AAPL - Apple Inc.

[Palantir]

if it's "high end" how come I can get the same "experience" with my $220 smartphone that I can with a $645 iphone? this is a faddish business. bbry can attest to that.

 

Except you can't get the same experience with your $220 smartphone, just like you can't get the same experience with your Nexus 7 v iPad Mini. Apple's industrial design is far superior, their fit and finish is better, their software is simple, well thought out and fun to use. It just looks and feels great. The first time I saw a MBA up close (at my dr's office), it was like "WHOA that's sleek". Couldn't justify paying $500 more for that, but I'm not really their target customer.  ;D

[Guest wellmont]

I think a larger handset would fit well into Apple's high-end product strategy - not because a larger phone is better, but, not so much Android, but rather Galaxy is the rival within the high end market, and a 4.8 inch phone would seriously hurt the GS4/5, and give Apple another excuse to sell something for a lot of money. Maybe 4.5 inches is a good compromise.

 

iPhone Mini (3.5 inch) - 450

iPhone 5/6C (4 inch) - 550

iPhone 6 (4.5-4.8 inch) - 650

 

lol at $450 for a 3.5in phone. is that the BMW mini?

[Palantir]

lol at $450 for a 3.5in phone. is that the BMW mini?

 

What is there to lol about, you realize they've been charging 450 for a 3.5 inch phone both last year and will continue to do it this year?

[Liberty]

if it's "high end" how come I can get the same "experience" with my $220 smartphone that I can with a $645 iphone? this is a faddish business. bbry can attest to that.

 

Except you can't get the same experience with your $220 smartphone, just like you can't get the same experience with your Nexus 7 v iPad Mini. Apple's industrial design is far superior, their fit and finish is better, their software is simple, well thought out and fun to use. It just looks and feels great. The first time I saw a MBA up close (at my dr's office), it was like "WHOA that's sleek". Couldn't justify paying $500 more for that, but I'm not really their target customer.  ;D

 

That's what I was saying earlier. Not everybody sees the difference, and that's fine. Some people care about quality kitchen knives and notice the difference, while others use cheap knives that have never been sharpened. Apple can't force people to notice quality, which is why they'll never have the huge market share that some would like to see them have. Why? Because people who can't see quality won't pay for it, and it's just not worth chasing those people.

[Guest wellmont]

if it's "high end" how come I can get the same "experience" with my $220 smartphone that I can with a $645 iphone? this is a faddish business. bbry can attest to that.

 

Except you can't get the same experience with your $220 smartphone, just like you can't get the same experience with your Nexus 7 v iPad Mini. Apple's industrial design is far superior, their fit and finish is better, their software is simple, well thought out and fun to use. It just looks and feels great. The first time I saw a MBA up close (at my dr's office), it was like "WHOA that's sleek". Couldn't justify paying $500 more for that, but I'm not really their target customer.  ;D

 

actually in some ways I get a better experience (maps gmail etc). be that as it may, what you're talking about is something quite elusive---wow factor, it factor, status factor. hard to maintain for makers of gadgets which undergo rapid technology change. sony had it at one point. I'm fine with that strategy. but it's time for apple to innovate beyond phones and tablets, where competition has caught up.

[Guest valueInv]

globally "most" don't think it's worth paying for. either that or they "can't" pay for it. regardless, aapl is giving up lots of the market in it's effort to remain the mercedes of smart devices. lots of people are just fine with Hondas and Toyotas. we will see if being the luxury alternative in smart tools is going to remain a winning strategy for shareholders. I maintain that investors are looking for innovation beyond smartphones and tablets from all these companies. the iphone may become the next ipod after all.

 

It might be their business model, don't ya think? :)

[Guest valueInv]

microsoft is a software company, ibm tech services company, etc, what is apple?

 

Apple is a devices and services (;D) company that sells a high end product experience.

 

if it's "high end" how come I can get the same "experience" with my $220 smartphone that I can with a $645 iphone? this is a faddish business. bbry can attest to that.

 

Try upgrading the OS in your "high end " Android phone and let us know how it goes  ;)

[Liberty]

this is a faddish business. bbry can attest to that.

 

BBRY failed because its products became inferior, not because some fad was over and randomly moved to some other fad (hemlines going up and down for no reason other than fashion business wants you to buy a new wardrobe).

 

That's not too surprising considering that historically RIM has been a phone/messaging company, while smartphones - despite the "phone" in their name - are now really pocket computers. So companies with lots of expertise in software and general computing came to dominate (Apple, Google). BBRY just didn't have what it take to make a competitive computer, it seems.

 

Same with Nokia. Phone maker, but not computer company.

[Guest wellmont]

microsoft is a software company, ibm tech services company, etc, what is apple?

 

Apple is a devices and services (;D) company that sells a high end product experience.

 

if it's "high end" how come I can get the same "experience" with my $220 smartphone that I can with a $645 iphone? this is a faddish business. bbry can attest to that.

