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Real or Fake - Iphone to be $99?

Discussion in 'APPLE iPhone, iPad Tablets and all iOS Devices' started by Batteries4Less, Dec 8, 2008.

  1. Batteries4Less

    Batteries4Less New Member

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    Does anyone know if this blog has any validity?

    Apple-obsessed financial analyst Charlie Wolf said today in a research note that Apple could cut the price of the 8GB iPhone to $99. Why? Apparently, just because they can. At least, based on his guesstimations on the iPhone margins and costs, and we can only guess, his famed telepathic powers, animal entrails reading abilities, and the shiny 8-ball he has hidden in the bottom drawer of his work desk. Sennhieser MX70 sport earbuds for iPhone .According to Wolf, his estimations puts the price of the unsubsidized iPhone 3G at $666 (because Steve Jobs is really a codename for Satan). That gives Apple a nearly 50 percent gross margin for each iPhone, and a $450 subsidy from AT&T. And from there, boom, jump into the theory of a $99 iPhone 3G 8GB with a "comfortable 42.3 percent margin".

    He also says that a $100 price cut could "double or triple" (or quadruple, if you are at it) the iPhone 3G sales, putting the example of the Motorola RAZR cellphone, which beat Apple's smartphone this summer, even while it was free or almost-free and belonged to a completely different category. According to him, the price cut could be "potentially devastating" to competitors. He must be right. We all know how devastating it was when Motorola did it, and how well Motorola is doing now.

    His theory conflicts a bit with reality, however. Specially with the fact that Apple always keeps price points and margins no matter what: Steve Jobs specifically and repeatedly said that Apple is all about giving more while keeping the same prices just a few days ago. Or the fact that demand has remained strong since the original iPhone introduction and the iPhone keeps selling like hot cakes, already beating the competition in revenue.

    Seriously I don't know what kind of pills the Wolfs and Munsters of this world pop in with their morning cereal, but I want a year supply. In the inmortal words of our very own Matt Buchanan: "These guys are talking out their rectums".

    Top New Blog- Blog for the top web news
     
  2. Jay2TheRescue

    Jay2TheRescue Resident Spamslayer
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    Yes, Motorola took a $600 phone and made it $100, (and eventually free) and then all of a sudden their entire product line was V3's or V3 variants. Their product line has grown stale, and now they are fighting to survive. It works in the short term, but just because you release a revolutionary device you can't just keep cranking out the same design forever.

    -Jay
     
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  3. Batteries4Less

    Batteries4Less New Member

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    I agree.

    Would be interesting to see how this effects the pricing on their Ipods as well...especially the touch.

    I don't understand the logic behind the move as it does not appear that the Iphone is struggling...but maybe I'm wrong. :confused:
     

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