[GAD]

http://www.apple.com/hotnews/openiphoneletter/


Quote:

To all iPhone customers: I have received hundreds of emails from iPhone customers who are upset about Apple dropping the price of iPhone by $200 two months after it went on sale. After reading every one of these emails, I have some observations and conclusions. First, I am sure that we are making the correct decision to lower the price of the 8GB iPhone from $599 to $399, and that now is the right time to do it. iPhone is a breakthrough product, and we have the chance to 'go for it' this holiday season. iPhone is so far ahead of the competition, and now it will be affordable by even more customers. It benefits both Apple and every iPhone user to get as many new customers as possible in the iPhone 'tent'. We strongly believe the $399 price will help us do just that this holiday season. Second, being in technology for 30+ years I can attest to the fact that the technology road is bumpy. There is always change and improvement, and there is always someone who bought a product before a particular cutoff date and misses the new price or the new operating system or the new whatever. This is life in the technology lane. If you always wait for the next price cut or to buy the new improved model, you'll never buy any technology product because there is always something better and less expensive on the horizon. The good news is that if you buy products from companies that support them well, like Apple tries to do, you will receive years of useful and satisfying service from them even as newer models are introduced. Third, even though we are making the right decision to lower the price of iPhone, and even though the technology road is bumpy, we need to do a better job taking care of our early iPhone customers as we aggressively go after new ones with a lower price. Our early customers trusted us, and we must live up to that trust with our actions in moments like these. Therefore, we have decided to offer every iPhone customer who purchased an iPhone from either Apple or AT&T, and who is not receiving a rebate or any other consideration, a $100 store credit towards the purchase of any product at an Apple Retail Store or the Apple Online Store. Details are still being worked out and will be posted on Apple's website next week. Stay tuned. We want to do the right thing for our valued iPhone customers. We apologize for disappointing some of you, and we are doing our best to live up to your high expectations of Apple. Steve Jobs Apple CEO

GAD

 

[DLeeWebb]

Quote:

Originally Posted by GAD /img/forum/go_quote.gif http://www.apple.com/hotnews/openiphoneletter/ GAD

Awesome move...

 

[milkpowder]

Steve is a good businessman. He knows how to work the market to his benefit.

Quote:

Originally Posted by "fellow" Engadget reader, Quix My theory says Apple planned this from the beginning. Hear me out. This is how Apple might have calculated this approach. Assume Apple decided $399 was a profit sweet spot for the iPhone before they even released it. By tacking on another $200 at the launch announcement in January, they got a lot of heat from the blogosphere and the tech punditry, but demand/hype for the thing remained in the stratosphere (perhaps to Apple's surprise?). Had it not, Apple could have simply announced a new lower launch price in the weeks leading up to June 29. Bam, instant hype boost. But it turns out such a move was unnecessary. Tens of thousands of customers lined up outside Apple and AT&T stores all over the country, snatching up every iPhone they could when the doors were thrown open despite the $599 price. Suddenly you have a product with huge perceived (and real) demand that still commanded a very high price tag. And a $599 product that is flying off the shelves and being waved about gleefully by ecstatic mobs of buyers on TV news suddenly has a perceived value of $599 for millions of customers, including those who wouldn't (or couldn't) pay the $599 entry fee. Now, two months later, you drastically slash the price $200, to your originally-decided price point of $399. Wow, only $399 for a product with a perceived value of $599??? What a deal! Waves of customers swarm the Apple Store once more snatching up these new "bargain-priced" iPhones for "only" $399. Talk about keeping the momentum going. Now, of course, you are left with the serious problem of hundreds of thousands of irate Apple customers (like me) who feel burned by the too-much too-soon price cuts. Brand loyalty is not a commodity tossed aside with little regard. So what to do? Why, offer previous iPhone buyers a $100 credit at the Apple Store, of course! "Apple loves us!" the customers cry, and the company image rises even higher than before due to their good will and stellar customer service. And the $100 we suddenly have to spend at the Apple Store doesn't really cost Apple $100 at all, yet boosts sales quantities (read: market share) going into the holiday buying season, and we customers are just grateful to Apple for letting us spend $100 more dollars at their store. Well played, Mr. Jobs, well played.

