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One of the things people always forget is Apple's brand. The best place to see this exemplified is Ginza, Tokyo where the store is right next to Louis Vuitton, Prada, Chanel etc. It sees itself as a premium, fashionable brand.

Pricing it low would have the effect of short term financial gain but at the expense of commoditising the iPhone's brand. Which would make people far less willing to spend the extra money on the 5S (which has the larger margins).

Actually the '5C' is supposed to have the higher margins. Apple are pricing it more or less the same as the original '5' while benefiting from their integrated supply chain with known parts and on top, replacing the aluminum case with supposedly cheaper plastic parts. Albeit very high-grade polycarbonate, comparable to the Lumia line from Nokia. The '5S' has the much more expensive exterior parts, plus new chip designs inside as well as bigger camera sensor and TouchID parts. The 'C' will be raking in the profits for Apple.

That's one of the most interesting takes from this. Everyone was claiming cheap and they went for margin instead.

Apple always goes on margin. The extra memory versions of the iPhone are all margin.

When you get to the $850 iPhone with 64GB of memory, the profit margin is generally around 75%.

As in, it costs them $215 to make a $850 device.

Apple rarely dips below 40% margin on it's products it seems.

Now that Apple has over $100,000,000,000.00 in it's little hedge fund and has become the largest fund in the world (iirc), I've begun to look at the iPhone as the worlds most successful hedge fund capital raising scheme.

"Always" might be too extreme given the iPad Mini. Also, I would consider an upsell of the same model a different thing from the base price of different models.

If Apple can get China Telecom signed, do you think they'd offer the 5C at a lower price because of the volume? There's 700 million subscribers in that carrier.

Notice that Jobs didn't say "companies should always make rational profits and go for market share". Under Jobs, the first several generations of iPhone were exceptional for how much market share they left on the table by being exclusive to a single carrier in many major markets.

>I just looked at real world photos on Ars of the new models and from my POV the 5C models look like they are designed for kids.

That's a western male perspective. In Asia (including India), adults will jump to get those colors. (And women in the West too).

"In Asia (including India) adults will jump to get those colors" no they won't (due disclosure: Indian living in India).

They might 'jump to get' good value for money. The IPhones have never been seen as good value for money in the Indian market, and have truly miniscule market share. Bright colors won't help.

These kind of generalizations - emerging market customers are fools who can be bamboozled by bright colored cases and very expensive phones that are one generation (or more) behind the truly cutting edge phones - shows Apple is clueless about how to succeed in emerging markets. Which is ok - they can stick to America/Europe and make tonnes of money.

We'll see in a year or two if they can crack the Chinese markets, with these plastic phones. I doubt it somehow.

It is true that the color palletes of attractive hues vary by region. In part, this has to do with skin-tone. You can verify this by looking at Make-up for women (who understand this stuff), and compare trends on a global level. This is not withstanding the value for money argument, which is a valid (but disctinct) point.

All true. I was just pushing back against the idea that Indians will "jump to get" brightly colored cellphones. Color has next to no impact on the Indian cell phone (vs say cosmetics) market, which is very feature-comparison and value for money driven.

I think you think you called out sexism, but in actually, you have perpetuated it. PP shared his/her own opinion with no attempt or claim made to speak for other people.

Your contribution was to declare which opinions belong to each sexist grouping you architected. You have said, "Your opinion is a western male one," but I doubt you know PP's origin, so you are shooting in the dark.

You have said, "Asians are like _this_. Women are like _that_. Men are like _this_. Indians are _that_." That is prejudicial, and even worse, normative, behavior by you, compelling others to conform. If I were an Asian adult who didn't like the colors, your comments might make me feel hurt right now, whereas PP's comment was acceptable.

Or perhaps its a claim based on (perceived) statistical truths about the sorts of colors and designs various groups of people prefer.

And males in the West too. Heck, I like the white one.

> I just looked at real world photos on Ars of the new models and from my POV the 5C models look like they are designed for kids. (A matter of taste, of course.) If Apple cut the price by another $100 they might make sense as a pricepoint but at only $100 less than 5S it seems crazy to me.

I genuinely think this opinion might be the result of a filter bubble or its "real life" equivalent. I don't care for the bright colors personally, but I think the white 5c looks excellent (a black one would be even better). I still prefer the metal casing (plus the tech specs are important to me), so I'll choose the 5s if I decide to upgrade, but I can absolutely understand why a huge portion of potential buyers would prefer the plastic case, especially people who aren't particularly concerned with having the most blazing new chip or the fingerprint sensor. In fact, even among gadget geeks, I can see many choosing the plastic design specifically because it is plastic. I have heard a lot of disappointment about the fragility of metal iPhones since the debut of the iPhone 4.

If Apple cut the price by another $100 they might make sense as a pricepoint but at only $100 less than 5S it seems crazy to me

Conjecture: these will be the free-with-contract phones next year, and something else will occupy the $100 slot.

Sure, but that's still not a significant departure from Apple's current tiered pricing model.

