“Apple has good reason to be gearing up [iPhone] for this holiday season based upon its experience with the iPod. Steve Jobs made an incredibly gutsy call last year in the spring when he told manufacturing to gear up to make more than 20 million iPods to sell over the holidays. Why was it gutsy? Because Apple had never sold more than 14 million iPods in a quarter before. Yet the decision had to be made, and Jobs and his team made it. And it is sounding like Jobs has recently made that same decision with the iPhone by doubling iPhone production for this holiday season too,” Carl Howe writes for Blackfriars’ Marketing.
“So with production ramped up for the holidays, is Apple going to [lower and lower iPhone prices and] follow Motorola into the downward price spiral of death?” Howe asks.
“Oh sure. And it will happen right after Steve Jobs attends an ice skating party in hell with bad Muzak,” Howe writes.
“What people don’t get is that Apple is waging a marketing war to reshape the value chain for the mobile phone industry… By bundling ‘free’ and generic phones with cell phone service, mobile carriers have devalued both the brand values of the handset makers and their own services… Because Apple is providing valuable carrier differentiation, Apple can then capture the subsidy revenue stream that the carrier would have normally paid to the handset manufacturers anyway for ‘free’ (and undesirable) phones,” Howe explains.
“So Apple is going to use its iPod playbook all over again. The original 5 gigabyte iPod went on sale for $399 in 2001. Today, a 16 gigabyte iPod touch sells for — you guessed it — $399,” Howe writes. “A constant set of features will move down the price scale to more value-oriented price points, but Apple will introduce new and even more desirable products at the old price points. And so long as it can keep that engine going, it will make money hand over fist.”
Much more in the full article – highly recommended – here.
[Thanks to MacDailyNews Reader “Linux Guy And Mac Prodigal Son” for the heads up.]
Or is it Fist over hand?
They truly are brilliant in their strategery.
Enough about the iPhone; give us a Leopard release date.
Since I invented the iPhone (along with the internet), I predict that sales will “warm globally” for the Holiday season…
I don’t care about fists, or the thing that makes it. I just wanna enjoy what looks like massive renaissance of all things Apple, those nincompoops who thought Apple had gone 10 years ago are going or will soon be gone themselves
I for one things the iPhone sticky price point will stick and they will go down market with cheaper versions. Its a truly remarkable product, those who don’t like it frankly either haven’t used it or don’t like AT&T;. That is the achilles heel here, the carrier.
-sammy
“Enough about the iPhone; give us a Leopard release date.”
What kind of cheese do you prefer?
Carrier differentiation? They have gone with multiple carriers in different countries so where is the differentiation?
Also, iPods are full of ripped music – iPhone costs a big $$$ comitment with phone cos.
Apple have made a wrong turn.
The writer lost any creditability with me when he mentioned he was discussing this with Wired News. Brilliant iPhone strategy??!! Gimme a break. It might have been brilliant if it had been opened up to 3rd party apps. Until then it will always remain just a few applications short of being truly great.
Re: John
“Apple is providing valuable carrier differentiation,”
What this means is that Apple helps a single carrier differentiate itself from OTHER carriers. So a carrier no longer be the cheapest (which means it can make more $) if it has something special everyone “has” to have.
Get it?
@R
Apple has been saying October ’07 for the past 1/2 year. It’s only September. Hold off the “Where is Leopard” comments for another few weeks.
Way to repeat the Big Lie. The real Al Gore never claimed to invent the internet. He claimed to cosponsor legislation that resulted in what we call the internet.
The original iPod 5gb was first on sale for $499. Not $399. Same went for the first 10gb (which the 5gb then became $399) and 20gb iPods(which then dropped the price of the subsequent iPods to $399 and $299.) I am not exactly sure when Apple officially dropped the price point of the newest iPods that were out from $499. to $399 though.
Gutsy iPhone strategy? More like stupid.
Hey Apple, isn’t it bad enough Microsoft’s magnificent Vista will finally kill the MAC business? Now in a final, desperate and futile act you’re entering the smartphone business which is phenomenally establised by fantastic Windows Mobile phone. All that’s left is the iPod business and we all know how that ends: Zune. Nice try, Apple.
Your potential. Our passion.™
Believe it or not, I saw a Zune for the first time (in person) at Best Buy the other day.
It was lined up next to the new set of iPods…
It looked horribly out of place. Who would choose a Zune over any iPod? That’s just silly.
Well besides Zung Tang, who buys these things?
finally got the iPhone after holding out on smartphones (well I did buy two Moto Q’s that we used for all of two weeks last year)
well hoo boy…Apple nailed it with iPhone…I know it will get even better, but it doesn’t have to. Simply excellent and surpassed my expectations. Getting one for my son next.
I know Zung Tang’s “not for real”, but if there really are zealots who think Vista is the end-all of OSs, I’d think the dissolusionment should be seriously setting in by now.
if Mr. Gore were smart he would have said… “yes, I helped to make the internet possible for you to use today.” instead of apologetic dribble.
my 2¢
MW – “standard” He set a standard…
RE: “I know Zung Tang’s “not for real”, but if there really are zealots who think Vista is the end-all of OSs, I’d think the dissolusionment should be seriously setting in by now.”
So true. Just yesterday an assistant teacher of mine, after having seen my Macbook for a month, bought some brand of laptop for $699 with Vista. It won’t get past the boot process.
I paid about $900 for my Macbook with an educational discount.
The $699 Windows laptop is just too expensive.
Zune Tang isn’t for real?
Speaking of Zunes. Microsoft made an announcement that it expected to sell the millionth Zune in June. Then, nothing. They have not announced the millionth Zune, no met target, nothing.
I know that there are two Zunes due out for the fall. One a flash player, sort of like the nana (old edition, aint it great.
” width=”19″ height=”19″ alt=”grin” style=”border:0;” /> ) and a bigger 80 gig edition. Both are said to be designed by Microsoft owned engineers.
en
Zunes may be off to a slow start, but by X-mas buying season everyone will be dumping iPods for Zunes.
Here is the actual quote “During my service in the United States Congress, I took the initiative in creating the Internet.”
The way he said it, leads one to understand that Al Gore intended his audience to believe that he created the internet.
Microsoft announced they had shipped 1.2 million Zunes in many colors including red and pink.
But, you are right, they never did announce that 1 million Zunes had been sold.
Shouldn’t there be a colon after gutsy?