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Daring Fireball: Apple's Pricing Advantage

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Re: Daring Fireball: Apple's Pricing Advantage

#31

Post by andreyf »

nowarninglabel wrote: post #11

The 2nd paragraph: "Now, even putting quality aside, competitors can’t match Apple’s prices." Does not jive with the prices mentioned later: Apple Ipad - $599/$699 for the 16/32 GB models Samsung Galaxy S - $594 HTC A8181 Desire - $527 I don't know what the author's definition of "match" is, but seems to me Android tablet makers have matched prices quite well. *Edit: fixed my formatting

He's talking about cost of actually building the device. A big part of the iPhone's consumer price ($700 for 32gig) is markup, as he points out in comparing it to the price of the iPod touch, which is $300 for a comprable model.

In other words, he's claiming that Apple could undercut the A8181 Desire or the Galaxy S on price, but keeping the customer choose between "FREE* shiny new phone" or "$200* shiny new phone" reinforces the perception of Apple as a premium brand.

* with 2 year contract

Re: Daring Fireball: Apple's Pricing Advantage

#32

Post by icegreentea »

cheald wrote: post #18
_delirium wrote: post #2

I've noticed this even with normal laptops at the smaller end. If you're looking for a 15" laptop, you can find a lot cheaper PCs than the $1,799 MacBook Pro. But if you're looking for a 13" laptop with roughly equivalent processing power and weight, it's hard to find a PC laptop much cheaper than the $1,099 MacBook or $1,199 MacBook Pro. Some are considerably more, because while Apple prices the 13" at the bottom of…

Having just recently priced laptops, I didn't have this experience. A 13" MBP is $1200 for the bare-bones options (4GB RAM, Core 2 Duo, 250GB 5400 RPM SATA). It weighs about 4.5 lbs. They want an additional $400 for an extra 4GB of RAM (wtf?) A Dell Inspiron 14" with the same specs clocks in at $665 at 4.9 lbs (which is still under the 5lb "ultraportable" mark). A Lenovo U350 with similar specs clocks in at $700 and…

But if you move up to Dells and Lenovo's "premiere" laptops (Latitudes and Thinkpads), then the price difference narrows considerably. Bare bottom T410 (14") is ~1200 (granted, its currently on sale for like 700-800 dollars... Lenovo has a lot of sales actually).

I think it's fair to say that MBPs compete with all of the other brands "one step up" or business lines. MBP build quality alone lets it fight in that category.

Re: Daring Fireball: Apple's Pricing Advantage

#33

Post by trotsky »

irons wrote: post #19
trotsky wrote: post #6

I see daring fireball has never heard of archos. http://www.engadget.com/2010/08/31/archos-unleashes-five-fiv...

Any "Android tablet" lacking Market access, as these do, might be competition for the iPod nano, or the Nook, but it's not in the same space as the iPod touch.

The claim of the article is that apple can price their mobile devices lower than the competition because they benefit from superior supply chains and manufacturing. The fact that google chooses to restrict the market application to OHA member devices with SIM cards doesn't change the fact that archos is delivering products in the same basic hardware class for less money.

Re: Daring Fireball: Apple's Pricing Advantage

#34

Post by rimantas »

protomyth wrote: post #28
ugh wrote: post #21

Earlier quoted context omitted.

I would very much like to know how exactly they can be so cheap. Their 10" tablet will sell for $350 (16GB), the spec-wise very similar 16GB iPad costs $150 more. (The one downside is that you cannot buy it yet, it’s supposed to be out “this fall”.) Oh, and if Archos can do that, why not Samsung?

Well, not shipping and the resolution on the screen is worse (1024 x 600).

iPad also has IPS screen that should cost some.

Re: Daring Fireball: Apple's Pricing Advantage

#35

Post by cheald »

icegreentea wrote: post #32
cheald wrote: post #18

Earlier quoted context omitted.

Having just recently priced laptops, I didn't have this experience. A 13" MBP is $1200 for the bare-bones options (4GB RAM, Core 2 Duo, 250GB 5400 RPM SATA). It weighs about 4.5 lbs. They want an additional $400 for an extra 4GB of RAM (wtf?) A Dell Inspiron 14" with the same specs clocks in at $665 at 4.9 lbs (which is still under the 5lb "ultraportable" mark). A Lenovo U350 with similar specs clocks in at $700 and…

But if you move up to Dells and Lenovo's "premiere" laptops (Latitudes and Thinkpads), then the price difference narrows considerably. Bare bottom T410 (14") is ~1200 (granted, its currently on sale for like 700-800 dollars... Lenovo has a lot of sales actually). I think it's fair to say that MBPs compete with all of the other brands "one step up" or business lines. MBP build quality alone lets it fight in that categ…

At some point, you're paying a few hundred extra for the aluminum body and glowy Apple logo - it's not just about "premium" versus "consumer" tiers of hardware.

