One of the announcements I failed to report last night was that Apple decided to drop the price of the iPhone by $200. Unfortunately, upon release about a million people bought the same phone for $599 and are now left $200 short. While I can fully understand Apple’s reasons for dropping the price (there’s no way they can compete with better smartphones while their own phone costs a whole lot more, meaning they can only depend on fanbois to a degree). The hate mail has been piling in since this announcement from angry customers who paid way more than they should have for this phone. The only thing Apple can really do at this point to appease their loyal customers (remember the lines of people waiting to get into Apple on the release date for the iPhone?) is to give anyone with a phone a $200 rebate. Of course, Apple has to keep their stockholders happy. If they do anything at all, they’ll end up giving these people $200 in Apple gift cards (or they can be real jerks and just give them iTunes gift cards and let people buy up their crappy compressed DRM’d music).
Regardless of what happens, Apple is in a bind… appease their loyal customers or keep stockholders happy. It seems to me that this might’ve been planned from the get go. They knew that people would buy the phone for $599, so they sold it. They also knew that the interest in the phone would drop really quickly after the initial release because of that ridiculous price tag. My theory is that they released the phone selling for as much as they thought they could get at the time, and then drop the price when sales started to dwindle and they made some other announcement. I expect that they figured their fans to be blind idiots who think everything that Steve Jobs does is infallible. They figured wrong.
Business 2.0 has a pretty good blog post about this. My opinion… the original iPhone adopters are rightfully pissed.
UPDATE: According to CNN, Apple’s stock dropped more than 5% after the announcement. The story is here.
UPDATE #2: Apparently, Apple is doing sorta what I had expected, only worse… they’re giving anyone who bought it over 2 weeks ago (those who bought it less 2 weeks ago can get a $200 rebate, those who still have it in the package and bought it less than 2 weeks ago can return it outright) a… get this… it’s a doozie… $100 Apple store credit! WOO HOO!!! Stevie-boy says he’s making things right with his “valued” iPhone customers. Making it right would be giving them all back $200 cash. Not only is this not cash, but it’s not even $200! Open Letter from Steve Jobs to iPhone Customer
Business 2.0 updated their post.