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Apple has no problem raising prices. Phones and Macs are more expensive than ever. My last Macbook cost almost 5000€. Yet they are getting more popular than eve

Apple has no problem raising prices. Phones and Macs are more expensive than ever. My last Macbook cost almost 5000€. Yet they are getting more popular than ever. They are going to continue making healthy profits with their hardware. I think their focus on services is about hedging their bets, but I think it's a distraction. Ultimately Apple is a hardware company, and that's where they will continue making all their money.

smoldesu 4y ago
You're probably right. Doing that without China will be difficult though, and finding something to replace the profitability of their services long-term may prove impossible. Their next big hardware release is a VR headset projected to cost the price of 6 PS5s - having faith in their hardware team might be wishful thinking.
techdragon 4y ago
But they do have a problem… it’s the precipitous cliff they are hesitantly approaching. The classic notion of supply and demand as a smooth continuous curve is a massive oversimplification… as Apple raises prices (in order to improve prorated margins) they impact the demand in complex ways that are hard to predict. For instance… I happily bought three sets of AirPods… until the inflation and exchange rates … literally doubled the price… it was expensive but worth it at a bit over $250 AUD… and I eagerly got some as soon as I could… but at just under $500 AUD… fuck off, I’ll keep replacing, the case and individual left/right ear pods until Apple stops letting me… because the new ones are no longer worth it as an up front cost. And it goes further… I was considering a new watch band since I was going to try and get to the gym more, having a watch band that’s better suited to this seemed logical… then while in the store I realised that these fucking assholes want to change me half the cost of a brand new charging case for my first generation AirPods Pro… for a nice strip of fabric… fuck the hell of you greedy assholes. No, sorry, I don’t have any way to reconcile this predatory pricing and instantly I got on with my day and decided to not buy anything else until I have to… Apple are worldwide facing this precipitous pricing cliff in people’s minds. They are trying to maximise profits on everything simultaneously which is exposing them to the risk customers will see this shit for what it is and consequently transform from frequent customers, to infrequent customers, (as I have) which magnifies the importance of the pricing balance for Apple and their situation is far from unique… lots of other lucrative industries are wading through this price dynamic swamp as the global financial… whatever the fuck were calling the last 12 months and onwards.
- newaccount74 4y ago
  Exchange rates suck, Apple stuff got a lot more expensive last year in Europe as well. Probably not as bad as Australia, but still bad. Regarding accessory pricing, Apple just offers premium products. They don't offer reasonably priced stuff. Whether their watch bands are worth the price is for everyone to decide for themselves. You can get third party watch bands for a fraction of the price, so I don't really think it's a big deal that Apple charges a lot for their own bands.
  - techdragon 4y ago
    The issue is that I am a premium product person… I’m one of the guys that wants a washing machine that costs three times as much but never dies, who values the fact my iPhones can last upwards of 6 years in total when I pass them on to my partner and they continue getting security updates. I am happy to pay extra for quality when it feels justified. The new watch band is a ripoff not because of its intrinsic price/quality proposition… but because I can no longer look at it think “sounds about right for a quality product”. This isn’t intrinsically Apple making a price point choice, this is the entire global economy shifting at a rate faster than my brain as a consumer can keep up. I can’t as a rational consumer be expected to do research into global fabric watch band production, long term elasticity and sweat resistance, and decide that $60 in AUD is a good price for the item in question, my brain has multiple decades of prior data built up into the kinds of simple heuristics that everyone develops, and these heuristics based on past economic data set off the “fuck off mate, that’s too much for that” thought in my brain and thus Apple loses a sale. This sort of subconscious (sometimes conscious) thought process is going to be happening thousands of times a day in Apple stores... and it’s made worse because the more clued in customers know that Apple could sacrifice some of their ludicrously juicy profit margins to try and mitigate this feeling their customers are starting to experience… but we all know they