Quote:
Originally Posted by Wayne at Pelican Parts
Jobs is indeed very successful. But I think you guys are missing the point. You can't compare the iPhone price drop to similar drops in plasmas, DVDs, etc, because that was a market-driven drop over years involving many companies in an entire industry.
In this case, Steve Jobs basically said, "I'm going to milk my loyal followers for as much money as I can get because I can". I don't think it's good business practice, and I don't run my company that way....
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I don't know if it's "milking". Imo, most products are designed to recoup development costs over the first generation or so, thus the initial "buy in" premium. I think Jobs saw the writing on the wall...he has a winner, but it was simply over priced for most consumers (it still might be). I remember six months ago, many (myself included), indicated we would wait for a 2nd generation (at least) before considering one. Maybe Jobs is attempting to break out of the "loyal following" (i.e. Mac users), with the iPhone, much like the iPod did. I think that these types of devices (iPhones, Blackberrys, Razrs, etc.) are absolute "cash cows", and will be for a long time for quite a few of the market leaders. Don't underestimate the power of marketing... I think it trumps technology most of the time (for better or worse).