| Saaket Unadkat – Blog

iPhone….Worth The Price???

// September 3rd, 2008 // Gadgets, My Reviews

Most iPhone aspirants must be disappointed (read: me) at the over-the-top pricing of the “gadgety” phone that we are all so in awe of. On an average, an iPhone aspirant would have settled for a 20K price tag, but paying four times the US$ price tag is something none of us none come to terms with. Is there a reason why the iPhone is so expensive? What were Apple and gang (service providers) thinking? I can certainly see some very obvious reasons why Apple thinks that they got the math absolutely right. Let me speculate – it’s better than cribbing about the pricing over and over again.

1. APPLE IS NOT NOKIA
Apple might think – Apple products are priced higher because they are meant for a different class. An Apple user is not an average daily computer user; he is in a different league. And I do think they think right….
While Apple may have finally come to terms with the reality of making numbers in a country like India, they still don’t want to be seen as a product tat is bagged by the masses and has competition from fifty other products. By pricing the iPhone at a price which can only be reached by a select few, Apple is sending a clear message on the premium positioning of the iPhone in India. While I personally wished the iPhone was priced 10K lower, subconsciously, the pricing makes sense to me. The wow factor of the iPhone has been maintained by ensuring that not every second guy in the mall is yapping on an iPhone.

2. DIFFERENT REVENUE STREAMS HERE
The reason why I think Apple can afford to sell the iPhone for US$200 price tag is because of the revenue it earns from carriers and the iTunes App store. The songs and videos n movies sold or rented out through iTunes have been making a whopping amount for Apple from day 1 of the launch. Obviously the scenario in India is a lot different. We don’t buy MP3s from online stores and we don’t spend on cell phone app too. So no immediate revenue sources for Apple here. Hence the price seems to be justified. Better to roll over the cost to the customer na???

3. OUT-OF-STOCK ALL THE TIME
The fact that the iPhone is still a sellout in the US stores clearly indicates that Apple is not able to meet the demands on home ground itself. If the iPhone was priced at 10K, given the cell-phone crazy nation that we are, Apple would have had to ramp up its production ten times or even more to meet the Indian market demand. So by pricing it high, there is enough breathing space to ensure steady supple across all markets.

4. SO WHAT NOW??
First generation iPhone users in India who paid 20K for a hacked piece will now flaunt it even more. Also, it won’t be long before the hacked versions of the iPhone 3G begin to surface. Many prospective buyers would prefer to play the wait-n-watch game, hoping that the prices drop steeply. And there are still a lucky few who could even procure a First gen iPhone for maybe 15K and still be a part of the “i” league.

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