believed would compete with a $600 phone they could easily underprice. Now, they’ve got to compete with a $399 device that is perhaps one of the best examples of Apple’s design and engineering prowess. And they’ve got to do it in time for the holiday shopping season …
Comments
It’s not the money but the sense of betrayal. Apple easily could have dropped the price BEFORE the launch and created an incredible amount of goodwill instead of the anger and animosity they have created with this stupid move.
You don’t screw your best customers should be the motto of every American business and if you ask most iPhone buyers how many Apple products they own most will say several. Personally, I have fifteen. But it will be a long time before number sixteen moves in.
And to all those friends and family member to whom I have effusively promoted and praised Apple, I’m sorry. I thought Apple really did think different. I was lied to.
Posted by Hal Summers at September 6th, 2007 at 11:58 amAll over the internet, people are whining about Apple’s “betrayal” of their loyal customers. Get a life, boys and girls! Anyone who buys cutting-edge technology expecting a price guarantee should have his head examined.
The first consumer DVD players, for example, cost $1000. Within a year, the price had fallen to what? $300? A year after that you could pick one up at your local video store for fifty bucks.
The point is that, with a brand-new product like iPhone, you’re paying for the priviledge of being the first kid on your block to own the very latest supremely cool gizmo. If your joy of ownership is going to be spoiled by a sudden price cut or a “new, improved” model, you should have waited at least a year before buying an iPhone.
Come to think of it, you should have waited forever and never bought an iPhone at all because there will always be price cuts and new models to make you feel suckered all over again. You might want to consider a nice used Walkman. I hear that Sony hasn’t made any changes to that model in quite some time.
Posted by Alan Sanders at September 6th, 2007 at 5:56 pmits not the money that represents a betrayal in my judgment — its the choice of AT&T as the provider. Its the worst service, with appalling customer service. Maybe AT&T offered a better deal than Verizon, but the marginal beneift in dollars in Steve-o’s pocket will be more than outweighed in brand diminution for Apple.
Full admission: I ordered the ipod Touch the day it came out, so maybe I am just another Apple-holic. But at least i get to keep my Verizon phone and flip off ATT!
Posted by mark rovner at September 10th, 2007 at 6:28 am