 

Try upgrading the OS in your "high end " Android phone and let us know how it goes  ;)

 

I am basically on the latest version. and I didn't have to spend $700 to be on it. But the downside is I don't have any smartphone "status" when I am out it in the wild. :)

[Parsad]

I can see why some would want a larger screen, but, it also hurts portability a lot to do so, and the iPhone 5 seems to be "just right" in terms of screen size v portability, and you have to keep balancing those two. I for one, don't feel a bigger phone is a plus, I like the sleek look of this thing.

 

Developers also have problems making apps for different screen sizes.

 

I agree, but half an inch won't limit portability and will certainly make my eyes feel better after a day of reading on there!  They pretty much have the smallest screen out there.  How many people would switch over if they added even just half an inch?  I don't know, but it would certainly stop me from contemplating any other phone.  Cheers!

[Guest wellmont]

lol at $450 for a 3.5in phone. is that the BMW mini?

 

What is there to lol about, you realize they've been charging 450 for a 3.5 inch phone both last year and will continue to do it this year?

 

no. they are charging zero for it the way americans buy it. the subsidized model in USA is what allows aapl to get away with these kind of prices. but that's not working everywhere. and may even stop working here as prepaid and unsubsidized models take hold. If the American consumer actually had to pay $450 for a ip4 they wouldn't buy it.

[Viking]

Lots of people are looking at the 5C and think it is a replacement for the 5. Yes, the 5C is priced where the 5 would have been. Yes, the internals are close. But put the two phones into people hands and you will get very different emotions and reactions. The phones are totally different!

 

Watch the ad for the 5C: https://www.youtube.com/watch?v=heV0CNzC9OI

 

The tag for the 5C is "For the colorful". Could they have run this same campaign with ther old 5? No, of course not.

 

Guess what product will be at the top of the Santa list for teens this year? The iphone 5C.

I have a 13 year old daughter... she (and her friends) would kill to get their hands on one of these.

 

I think 5C will also appeal to women (look at the colors chosen).

It will also appeal to older adults who love life and don't want to grow up (again, look at the ad).

 

Now look at the 5 and compare it to the 5C... Yes, two massively different products.

 

My guess is most people posting on this board are older males... sorry, but you are not the target market and you likely don't get it.

 

A quick note on margins: the 5S is likely more profitable than the 5 (lower cost to make). With the 5S Apple will actually sell more units at a higher profit per unit. As per usual, people are misunderstanding Apple. The good news is Apple will be able to retire shares at a very reasonable cost. Over time, as Apple increases its profitability the shares will increase.

[Guest valueInv]

microsoft is a software company, ibm tech services company, etc, what is apple?

 

Apple is a devices and services (;D) company that sells a high end product experience.

 

if it's "high end" how come I can get the same "experience" with my $220 smartphone that I can with a $645 iphone? this is a faddish business. bbry can attest to that.

 

Try upgrading the OS in your "high end " Android phone and let us know how it goes  ;)

 

I am basically on the latest version. and I didn't have to spend $700 to be on it. But the downside is I don't have any smartphone "status" when I am out it in the wild. :)

Which Android phone do you have? When do you plan on upgrading to KitKat ? The day Google releases it?

[Palantir]

no. they are charging zero for it the way americans buy it. the subsidized model in USA is what allows aapl to get away with these kind of prices. but that's not working everywhere. and may even stop working here as prepaid and unsubsidized models take hold. If the American consumer actually had to pay $450 for a ip4 they wouldn't buy it.

 

That doesn't make sense, you intimated that is was ridiculous to charge 450 for a 3.5" phone, but when I point out they've been doing that for the past two years and are continuing into the next year (I guess you forgot that). People are still buying the 450 dollar 3.5" phone, especially in EMs.

[Guest wellmont]

most people don't care about upgrading on day one. besides if I want kitkat I could buy a nexus from play store, and that combined with the phone I already have would not be as expensive as a solid Gold Iphone. :)

[Guest wellmont]

no. they are charging zero for it the way americans buy it. the subsidized model in USA is what allows aapl to get away with these kind of prices. but that's not working everywhere. and may even stop working here as prepaid and unsubsidized models take hold. If the American consumer actually had to pay $450 for a ip4 they wouldn't buy it.

 

 

 

 

That doesn't make sense, you intimated that is was ridiculous to charge 450 for a 3.5" phone, but when I point out they've been doing that for the past two years and are continuing into the next year (I guess you forgot that). People are still buying the 450 dollar 3.5" phone, especially in EMs.

 

i don't think they sell lots of 3 year old $450 ip in emerging markets where they can't afford data plans. I think they sell the ip4 in USA where it's "free" on contract. Apple is getting killed in China.

 

[Guest valueInv]

most people don't care about upgrading on day one. besides if I want kitkat I could buy a nexus from play store, and that combined with the phone I already have would not be as expensive as a solid Gold Iphone. :)

 

The guys who buy high end phones do. Do you own a Nexus? I'm told that most of the high end Android market belongs to the Galaxy, which BTW got poor reviews for user experience.