won’t do that because that’s not good business, which just sharpens that feeling of “fuck off, that’s too much” because we know not only are they making a premium product that will cost us more, we know they are deliberately choosing to exploit the trust we have in them to make quality products, to overcharge for those quality products because we aren’t necessarily sure where else we will get sufficiently good quality. When everyone in the world except the richest people and companies are making less money because of inflation related margin squeezing, the richer the company the more egregious it looks and this runs the risks of alienating customers from the brand, or more likely, driving down ancillary sales as customers can only justify the main device and buy fewer accessories, perhaps eventually even hurting Apple’s beloved “Customer SAT(isfaction)” metrics they are so proud of. I know I’ve been less satisfied with the products for years now based almost entirely on the price. Like I said, I don’t mind paying extra for quality, I resent being taken to the cleaners for it.
tpmoney 4y ago
> Phones and Macs are more expensive than ever. The phones maybe, but I don't think this is true for their computers. The Powerbook 5300 in 96 started at $2,300, which is ~$4,400 these days. The 2400c in 98 started at $3,499, almost $6,500 today. An original iMac clocked in at $1,299 in that same year, ~$2,400 today, while it's larger PowerMac cousin started at $3,700 or ~$6,800 today! An original Ti Book in 2001 would set you back $2,599 (~$4,400 today), but an iBook could be had for only $1,299 (Just ~2,200 today). It's probably worth remembering too the original Macbook Air had a sticker price of $1,799 in 2008, which is still ~$2,500 in today's dollars. All of those prices were base model prices. By comparison while the MacPro as the last Intel holdout still comes in at an eye watering $5,999 base, the most expensive base model M* computer apple sells are the 16 inch MBP and the Mac Studio, both starting at just $1999. And for fun, you can still pick up a base iMac for $1,299. Not that I disagree that Apple has any problem charging enough to make a profit, just that I don't agree that their computers are more expensive than ever.
- newaccount74 4y ago
  Macs were very expensive in the 90ies, but in the 2000s, Macs were actually getting cheaper. I remember buying a white iBook for around 2000€, and a year or two later the "unibody" plastic iBooks started at 1000€. They introduced low cost desktop macs like the eMac and the Mac Mini, making it very affordable to buy new Macs. Prices have been going up since then, and people who look for affordable Macs are buying 5 year old used machines. The upgrades also weren't as expensive as they are today; and it was common to just buy the base model and upgrade RAM and HD for cheap a year later. Today you have to spend at least 50% of the base price on upgrades if you don't want a device that's crippled with insufficient RAM/SSD.
  - tpmoney 4y ago
    I think inflation adjusted, even 00's macs are pretty much as expensive then as they are today. Apple shipped a handful of iBooks at the $999 price point, with the mid 2005 being the last for the 12 inch model. That's ~$1500 today. The cheapest eMacs started at $799, with again the last model being a 2005 model, which puts you at ~$1200 today, or $99 cheaper than the current base model iMac. And the base model iMac back then was $1299. Even the mac minis, the original came out in 2005 and base lined at $499 (~$750 today) which was for sure crazy cheap at the time. But that $499 price point didn't last more than one revision, and then one more appearance in late 2014 (~$630 today). So the latest and cheapest model mac mini is still more expensive than the base line M2 mini today in inflation adjusted dollars. As for the upgrades, having worked for a reseller in that time frame I assure you the first party RAM and storage upgrade prices were ALWAYS ridiculous and it was standard for us to recommend customers buy their own RAM and install it later if they were comfortable doing that. I will grant that isn't an option anymore in the M series, so in that respect they are more expensive, but the actual costs I suspect inflation adjusted match the same pattern here. Sadly the way back machine doesn't give us access to the pricing configs for that time, but this review (https://www.tomsguide.com/us/mac-mini-late-2014,review-2723.html https://www.tomsguide.com/us/mac-mini-late-2014,review-2723....) says going from 4GB in the base 2014 mac mini to 16GB was a $300 upgrade (and was also not user serviceable). In today's dollars that's a mere $381. The equivalent jump today from 8GB to 24GB will run you $400. So pricing it out, in 2014 a base line mac mini with a 3x RAM upgrade was ~$1,010 in today's money. A base M2 mac mini with a 3x RAM upgrade today is $999. Inflation is a killer.