A Latitude 5400 (again, same hardware loadout) prices on Dell's website right now at $849.00. A ThinkPad Edge 13", again, similar loadout, prices at $694.00.

Apple makes fantastic hardware, no doubt, but it's very difficult to consider them to be competitively priced. For the price I'd pay for a MBP, I can get a machine a generation ahead in terms of raw horsepower. I just got an HP Envy 17 (I wanted a portable workstation, rather than a ultralight) and it's a hell of a lot of hardware (Core i7, 8GB RAM, 750GB 7200 RPM HDD) for roughly half the price of an equivalent MBP.

Re: Daring Fireball: Apple's Pricing Advantage

#36

Post by andreyf »

trotsky wrote: post #6

I see daring fireball has never heard of archos. http://www.engadget.com/2010/08/31/archos-unleashes-five-fiv...

A theory: Archos has obviously created prototypes to send to the press, but it doesn't look like they're pulling off mass manufacturing at the advertise prices just yet (except the Archos 5, which has a resistive screen). Could it be that the prices quoted are simply an over-ambitious projection?

Re: Daring Fireball: Apple's Pricing Advantage

#37

Post by ary »

trotsky wrote: post #26
ary wrote: post #14

Earlier quoted context omitted.

It's difficult to know exactly which point in the article you take issue with. I didn't see anything that indicated Gruber is unaware of the Archos.

various quotes: Now, even putting quality aside, competitors can’t match Apple’s prices. no one else can afford to match the iPad’s price with a comparably sized touchscreen display iPods, iPhones, iPads. Across all of them, Apple’s prices are either comparable, or lower, than their competition.

Now, even putting quality aside, competitors can’t match Apple’s prices.

The only Archos device that is shipping and comparable to an Apple product (the iPad) is this: http://www.engadget.com/2010/11/02/archos-70-internet-tablet...

This is not something that can be easily compared to the iPad. Yes it is cheaper, but the two devices aren't the same. The three biggest (and easily measured) differences are the screen size, screen resolution, and storage. I can't find a price for the Achos 10.1, but please feel free to link it if you have it.

no one else can afford to match the iPad’s price with a comparably sized touchscreen display

See above and below.

iPods, iPhones, iPads. Across all of them, Apple’s prices are either comparable, or lower, than their competition.

The other Archos devices available for sale are indeed cheaper, but also fail to have comparable specs to the Apple devices.

Re: Daring Fireball: Apple's Pricing Advantage

#38

Post by irons »

trotsky wrote: post #33
irons wrote: post #19

Earlier quoted context omitted.

Any "Android tablet" lacking Market access, as these do, might be competition for the iPod nano, or the Nook, but it's not in the same space as the iPod touch.

The claim of the article is that apple can price their mobile devices lower than the competition because they benefit from superior supply chains and manufacturing. The fact that google chooses to restrict the market application to OHA member devices with SIM cards doesn't change the fact that archos is delivering products in the same basic hardware class for less money.

You're accusing Gruber of ignoring certain competitive products which, by your own admission, aren't competitive products. The Nook is also in the "same basic hardware class for less money."

Re: Daring Fireball: Apple's Pricing Advantage

#39

Post by ojbyrne »

arron61 wrote: post #24
alanthonyc wrote: post #15

Earlier quoted context omitted.

7" screens vs. 10" screens?

7" vs 10" screens but failedl to mention that the Galaxy Tab also has dual cameras, a GPS chip, a cellular chip, and etc - things not seen on the ipad. I think the Tab could have been priced lower but Samsung wanted to see if they could technically compete with the ipad at the same price point first. And if things don't go well, reduce the prices later. Why shoot yourself in the foot to begin with? And additionally w…

The (admittedly more expensive) 3G ipad has both a cellular and a GPS chip. $629/$729 for 16/32 gigs.

Re: Daring Fireball: Apple's Pricing Advantage

#40

Post by kemiller »

protomyth wrote: post #27
kemiller wrote: post #12

Another factor here is that mobile devices are all a tier or two down from personal computers in terms of the raw number of dollars. Seems like a 15% premium is something people will consider paying if it only amounts to $30, but might not if it's $300. This was especially true in the early days of the PC revolution. The Mac 128K sold for $2495 at the time, which is more than $5000 in today's dollars[1]. I can't find…

Cost isn't everything, even in 1984. The PC wasn't the price leader of the era, check the market share and price of a C64.

No, but it was arguably price-performance leader, which the Mac, in raw terms, decidedly was not. I guess the other piece at the beginning was the IBM brand, but that wasn't enough to make it take off like a rocket.
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