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Post by Deleted on Sept 10, 2013 18:13:57 GMT -8
Well Apples pricing scheme has already boosted ASP from at least one purchase decision. I was going to consider getting a 5C if it was the new entry level phone, but since it isn't and the iPhone 5S is so much better for only a little extra, I am going to be spending upwards of $700 instead of $450. Ah burgess...maybe the last laugh is really on us...this may have ultimately been AAPL's strategy all along Its kind of true - perhaps the 5C is simply too good a phone - to sell it any cheaper would mean few would choose the higher priced models.
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Post by Nevyn on Sept 10, 2013 18:14:33 GMT -8
I bought some Jan 14 450 C. Then you paid about $6500 a contract. I'll wager that the day after October earnings you could sell the Jan 14 $500 C for the same price, giving you an easily achievable $50 Spread that cost you nothing (you get your investment back when you sell the $500s). I paid about $5800 per contract. These are in an RRSP ( Canadian IRA). No tax, but I can't be short anything.
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Post by Deleted on Sept 10, 2013 18:15:13 GMT -8
Its just sad that Tuffett or I can't say we disagree with Apple's pricing on the iPhone 5C without being called out as idiots...the kind of thinking that Apple does everything right and blindly following along is what got everyone in trouble last year.
Apple had large declines in China and is getting killed by Android in the emerging markets right now.
Nowhere did I or Tuffett say Apple should race to the bottom, but I don't see the issue with having an iPhone 5C at 35% margins instead of the 50-60% that it most likely has now. It would help gain market share and keep Apple as a luxury brand. If Apple prices their new phones so only 5% of the population can afford them, that's a terrible business move in my mind. Tim Cook even mentioned that they were surprised at the poor performance in China over the last year, and what does he do to help it?? Release an iPhone with some gimmicky colors that is still priced out of most of their range.
Like it or not, but Android is pulling away from Apple in almost every market of the non subsidized world. When price is comparable like in the US or Canada, Apple is dominating, but everywhere else it's losing. I don't have a problem with only making 30 - 40% margins on an iPhone...it's very similar to what the iPad makes, and probably more than the iPad Mini which no one complains about here.
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Post by Deleted on Sept 10, 2013 18:16:27 GMT -8
I looked at the China prices posted above and like most of you am scratching my head on the price...finding it seemingly too high. I refuse to believe that AAPL priced the 5C based on a random game of throwing spaghetti against the wall. They MUST have researched this and we are possibly missing something here, no? Nope, Apple has no pricing strategy in China. It's all ad hoc. If only Tim Cook read this board. ROTFLMAO Phoebear I am NOT laughing at your post, JD's response was just too funny to not respond.
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Post by tuffett on Sept 10, 2013 18:16:29 GMT -8
Ah burgess...maybe the last laugh is really on us...this may have ultimately been AAPL's strategy all along Its kind of true - perhaps the 5C is simply too good a phone - to sell it any cheaper would mean few would choose the higher priced models. This article makes the same kind of point: techland.time.com/2013/09/10/iphone-5c-c-stands-for-cake/I do see the potential of this pricing strategy for the domestic market. It's international non-subsidy market that worries me.
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Post by Deleted on Sept 10, 2013 18:16:51 GMT -8
It's 10am in China right now. Isn't that when the event is supposed to start? Is just a replay of the event.
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Post by prazan on Sept 10, 2013 18:18:49 GMT -8
Thanks to Tuffett for bearing groundless abuse with gentlemanly aplomb. I also very much appreciate hearing his ideas, because they often mirror the dark side of my own fears.
The 5s looks like a stupendously great phone. I'm awestruck. Like my favorite women, it's fast, beautiful, and secure. Also expensive, but worth every dime.
The cases, well, who cares? Lots of alternatives on the market.
The 5c is the 5 with a colorful plastic case and a small spec bump here and there, mostly in battery life. I'm guessing it's easier to manufacture and margins will be higher. It should prove more popular, incrementally, than the 5 would have been as the number 2 model.
I'd be jumping with applause if not for the price of the 5c, in particular the narrow difference between it and the 5s, which is clearly the superior work. Who wouldn't pay an extra $100 for the better phone? The camera alone is worth the money. And fingerprint identification is a huge product differentiator. With such a huge differentiation in technology between the 5c and 5s, I'd expect more differentiation in price.
I'd been hoping for a disruptive change in Apple's approach to the smart phone market; Apple instead opted for what I believe to be an incremental approach. It may turn out to be the smartest approach, but I'm not convinced the market will see it that way. And given the lack of preorders on the 5s, I'm not confident we'll smash weekend/weekly sales records on the release date. Given the addition of China, perhaps we'll show an incremental beat.