smoldesu 4y ago

You're probably right. Doing that without China will be difficult though, and finding something to replace the profitability of their services long-term may prove impossible. Their next big hardware release is a VR headset projected to cost the price of 6 PS5s - having faith in their hardware team might be wishful thinking.

techdragon 4y ago

But they do have a problem… it’s the precipitous cliff they are hesitantly approaching. The classic notion of supply and demand as a smooth continuous curve is a massive oversimplification… as Apple raises prices (in order to improve prorated margins) they impact the demand in complex ways that are hard to predict. For instance… I happily bought three sets of AirPods… until the inflation and exchange rates … literally doubled the price… it was expensive but worth it at a bit over $250 AUD… and I eagerly got some as soon as I could… but at just under $500 AUD… fuck off, I’ll keep replacing, the case and individual left/right ear pods until Apple stops letting me… because the new ones are no longer worth it as an up front cost. And it goes further… I was considering a new watch band since I was going to try and get to the gym more, having a watch band that’s better suited to this seemed logical… then while in the store I realised that these fucking assholes want to change me half the cost of a brand new charging case for my first generation AirPods Pro… for a nice strip of fabric… fuck the hell of you greedy assholes. No, sorry, I don’t have any way to reconcile this predatory pricing and instantly I got on with my day and decided to not buy anything else until I have to… Apple are worldwide facing this precipitous pricing cliff in people’s minds. They are trying to maximise profits on everything simultaneously which is exposing them to the risk customers will see this shit for what it is and consequently transform from frequent customers, to infrequent customers, (as I have) which magnifies the importance of the pricing balance for Apple and their situation is far from unique… lots of other lucrative industries are wading through this price dynamic swamp as the global financial… whatever the fuck were calling the last 12 months and onwards.

newaccount74 4y ago
Exchange rates suck, Apple stuff got a lot more expensive last year in Europe as well. Probably not as bad as Australia, but still bad. Regarding accessory pricing, Apple just offers premium products. They don't offer reasonably priced stuff. Whether their watch bands are worth the price is for everyone to decide for themselves. You can get third party watch bands for a fraction of the price, so I don't really think it's a big deal that Apple charges a lot for their own bands.
- techdragon 4y ago
  The issue is that I am a premium product person… I’m one of the guys that wants a washing machine that costs three times as much but never dies, who values the fact my iPhones can last upwards of 6 years in total when I pass them on to my partner and they continue getting security updates. I am happy to pay extra for quality when it feels justified. The new watch band is a ripoff not because of its intrinsic price/quality proposition… but because I can no longer look at it think “sounds about right for a quality product”. This isn’t intrinsically Apple making a price point choice, this is the entire global economy shifting at a rate faster than my brain as a consumer can keep up. I can’t as a rational consumer be expected to do research into global fabric watch band production, long term elasticity and sweat resistance, and decide that $60 in AUD is a good price for the item in question, my brain has multiple decades of prior data built up into the kinds of simple heuristics that everyone develops, and these heuristics based on past economic data set off the “fuck off mate, that’s too much for that” thought in my brain and thus Apple loses a sale. This sort of subconscious (sometimes conscious) thought process is going to be happening thousands of times a day in Apple stores... and it’s made worse because the more clued in customers know that Apple could sacrifice some of their ludicrously juicy profit margins to try and mitigate this feeling their customers are starting to experience… but we all know they won’t do that because that’s not good business, which just sharpens that feeling of “fuck off, that’s too much” because we know not only are they making a premium product that will cost us more, we know they are deliberately choosing to exploit the trust we have in them to make quality products, to overcharge for those quality products because we aren’t necessarily sure where else we will get sufficiently good quality. When everyone in the world except the richest people and companies are making less money because of inflation related margin squeezing, the richer the company the more egregious it looks and this runs the risks of alienating customers from the brand, or more likely, driving down ancillary sales as customers can only justify the main device and buy fewer accessories, perhaps eventually even hurting Apple’s beloved “Customer SAT(isfaction)” metrics they are so proud of. I know I’ve been less satisfied with the products for years now based almost entirely on the price. Like I said, I don’t mind paying extra for quality, I resent being taken to the cleaners for it.