[Palantir]

most people don't care about upgrading on day one. besides if I want kitkat I could buy a nexus from play store, and that combined with the phone I already have would not be as expensive as a solid Gold Iphone. :)

 

If you wanted KitKat, Nexus, and didn't want to spend more money on an iPhone, then you're not in their target market. sigh.

[Guest wellmont]

5 star phone = $99 no contract = apple headache.

 

http://www.amazon.com/Nokia-Lumia-520-GoPhone-AT/dp/B00E45043A/ref=sr_1_1?ie=UTF8&qid=1378923255&sr=8-1&keywords=lumia+520

[Guest wellmont]

most people don't care about upgrading on day one. besides if I want kitkat I could buy a nexus from play store, and that combined with the phone I already have would not be as expensive as a solid Gold Iphone. :)

 

If you wanted KitKat, Nexus, and didn't want to spend more money on an iPhone, then you're not in their target market. sigh.

 

american express gold is not target market? sigh.

 

ps: I will have kitkat on my nexus 7.  ::)

[Guest valueInv]

5 star phone = $99 no contract = apple headache.

 

http://www.amazon.com/Nokia-Lumia-520-GoPhone-AT/dp/B00E45043A/ref=sr_1_1?ie=UTF8&qid=1378923255&sr=8-1&keywords=lumia+520

 

It's funny that people can't grasp the simple concept of segmentation. Pointing to a Hyndai and saying that it offers the same experience as a Hyandai because it has 4 wheels, an engine , steering wheel and seats is plain stupid.

[Palantir]

5 star phone = $99 no contract = apple headache.

 

http://www.amazon.com/Nokia-Lumia-520-GoPhone-AT/dp/B00E45043A/ref=sr_1_1?ie=UTF8&qid=1378923255&sr=8-1&keywords=lumia+520

 

Are you seriously touting a Microsoft product now? You'd never dare do that on the MSFT thread. ;D

[rkbabang]

5 star phone = $99 no contract = apple headache.

http://www.amazon.com/Nokia-Lumia-520-GoPhone-AT/dp/B00E45043A/ref=sr_1_1?ie=UTF8&qid=1378923255&sr=8-1&keywords=lumia+520

 

Wellmont, I disagree with everything you've been saying today.  I don't have an iPhone, or any other smartphone, because I don't want to pay $80-$200/month on a data-plan.  But if I was going to pay $80-200/month (i.e. $960-$2400/year) on a phone I wouldn't be worried about paying an extra hundred or three for the device. That is only a one time expense.  I do have an iPad, and my reasoning was the same.  I'll probably use it everyday (and I have) and I'll probably have it for 3 or 4 years before upgrading so why worry about paying an extra hundred or two for it over an inferior device, which I won't be as happy with. $200 extra over 4 years is $0.13/day extra.

[Liberty]

I'll probably use it everyday (and I have) and I'll probably have it for 3 or 4 years before upgrading so why worry about paying an extra hundred or two for it over an inferior device, which I won't be as happy with. $200 extra over 4 years is $0.13/day extra.

 

Exactly. I suspect that lots of people who bought cheap smartphones because they thought it would be just like the iPhone but cheaper will switch back in the next upgrade cycle.

 

Earlier this year my sister asked me for advice on buying a tablet. Price was an issue, so I recommended the iPad Mini. She ended up going with some on-sale Android tablet and saved maybe $150 bucks. I've never seen her use it, it's in a drawer somewhere, and she's constantly on her iPhone 4S, even at home sitting on the sofa (prime tablet territory)...

[Guest wellmont]

5 star phone = $99 no contract = apple headache.

http://www.amazon.com/Nokia-Lumia-520-GoPhone-AT/dp/B00E45043A/ref=sr_1_1?ie=UTF8&qid=1378923255&sr=8-1&keywords=lumia+520

 

Wellmont, I disagree with everything you've been saying today.  I don't have an iPhone, or any other smartphone, because I don't want to pay $80-$200/month on a data-plan.  But if I was going to pay $80-200/month (i.e. $960-$2400/year) on a phone I wouldn't be worried about paying an extra hundred or three for the device. That is only a one time expense.  I do have an iPad, and my reasoning was the same.  I'll probably use it everyday (and I have) and I'll probably have it for 3 or 4 years before upgrading so why worry about paying an extra hundred or two for it over an inferior device, which I won't be as happy with. $200 extra over 4 years is $0.13/day extra.

 

you think like a value investor. so do i when it comes to stocks. but I try to think like the other guy when it comes to consumer products. and the average consumer doesn't think that way. in the USA it's not surprising apple does very well with the subsidized model. here, the ip is the same price as other good phones. but outside USA the equation is different. that's why ip doesn't do as well outside usa. cost matters to most people. wealthy people have they luxury not to care about such trivialities. this is the target market for apple.