Apple iPhone 4S visits another chop shop, $188 Bill of Materials estimated
1. sorcio46 (Posts: 402; Member since: 27 Jul 2011)
so... we'll have a mid-range Price at reseller ? Absolutely no !!! Cause it is Apple :D. In France iPhone 4S from 629€, Galaxy S2 From 400/425€ !
2. roldefol (Posts: 2999; Member since: 28 Jan 2011)
Just as I thought. You pay $100 for $19 worth of extra memory, or $200 for an extra $58 worth. Anyone who buys the 32 or 64 GB unit: you have officially been fleeced.
3. Snapdude (Posts: 128; Member since: 27 Aug 2009)
its sad how bad they rape you on the retail price of the phone these days... but marketing hpays off to those who do it well i.e. apple
29. biggles (Posts: 213; Member since: 15 Oct 2009)
No, what's sad is that the 15 month old iPhone 4 was the same price as it was on launch day, a week before the 4s came out.
26. ardent1 (Posts: 1997; Member since: 16 Apr 2011)
Let's use the itouch as an example. Remember, if you buy it from Apple either online or via their stores, then yes Apple has a high markup. But when you buy from say Costco, the MSRP argument doesn't apply. Apple sold to Costco at a sizeable discount such that Costco were discounting the itouch's from the getgo. I bought 3 itouch 4G when they came out, and it was at least $20 off list price. Not to mean the iTunes cards were about 15% off list price. I miss those days.
As for the phones, they are being subsidized by the carriers.
28. ardent1 (Posts: 1997; Member since: 16 Apr 2011)
The Android OEMs are doing the exact things for the tablets. Apple is not exactly without sin.
4. jenulad (Posts: 11; Member since: 20 Sep 2011)
The price is not just based on the Hardware Components alone. It includes software+support+R&D+Marketing or Advertising Cost+ retailer margin+taxes and ofcourse their BRAND VALUE all sums up to Retail price of the product.
5. Snapdude (Posts: 128; Member since: 27 Aug 2009)
all of that combined does not add up to the 600 ASP they get for their devices, a 400 ASP would make up for all extra expenses... 600+ is just rape, plain and simple
6. roldefol (Posts: 2999; Member since: 28 Jan 2011)
That's fine for the base 16 GB model, and true of any phone. But you can't possibly include R&D, marketing, software etc. in the extra $100-200 price of the 32 GB or 64 GB. That's nothing but markup.
32. SpyDoorMan (Posts: 10; Member since: 05 Oct 2011)
is the HYPE before the announcement included on the + $100-200 price? :)
7. moofoodooloo (Posts: 137; Member since: 04 Jan 2011)
We can speculate until we are blue in the face about exactly how much Apple is pocketing per iPhone, but the fact of the matter is we really don't know and all of this is pure speculation. I think people are really undermining how much Apple really pays for R&D, manufacturing, and the big one: marketing.
8. Snapdude (Posts: 128; Member since: 27 Aug 2009)
no matter how you try to explain it 600+ ASP is not needed for a sub-200 dollar device
9. taco50 (banned) (Posts: 5506; Member since: 08 Oct 2009)
Well the consumer only pays $200. It's the cell companies that are paying the rest. Anyway Apple has never been cheap. If you want cheap you don't go with Apple.
11. Snapdude (Posts: 128; Member since: 27 Aug 2009)
the concumer still pays the entire price with the price of the contract... no way they carriers are gonna lose money... higher phone price = higher plan prices
14. taco50 (banned) (Posts: 5506; Member since: 08 Oct 2009)
The consumer pays the same price over the life of the contract regardless if it's Apple or another type of smartphone.
16. roldefol (Posts: 2999; Member since: 28 Jan 2011)
And this warrants a downthumb...why? Oh, right, because we don't like taco, even when he's just stating a simple fact.
15. bossmt_2 (Posts: 436; Member since: 13 Oct 2009)
The Consumer pays for that in a locked in contract. You can't buy a new iPhone for 200 bucks on the same number every month.
This isn't new though, this is right around the cost of the iPhone 4, more than the price of the 3GS.
The problem that hits a lot of consumers is that the lack of profit from Apple, gets spilled to non-apple products all too often. For example the Moto Droid had a higher cost to build than the iPhone 4, and came out what 8 months earlier? But has the same contract cost, and a lower (IIRC) retail price.