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Post by tuffett on Sept 10, 2013 18:20:55 GMT -8
Its just sad that Tuffett or I can't say we disagree with Apple's pricing on the iPhone 5C without being called out as idiots...the kind of thinking that Apple does everything right and blindly following along is what got everyone in trouble last year. Apple had large declines in China and is getting killed by Android in the emerging markets right now. Nowhere did I or Tuffett say Apple should race to the bottom, but I don't see the issue with having an iPhone 5C at 35% margins instead of the 50-60% that it most likely has now. It would help gain market share and keep Apple as a luxury brand. If Apple prices their new phones so only 5% of the population can afford them, that's a terrible business move in my mind. Tim Cook even mentioned that they were surprised at the poor performance in China over the last year, and what does he do to help it?? Release an iPhone with some gimmicky colors that is still priced out of most of their range. Like it or not, but Android is pulling away from Apple in almost every market of the non subsidized world. When price is comparable like in the US or Canada, Apple is dominating, but everywhere else it's losing. I don't have a problem with only making 30 - 40% margins on an iPhone...it's very similar to what the iPad makes, and probably more than the iPad Mini which no one complains about here. Pretty much my thoughts except I think 5C looks quite nice in concert with iOS7. Hardware revenue is one factor, but getting more devices into the hands of people creates a better ecosystem, better retention rates and healthier software revenue growth. Not to mention the ever increasing number of credit cards. I do see the case where the 5C may initially sell out due to launch demand, so maybe the pricing is appropriate at this point in time. Come Q2 and Q3 though, I'm skeptical.
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Post by tuffett on Sept 10, 2013 18:22:00 GMT -8
Thanks to Tuffett for bearing groundless abuse with gentlemanly aplomb. I also very much appreciate hearing his ideas, because they often mirror the dark side of my own fears. The 5s looks like a stupendously great phone. I'm awestruck. Like my favorite women, it's fast, beautiful, and secure. Also expensive, but worth every dime. The cases, well, who cares? Lots of alternatives on the market. The 5c is the 5 with a colorful plastic case and a small spec bump here and there, mostly in battery life. I'm guessing it's easier to manufacture and margins will be higher. It should prove more popular, incrementally, than the 5 would have been as the number 2 model. I'd be jumping with applause if not for the price of the 5c, in particular the narrow difference between it and the 5s, which is clearly the superior work. Who wouldn't pay an extra $100 for the better phone? The camera alone is worth the money. And fingerprint identification is a huge product differentiator. With such a huge differentiation in technology between the 5c and 5s, I'd expect more differentiation in price. I'd been hoping for a disruptive change in Apple's approach to the smart phone market; Apple instead opted for what I believe to be an incremental approach. It may turn out to be the smartest approach, but I'm not convinced the market will see it that way. And given the lack of preorders on the 5s, I'm not confident we'll smash weekend/weekly sales records on the release date. Given the addition of China, perhaps we'll show an incremental beat. Thanks Prazan. I've tried my best but Gregg's last unwarranted hypocrisy-laden attack on my education, knowledge and profession put me over the edge. I'm back in line now. I agree with your entire post. I feel that now was the time to make a move, and only a half-move was made. But the show may not be over...
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Post by phoebear611 on Sept 10, 2013 18:23:31 GMT -8
It's 10am in China right now. Isn't that when the event is supposed to start? Is just a replay of the event. So when do we expect the ChinaMob deal to be announced? Wouldn't it be at this presentation if it will happen at all?
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Post by leonb on Sept 10, 2013 18:23:46 GMT -8
It's 10am in China right now. Isn't that when the event is supposed to start? Is just a replay of the event. Do we know this for sure? If so, should we worry (those of us not afraid to worry) that the CM deal has not in fact been struck, despite the confident rumours?
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Post by prazan on Sept 10, 2013 18:26:24 GMT -8
From a Seeking Alpha abstract, not confirmed by other sources:
"Also: though the 5S/5C are said to support more LTE bands than rival devices, the 2.5 GHz. band used by China Mobile (CHL) for its TD-LTE 4G network isn't among them. It's possible future 5S/5C models will feature the band, particularly in light of the WSJ's Friday report."
If anyone can confirm or rebut this, please do so.
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Post by macwire on Sept 10, 2013 18:29:13 GMT -8
What was the point of this useless event...
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Post by leonb on Sept 10, 2013 18:34:02 GMT -8
I just don't get this. The event is a screening of something that has been up on the website for hours? Is it possible that the event was scheduled to announce a CM deal, but something has meanwhile gone wrong?