tpmoney 4y ago

> Phones and Macs are more expensive than ever. The phones maybe, but I don't think this is true for their computers. The Powerbook 5300 in 96 started at $2,300, which is ~$4,400 these days. The 2400c in 98 started at $3,499, almost $6,500 today. An original iMac clocked in at $1,299 in that same year, ~$2,400 today, while it's larger PowerMac cousin started at $3,700 or ~$6,800 today! An original Ti Book in 2001 would set you back $2,599 (~$4,400 today), but an iBook could be had for only $1,299 (Just ~2,200 today). It's probably worth remembering too the original Macbook Air had a sticker price of $1,799 in 2008, which is still ~$2,500 in today's dollars. All of those prices were base model prices. By comparison while the MacPro as the last Intel holdout still comes in at an eye watering $5,999 base, the most expensive base model M* computer apple sells are the 16 inch MBP and the Mac Studio, both starting at just $1999. And for fun, you can still pick up a base iMac for $1,299. Not that I disagree that Apple has any problem charging enough to make a profit, just that I don't agree that their computers are more expensive than ever.

newaccount74 4y ago
Macs were very expensive in the 90ies, but in the 2000s, Macs were actually getting cheaper. I remember buying a white iBook for around 2000€, and a year or two later the "unibody" plastic iBooks started at 1000€. They introduced low cost desktop macs like the eMac and the Mac Mini, making it very affordable to buy new Macs. Prices have been going up since then, and people who look for affordable Macs are buying 5 year old used machines. The upgrades also weren't as expensive as they are today; and it was common to just buy the base model and upgrade RAM and HD for cheap a year later. Today you have to spend at least 50% of the base price on upgrades if you don't want a device that's crippled with insufficient RAM/SSD.
- tpmoney 4y ago
  I think inflation adjusted, even 00's macs are pretty much as expensive then as they are today. Apple shipped a handful of iBooks at the $999 price point, with the mid 2005 being the last for the 12 inch model. That's ~$1500 today. The cheapest eMacs started at $799, with again the last model being a 2005 model, which puts you at ~$1200 today, or $99 cheaper than the current base model iMac. And the base model iMac back then was $1299. Even the mac minis, the original came out in 2005 and base lined at $499 (~$750 today) which was for sure crazy cheap at the time. But that $499 price point didn't last more than one revision, and then one more appearance in late 2014 (~$630 today). So the latest and cheapest model mac mini is still more expensive than the base line M2 mini today in inflation adjusted dollars. As for the upgrades, having worked for a reseller in that time frame I assure you the first party RAM and storage upgrade prices were ALWAYS ridiculous and it was standard for us to recommend customers buy their own RAM and install it later if they were comfortable doing that. I will grant that isn't an option anymore in the M series, so in that respect they are more expensive, but the actual costs I suspect inflation adjusted match the same pattern here. Sadly the way back machine doesn't give us access to the pricing configs for that time, but this review (https://www.tomsguide.com/us/mac-mini-late-2014,review-2723.html https://www.tomsguide.com/us/mac-mini-late-2014,review-2723....) says going from 4GB in the base 2014 mac mini to 16GB was a $300 upgrade (and was also not user serviceable). In today's dollars that's a mere $381. The equivalent jump today from 8GB to 24GB will run you $400. So pricing it out, in 2014 a base line mac mini with a 3x RAM upgrade was ~$1,010 in today's money. A base M2 mac mini with a 3x RAM upgrade today is $999. Inflation is a killer.