Tag Archives: Gadgets

Apple feels backlash from iPhone price drop

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.

So Apple announced some new stuff today…

If you’ve been in a bubble today, at least in the technological sense, you wouldn’t have heard this, but Apple announced 3 new iPods today. I’ve said it before on here and I’ll say it again, I can’t stand fanbois. I am certain not one for anything (unless you count Phish, though they are certain not infallible like some people consider Steve Jobs and Apple).

The first “new” product is an upgrade to the iPod Nano line. It gets a bigger screen, the ability to play videos and comes in 8 GB or 16 GB flash memory. I don’t fully trust flash memory just yet. I’ve seen too many USB flash drives fail after many write/format cycles. I’ve also seen lots of people with iPod Shuffles that have died (both the original stick shaped one and the new square one). I have also known people with issues with their iPod Nanos. So I’m not sure that increasing the capacity of them would be such a great idea, especially since I know that it takes more power (and really, who needs 16 GB of music on them all the time?).

The next “new” product is a new iPod Classic. It’s a hard drive model and comes in up to 160 GB. My thought on this is that Apple is just trying to win people over by saying “we have a 160 GB portable music player” when no one will ever have a need for that. The only good thing about it is that it brought the prices down on the other models.

Finally, they released the iPod Touch, which is similar to the iPhone with a touch screen (for all the people who didn’t want to switch to AT&T to get an iPod/Phone/wannabe smartphone). It also has Wi-Fi capability, probably because they were getting pressure as Microsoft already had that in their Zune.

Now, my thoughts on all this… who cares? I have an iPod Mini that someone lost and I picked up (though I did try to find the owner). I wouldn’t have one otherwise. I don’t use portable music players and haven’t since I stopped taking the bus to high school (back then, we had discmen). If I were to own a portable digital music player, it’d be something that was a bit more “open” than the iPod. I am not a fan of the iTunes Music Store, nor am I a fan of the fact that Apple won’t license their DRM to other vendors (like MS did with Plays-for-Sure, even if they didn’t make the Zune compatible with it). I just don’t like DRM (as you can see by my nice Defective by Design banner/button on the right sidebar). Because of that, I won’t buy an iPod or songs from iTunes. In addition to not liking DRM, I also don’t like the low quality of the compressed music files. You might say you can’t tell the difference, but I can, even on my cheap Aiwa bookshelf stereo (I’d probably also notice the difference on an iPod with a pair of halfway decent headphones, unlike the ones included with the thing).

So after all this, I might sound like I don’t like Apple. That’s only partially true. I don’t like Apple because Steve Jobs has had every opportunity to rid iTunes music completely of DRM (or at least to license the code to other media player manufacturers). However, Steve-o likes his litte iTunes/iPod lock-in. Do you blame him? No one looks at Apple the same way they look at Microsoft in the eyes of the anti-trust laws, though Apple has a borderline monopoly on online digital music sales and portable music devices. The reason for this? Because all those DRM’d songs you bought off iTunes can’t be moved to a device that is not an iPod. I don’t like being locked into a single device like that. It’s anti-competitive. I liked Apple’s computers when they were still using the PowerPC processors and I had hoped they’d lower their prices when they switched to Intel. That didn’t happen. Instead, they got sloppy with their hardware. I like MacOS X. I like it a lot. However, I don’t like it to the point where I’ll spend extra money on a computer with the same hardware in a machine I can get for at the very least a few hundred dollars less than the nice shiny Apple because it has a picture of a bitten Apple on it. I don’t like the Apple locks OS X users into using their hardware. I’m all about openness. Sure, I use Windows and it’s definitely not the most open operating system in existence, but neither is anything that Apple releases (and besides, eventually I’ll have installed Ubuntu Linux on my machine here, but I just need a bit more time to myself when work isn’t as crazy).

That’s the end of my rant. Apple announced some shiny new stuff. The fanbois drooled, while the realists rolled their eyes.

There’s some decent comments on the BoingBoing Gadgets posting regarding the announcement.