I thought the new phones and the 5S fingerprint feature in particular looked great, but with no CM (after Fri) and the 5C price tomorrow could be ugly, which is a shame as I just added to my position.
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Post by prazan on Sept 10, 2013 18:35:48 GMT -8
Is just a replay of the event. So when do we expect the ChinaMob deal to be announced? Wouldn't it be at this presentation if it will happen at all? If it won't be available at CHL on launch, then why announce a deal? From what I've read (which isn't exhaustive) the new TD-LTE 4G network at CHL won't be ready until later this year, and some regulatory approval will be necessary, though that approval may already be done and not yet announced: www.unwiredview.com/2013/09/10/china-mobiles-iphone-5s-with-td-lte-support-may-already-passed-through-miit-certification/If it's not announced, it doesn't mean the deal hasn't been made.
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Post by terps530 on Sept 10, 2013 18:37:06 GMT -8
If they don't announce CM, then I've had it with gene Munster. How does a guy not only keep his job, but get so much cred. He has predicted Apple TV every 3 months for the past two years and it never has happened. He goes on cnbc and says 99% china mobile is happening in china now.
So if it doesn't I will attempt to call him out. And be pissed about my buy in the low 490s today.
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Post by leonb on Sept 10, 2013 18:38:39 GMT -8
If a deal had been done it would still make sense to announce ahead of availability, in order to prevent customers picking up second choice phones, who might otherwise be more inclined to wait.
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Post by tuffett on Sept 10, 2013 18:40:39 GMT -8
If a deal had been done it would still make sense to announce ahead of availability, in order to prevent customers picking up second choice phones, who might otherwise be more inclined to wait. Yes. And from China Mobile's perspective, it would help prevent people from switching to the other carriers to get the iPhone.
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Post by terps530 on Sept 10, 2013 18:43:31 GMT -8
If a deal had been done it would still make sense to announce ahead of availability, in order to prevent customers picking up second choice phones, who might otherwise be more inclined to wait. Yes. And from China Mobile's perspective, it would help prevent people from switching to the other carriers to get the iPhone. Two very good points
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Mav
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Post by Mav on Sept 10, 2013 18:46:14 GMT -8
OTOH, if the network simply isn't ready?
Sigh. Some clues in about an hour, more as we figure out whether LTE band support somehow doesn't mean compatibility with CM LTE operating on the exact same bands. Frustrating trying to filter the fact from FUD.
Meanwhile, CM is the only carrier worth having that TD-LTE support for (or is it? Bah)
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Mav
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Post by Mav on Sept 10, 2013 18:56:37 GMT -8
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Post by macwire on Sept 10, 2013 19:00:12 GMT -8
I'm utterly confused by this event. Why not just say that we are replaying this for Chinese audiences...lol.
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Post by prazan on Sept 10, 2013 19:06:49 GMT -8
I think the event was also replayed in/for Japan, and for Europe. Everyone just jumped to the conclusion that it would be a venue for additional information.
Mav, thanks for the follow up. Technical specs are not my strong suit.
I think the decision to announce or not announce is CHL's. Yes, to announce would prevent additional user defections, but also might crush sales of other phones at a time when they can't sell the new iPhones.
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Post by gtrplyr on Sept 10, 2013 19:11:06 GMT -8
Ok so the event started in China 1hr and 9 minutes ago ..... I would think we should hear something in the next 15-20 minutes if the China Mobile deal is in place . Fingers crossed as we could use some positive news at this point.
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Post by Deleted on Sept 10, 2013 19:13:09 GMT -8
the delayed event in China is likely just so local journalists can get hands on time with demo devices
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Post by macwire on Sept 10, 2013 19:13:15 GMT -8
There's no news I'm fairly certain. Wouldn't cook himself want to announce this?
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Post by Deleted on Sept 10, 2013 19:14:38 GMT -8
its funny, on any other day if Apple announced the NTT Docomo addition, the news would be greatly received.
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Post by gtrplyr on Sept 10, 2013 19:15:03 GMT -8
There's no news I'm fairly certain. Wouldn't cook himself want to announce this? He still could via satellite ... but it would have to happen VERY soon. I can see them playing the entire event and then having Tim live at the end. Wishful thinking I'm afraid If nothing happens tomorrow will be ugly.
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Post by macwire on Sept 10, 2013 19:16:54 GMT -8
It's very bearish out there. Which is ultimately a contrarian indicator.
Good luck all.
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Post by Deleted on Sept 10, 2013 19:17:52 GMT -8
follow @eyooncnbc on twitter, she is tweeting live from event. CNBC asia anchors are waiting for it as well.
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