Also what everyone needs to remember as well is that retail price, is not what Verizon, AT&T or whoever pays for it, usually it's around 80% of that is what they pay. Companies want to make money off of retail or get additional contracts.
20. taco50 (banned) (Posts: 5506; Member since: 08 Oct 2009)
Before the iPhone smartphones were sold for $300-$400. The iPhone and AT&T dropped the standard price to $199 for a high end smartphone. In this case Apple has actually helped the consumer.
I don't understand your argument. The moto droid wasn't as profitable? That doesn't affect the consumer negatively. They needed to match the iPhones price to compete.
27. ardent1 (Posts: 1997; Member since: 16 Apr 2011)
Brand new in the box Android phones without contracts are now going for less than $100. Virgin Mobile has two such phones.
If this trend continues, you might get those phones for less than $80 or $70 based on the way Virgin blows out its old inventory.
30. biggles (Posts: 213; Member since: 15 Oct 2009)
And they're subsidizing it with your expensive data premiums on a 2 year contract, so it really trickles down to the consumer no matter how you look at it.
10. moofoodooloo (Posts: 137; Member since: 04 Jan 2011)
It isn't a $200 device. Just because the BOM is that price, doesn't mean thats all that Apple has invested into these devices. These aren't Nike's.
17. roldefol (Posts: 2999; Member since: 28 Jan 2011)
Most of Verizon's LTE phones are $550-600 full price, and some of them are using old tech. Let's not kid ourselves, this isn't exclusive to Apple.
18. Snapdude (Posts: 128; Member since: 27 Aug 2009)
your absolutely right, 600+ ASP is not cool by any means, but with a phone that is sub-200 to build? rediculous
21. taco50 (banned) (Posts: 5506; Member since: 08 Oct 2009)
Again there's a lot more costs that go into building a phone besides cost of parts.
22. Snapdude (Posts: 128; Member since: 27 Aug 2009)
no matter what way you put it, 600 ASP is not justified... 400 would more than cover all other costs associated with R+D and marketing with this device
23. taco50 (banned) (Posts: 5506; Member since: 08 Oct 2009)
Even android phones retail at $500-$600. Why should an iPhone be priced cheaper than androids when it has roughly the same specs.
Also what business drops their price just because cushy would they sell it for less when it's selling great now?
24. Snapdude (Posts: 128; Member since: 27 Aug 2009)
im not saying they should stop because you are right in saying that they will sell anyway and after all apple is a business not a charity. what i was pointing out was the disparity between actual cost (sub-200 including R+D and marketing 400) and msrp (600+) some of those android devices have BOMs upwards of 300+ justifying a 500ASP and some windows phones are close to the 400 manufacturing cost mark! and they still retail for less than apple.... just trying to make a point
31. biggles (Posts: 213; Member since: 15 Oct 2009)
Price fixing is exclusive to Apple. MSRP's and wholesale costs for smartphones typically drop over time which is reflected in the lowering of advertised contract pricing. Notice that NEVER happens with Apple products until the next unit is out. And BTW, those same LTE phones are $650-$700 full price from third party retailers, so Verizon is actually reducing the full price cost to direct customers.
33. roscuthiii (Posts: 1843; Member since: 18 Jul 2010)
R&D? Apple spends 3% on it, and that I believe is divided up between all of its products. 3% R&D spending across the board.
13. Cyd07 (Posts: 83; Member since: 03 Oct 2011)
Rape ? RAPE ?!? Do you have any idea what a rape is ?
Everybody knows that an Iphone is hyper expensive, absolutely and relatively to its cost. What's the problem ? Do you think people think they pay just component's price ? It's a gadget like every other smartphone, so what's the problem ? You don't want, you don't buy (and be sure I don't want neither).
19. InspectorGadget80 (Posts: 6588; Member since: 26 Mar 2011)
And 1 million Iphone 4S can't activate
25. freeze (Posts: 1; Member since: 20 Oct 2011)
why are you all saying 600 dollars is not justified? what does it mean for a profit margin to be justified? is selling $10 jeans from A&F for $100 justified or jordan shoes for $150 when they are just canvas+plastic?
the only "unjustified" part is that apple phones get higher subsidies than android ones but we all know why that happens...