As a bit of an Apple fanboy myself, is my skepticism uncalled-for?

 

[Duggeh]

The good news is that if you buy products from companies that support them well, like Apple tries to do, you will receive years of useful and satisfying service from them even as newer models are introduced.

Well that's a heap of gob****e. Apple has failed since dot to update the software on older iPod models to include features of the newer ones despite the fact that its well within the abilities of those older models.

People complain that it took Microsoft years to replace XP with Vista. I think its damn better than having a new, slightly shinier big cat every 12 months making you fork out again. There's another example.

Apple keeps its product line very shiny and people clamour for the newest toys. Their product obsolescence factor is huge. Fortuitously, the older products were still really good at what they do, and there's no need to replace your ipod photo with the newest touch screen model.

As far as the business side is concerned, the only really excellent move Apple ever made with the iPod was deciding to make it available for use with windows PCs and not just macs.

 

[mrarroyo]

With the kind of mark ups at the Apple store that $100 is more like $50. Yes a good marketing move where Apple will make money on.

 

[krmathis]

Nice move from Apple.
They certainly scored some credibility on this one...

 

[ozz]

i should have bought stock when it was cheaper.

 

[feckn_eejit]

Quote:

Originally Posted by ozz /img/forum/go_quote.gif i should have bought stock when it was cheaper.

QUOTED FOR TRUTH!!!

 

[ingwe]

I haven't seen any details posted to the apple site yet.

 

[LawnGnome]

Apple makes most of their profits off of people who don't know any better. And buy into the trendiness of apple products.

 

[ingwe]

Okay, this sounds like fun!

ahem...

Steve Jobs is a corporate feudal lord with an iron grip over vast masses of doe-eyed serfs, tied to their products, toiling under the weight of their inferior iBuds.

Q: But how do we know he's a feudal lord?
A: Because he doesn't have **** all over him!

 

[uzziah]

how did you become king? i didn't vote for you?

....you don't vote for kings.....the lady of the lake, held up a sword......

"what, that's no basis for a stable government, .......


ehh.... you know

 

[kugino]

Quote:

Originally Posted by LawnGnome /img/forum/go_quote.gif Apple makes most of their profits off of people who don't know any better. And buy into the trendiness of apple products.

yeah, nice blanket claim there.

some of us "buy into" apple products because, well, it runs and works better than other alternatives.

 

[iReally]

^ Word.

I love apple, but I don't buy every new thing that comes out. Just because they introduce newer versions of their products all the time doesn't make them evil.

 

[LawnGnome]

Quote:

Originally Posted by kugino /img/forum/go_quote.gif yeah, nice blanket claim there. some of us "buy into" apple products because, well, it runs and works better than other alternatives.

runs and works better eh?

Macs are pretty much an Intel PC with OSX on it. (that costs many times more than regular PC's) Plus you get the limited hardware and software support. Many hardware vendors flat out do not support Macs. And don't plan to do any gaming or use much of the newest software, since it won't run on a mac. (unless you run windows on mac, in which case your running an Intel PC with Microsoft OS in a fancy box.)

The iPods have many problems, horrible battery problems, screen scratching, planned obsolescence. Apple has already settled several class action lawsuits. Plus you have to use god awful itunes.

Maybe the iPhone? I think it already has some class action lawsuits already in the works. This article goes to show how Apple slaps its consumers.

Also, all of their stuff is overpriced. 1000$ for a Mac 23" LCD. You can get bigger, better spec'd screens for literally half the price. They charge 60$ for a regular corded optical mouse. 60$ for a basic wireless keyboard. And every one of those Macs are about 500 to 1000$ more than a equivalently priced system.

But people say "oh but the line out is decent", Yes, well with the money you could have saved with buying a PC, you could have spent 500$ on a professional soundcard or DAC.