Apple iPhone `Subsidized' by Cingular, Says Who?

[Matt Johnston]

On 15 Jan 2007, at 11:48, Max Song wrote:
>  propagate the notion that the list prices of
> Apple, Inc.'s iPhone are somehow tempered by monies from Cingular and
> would otherwise be substantially higher.
>
> Unless this is something Apple, Inc. has specifically articulated, I
> would say that this is a grossly mistaken assumption being made.

The fact that the unit is $499 for the 4 GB model and other models of  
"smartphone' are heavily subsidised by the carriers in order to make  
them affordable.


> I have looked, admittedly perhaps not as extensively as others, but
> have not read or seen any evidence of such a claim being made by
> Apple, Inc. or Cingular.

But it is normal, common and accepted in the phone market.

> Who subsidized the original iPod's?

iPods are not phones.

iPods were not depending on someone else for a major part of their  
function.

There was no precedent for subsidising MP3 players.

However.

iPhone is a phone (geddit?)
IPhone depends on someone elses network fro a major function
There is a precedent.

>   What were their price points again?  Didn't the original iPod offer
> breakthroughs in the MP3 landscape?  `Partnering' and `Subsidizing',
> as articulated and implied in this context, are not automatic.

The original 5 GB iPod was $399.

The 5 MB Newton MessagePad 2000 sold for $950.


> I am sorry but the "Doh, everybody knows this is just how these
> things work" argument and logic does not fly.  It is precisely this
> kind of thinking that allows Apple to deliver revolutionary products,
> the assumptions others continued to make about how a cell phone must
> work, what can and can't be done, and what the public will and will
> not pay for.

Would the public pay for a $950 phone?

Who here would?