He didnt really follow the essence of that quote with NeXT then, did he ? Which means, going for market share makes sense for some companies, but not for all of them. Imo competing in the lower end of the market isnt going to do them nor their brand much good. Their focus on the premium segment seems to still be the right directio to me.

I have 0 knowledge in business world and how things work but wasn't Jobs basically Apple itself? Even if he does not have single-handedly vote percentage to make things reality for Apple, his reputation is not enough to force things?

This quote is about the late 1980's, after Jobs had been forced out of Apple.

US$100 is a lot of money for a lot of people in other markets.

The difference is still minuscule. £549 vs £469 is insignificant, especially when you can get a Nexus 4 for twice that difference (£159).

where can you snag a nexus 4 for 159 pounds?

Google cut the price a couple of weeks back.

The 8GB N4 is £159. You can grab it from here https://play.google.com/store/devices/details/Nexus_4_8_GB?i...

On Google Play last week (the 8gb version), it has now sold out. The 16gb version is available for £199, which I bought two weeks ago and am thrilled with.

What you get for the price, best deal there is! Months ago, this phone was being offered for free on a 2 year contract. I paid $50 for mine 6 months ago.

Only thing I'm disappointed in is the camera, but that's why I have my Canon.

On the other hand doesn't the stereotypical iphone owner in the USA currently write a check well over $100 per month? I'm not talking about "extreme measures" but the more typical grannie walks in off the street and walks out with a phone?

This seems to be a problem. Hmm buy the inferior product, or spend a mere 3 weeks service to buy the top of the line. Duh I'll buy the top of the line. If I wanted to save money I'd just get an android phone from Republic Wireless for $19 like VLM did on Hacker News (I'm a happy customer). Therefore since I'm already contemplating the 2nd most expensive option out there, and possibly the 2nd best option out there, may as well pay a tiny bit more for the best one.

If I want to blow $30 on an expensive bottle of wine, there's no way in hell I'm paying $31 for an inferior bottle sitting next to a superior $32 bottle. If I wanted to save money I wouldn't participate in that market anyway.

And that is the marketing plan I think they're using. I don't think they'll sell any of the cheaper ones.

I think kids on family plans are the target market for this. It's a $99 contract iPhone that comes in colors - I think it's more of a replacement to the iPod touch. When buying multiple devices for children the savings make more of a difference.

I concur. My niece who just started high school (and many of her friends) are very excited about the 5C. The funny thing was an erroneous statement I heard from my niece: "iPhone 5C is the cheap phone .. only $100. The iPhone 5S is the expensive one ... over $700". I had to explain contracts and why the 5S is only $200 with a contract, which is the comparable number to $100 for the 5C price. I wonder what clever kid came up with the erroneous statement to get his parents to buy her/him a 5C!

More of a difference, but still not much. I add $40/mo ($10 for the line, $30 for the data) to my parents' Verizon family plan.

iPhone 5S: $1,160 over two years iPhone 5C: $1,060 over two years

True, but have 2 or 3 kids and it's more expensive up front. I also don't think people really extrapolate out the price when buying phones (although I wish they did, might help with the telco monopoly)

I pay 62$ a month for my iPhone through AT&T and I am still on the original unlimited data plan so I think that can be dropped below 50$ a month.

How does that work? This is exactly what I was writing about WRT no extreme measures and "grandma walks into store and walks out with phone". No grandfathered plans, no work discounts, just joe6pack price.

I go to ATT.com, click on wireless and the cheapest contract voice is $40/month and the cheapest data is $20/month and I'm continually informed I'm the only living human being who doesn't text, so thats another $20/month plus taxes. So thats $80/month for the absolute minimum. 300 megs of data a month? Really? I don't think you could keep up with app updates alone much less actually "do" anything with only 300 megs/month. So you're more realistically $90 for 3 gigs or $110 for 5 gigs, before taxes of course.

I have a 384 mb data plan (USD 5/month here in Uruguay), and it mostly works for my use case (mail, browsing & maps).

I only download or update apps on my home Wifi connection though, and I use Opera browser which does a lot of caching.

BTW I'm still amazed at the incredibly expensive plans in the U.S. (there are lots of threads here with comparisons, and the U.S. is among the most expensive). I pay USD 20/month for my contract (voice + SMS, and we don't pay for incoming calls, caller pays) plus USD 5 per 384 megabytes.

Edit: link to one of the previous discussions

https://news.ycombinator.com/item?id=4342617

Grandma probably doesn't text and won't use much data. Some members on my family plan use < 100MB/mo.

More realistically, she already has a plan with a monthly payment. Which she is not even considering at this point. All she cares is how much it will cost her right now. $100 could make a difference.

> I don't think you could keep up with app updates alone much less actually "do" anything with only 300 megs/month.

You probably don't want to have automatic over the air app updates enabled. In fact, I'm not even sure if that's an option. Honestly, 300 MB/month would be sufficient for most months even for me, and I'm a fairly heavy user on LTE. I pay for the 2GB plan mostly to cover months where my usage peaks. I suspect that 8 months a year I use less than 300 MB/month, and I use iTunes Match, occasional video streaming, and occasional Facetime calls.