Apple to generate 50% margin on iPhone?

I seem to remember reading that Apple won't release a product where they don't have something like at least 40% margins... I hardly expected the iPhone to be any different. I just hope the price comes down eventually - while I *really* want one, that's a LOT to pay for a phone, especially since I don't greatly care about its iPod functionality.

And is it just me, or does the discuss link always seem to switch between the top and the bottom of the article (that's to say, one in the summary about half the time)? Very confusing... tsk tsk.

IMO the iPod funktion is not good enough with a cap. of 8GB. My 30 GB is full to the top and i like the possebility(sp?) to hear whatever i feel like.
They should cut down the margin and upgrade the storage otherwise i wont buy one!

Why all this news coverage for one product? It feels like Bit's given into the engadget hype of it all really...

<A88>

It's quite sickening that Apple is royally kicking their fanbase in the teeth by charging this much for a product that REALLY isn't revolutionary at all. All they've done is put multi touch on a phone

Originally Posted by <A88>
Why all this news coverage for one product? It feels like Bit's given into the engadget hype of it all really...

<A88>

I can understand where you're coming from on that. But keep in mind that the iPhone really is the big release right now. We're not trying to copy engadget (or anyone else), but it's pretty much the news of the moment. ;) Believe me, we'll be just as thankful when everyone gets bored of it. But for the moment, most people actually left CES to daytrip to Macworld, if that tells you anything :p

Originally Posted by <A88>
Why all this news coverage for one product? It feels like Bit's given into the engadget hype of it all really...

<A88>

For the record, I'm not excited about the device at all - I think it's a passing fad. :)

Good to know we're on the same boat really, was just worried you'd all taken a ride with the ol' bandwagon for a second there ;). Still, I suppose it's what the people want to hear...

Originally Posted by <A88>
Why all this news coverage for one product? It feels like Bit's given into the engadget hype of it all really...

<A88>

because a good portion of the staffers are apple fanboys.

apple's charging for a software update on macbooks now, aparently. Wonder when that'll make it into the news http://www.dailytech.com/article.aspx?newsid=5780

gah.. the nokia series of phones is way better... or get the LG equivalent for less money

Maybe they're prepping for the money lost on the 2year R&D for the iPhone then ;) On a serious note, it's such a small value but what really is the point in charging users for something they've already (unknowingly unless they're tech-savvy) payed for? I hope a more reasonable explanation comes out because it seems a bit pointless if you ask me, not that I wouldn't pay it if I had an Apple (pigs have flyed...).

<A88>

I knew there was a trick.. See.. at least Mircosoft doesn't make us pay 50% more then the product costs them to make..

So, we pay 200$ extra for the phone, AND we have to pay for the phone service (duh), with added web browsing and text messaging and VoiceMail (you know Cingular will just be happy to charge a little extra for that *special* voicemail), AND if you want extra programs that don't come with it, you can buy them from Apple exclusively. Oh yea did I mention you also have to buy your Movies and Songs from Apple (exclusively most likely)?

Hah. I'll wait until Nokia brings out a kick-arse answer to the iPhone for half the price

"Margin" is a percentage of a sale that is above cost therefor a 50% margin = 100% markup.

Personally I find Apple's adds to be an insult to the intelligence of their fans. These margins just add to that insult.

I'm still waiting for my iGivacrap :D

LG version

But on the price point. Ive never ever liked Apples prices. Their technology looks stunning and it mesh's together effortlessly so i can certianly see the attraction. But knowing that there is a way to do that on my own and for a fraction of the cost just makes me take a step back.
Its just a shame that there isnt going to be a similar product out there that runs on Linux. That LG prada dosent have the quad band or the WiFi which is a shame. Also its more of a shame that it cost FAR more. But then it is a stand alone phone.

Originally Posted by antiHero
IMO the iPod funktion is not good enough with a cap. of 8GB. My 30 GB is full to the top and i like the possebility(sp?) to hear whatever i feel like.
They should cut down the margin and upgrade the storage otherwise i wont buy one!

You can bet on a hard drive-based version without phone functionality to be the 6G iPod, with plenty of storage. I've apparently used about 45GB of my 60GB 5G (which is ~56GB formatted). With Apple making plenty more movies available, as well as a 100GB 1.8" HDD being released recently, it's practically a given. Sounds like the latest rumor is that we'll see it as early as February (perhaps during a Super Bowl ad).

But Apple's stuff *works*, and I'm willing to pay a slight premium for that. I may not be able to equate my time to billable hours, but not putting up with constant frustration with crappy UIs and poor computer interfacing (syncing, etc) is worth something in my book. I was pretty miffed about the price premium like most other people are until I actually used their stuff, at which point I immediately questioned how I'd put up with Windows for so long.

DarkLord - don't know what you're on about. Anything that loads in iTunes will go on the iPhone. Which includes ripped CDs or any other MP3 content, as well as properly formatted video (h.264 640x480 or something, which quite a few apps will happily transcode to, or anything from Google Video, etc). You can just as easily fill it with DRM-infected Apple content as hand-ripped DRM-free content as *gasp* pirated content. Which goes for pretty much any portable player.

Yeah, I think it's a bit too expensive for what it is, especially considering the margin. But $500 for something that works seamlessly and reliably is worth it to me considering a $200 alternative that honestly sucks at everything in my experience.

My only hesitation - and a pretty big one at that - is the lack of open-ness in the platform. Sure, Jobs makes a good point in saying that the last thing you need is your phone crashing because of a crappy app, but bug testing against a single hardware set isn't especially difficult (relative to the limitless PC combinations, at least) and in my experience, Mac software is MUCH more reliable than PC software (for that same reason, I'd imagine), so I don't buy that. But I damn well expect the iPhone to be hacked open within a week so I could have a portable Newsfire (RSS), Cha-Ching (money management), or *gasp* Skype.

although 40% is high apple do make good products.
The revenue created by this is channeled back in to its products and development.
Although all phones these days have inbuilt MP3,camera,barcodescanners,kitchen sink.....
Some people will just buy it because it is apple and it has the imfamous i infront of its name.

I have to say it does look spangly though [but so does any phone when its been put through photoshop]

I don't believe that large margin... at least not yet.

Yes, the hárdware might cost about $250,-/280,-, but they forget the cost of manufacturing, the cost of developing the software, marketing and cost of the design itself.

Apple will probably see a nice margin, but I don't believe that they paid about 250 for the phone itself. The productioncosts will get lower in time due to cheaper materials and such (same as the iPod right?), but right now the overall costs of the iPhone will be a bit higher imho.

I want to see a phone with a built-in coffee machine.. First company that makes one.. I'm sold

Originally Posted by Tim S
For the record, I'm not excited about the device at all - I think it's a passing fad. :)

You da man then!

See? See?! Apple really is trying to play you all for fools! We're not crazy PC users! And those despicable Apple commercials, especially the new one for Vista, don't you have to update your Apple too when a newer version comes out of their OS? It's not like the processors go faster as they age.

All of you may as well take your trendy iBook, iPod, iPhone, iEtc. and go the nearest Starbucks in your favorite maroon sweater (or woman's suit), rectangle lensed glasses, and stay there forever

Coolest looking phone ever in my opinion, but I would never spend that much on a phone :/

Just skin your XDA