On Wednesday, Apple dropped the price of the iPhone from $599 to $399. Predictably, many people went wild, complaining that they got ripped off by this 33% price cut after just 10 weeks of sales, while others defended the move, comparing it to price cuts by Sony (PS3), Microsoft (XBox), and even Apple itself (Mac Mini).
For me, this brought up recent memories of TiVo’s (late) price cutting on the Series 3 high definition DVR. Introduced at $800 in September, it was available for around $650 in the Spring and dropped to $400 with a special rebate for Fathers’ Day. Then, in July, TiVo released the TiVo HD, priced at $300 and including most of the features of the Series 3. Again, recent buyers went nuts, complaining that their “investment” was wasted as prices effectively dropped by over 70% in just 9 months.
I was present for both of these storms. I bought a $600 TiVo Series 3 and my wife bought me a $600 iPhone. Of course I wish I hadn’t “had to” pay so much, but I’m not angry. That’s how things go in the fast-moving electronics space. This is doubly true of mobile phones – how many people who spent $500 or even $800 on a Motorola RAZR spite my mother in law for the one she just got for free?
Both the Series 3 and iPhone are “insanely great” products, and I am as happy with them today as when I first unboxed them. In fact, these price drops have made me seriously consider buying a TiVo HD and second TV. And I just ordered a $399 iPhone for my wife. What goes around comes around, truly!
And, by the way, if you bought a $599 iPhone on August 21 or later, Apple will give you a $200 credit, and if you bought one at any time, Apple will give you a $100 credit! Why didn’t Motorola do this for RAZR buyers!?!