‘Focusing on Certain Segments’

This “Apple should make a cheap iPhone” thing reminds me of the “Apple should make a cheap netbook” argument from four or five years ago. Remember this quote from Steve Jobs in 2008?

There are some customers which we chose not to serve. We don’t know how to make a $500 computer that’s not a piece of junk, and our DNA will not let us ship that. But we can continue to deliver greater and greater value to those customers that we choose to serve. And there’s a lot of them. We’ve seen great success by focusing on certain segments of the market and not trying to be everything to everybody. So I think you can expect us to stick with that winning strategy and continue to try to add more and more value to those products in those customer bases we choose to serve.

That clearly didn’t mean Apple was never going to ship a $500 computer — in April 2010 they shipped the iPad. Hell, as of two months ago, Apple now sells computers starting at just $329. It just means they weren’t going to ship a $500 computer until they could make one that was both a good product and profitable for the company.

Their approach to lower price points for the iPhone will be the same.

Thursday, 10 January 2013

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