Survey results released yesterday by online market researchers Compete Inc. show that consumers may not be willing to fork over $500 for an iPhone. Of nearly 400 people surveyed, 26% said they’d likely buy an iPhone—not such a bad figure for a product still in development and at least 4 months away from release. Here’s the kicker, though: of that 26% only 1% said they’d pay $500 for it. That’s one person out of all 379 surveyed. Ouch.
Although I question the validity of these results (more than just one in every 400 people has got to be willing to pay $500 for an iPod/phone/PDA device), I do think they raise a valid point: Apple’s got a major barrier in front of them. $500 is a lot to drop on a device sold by a cellular company.
What do you think? Is this survey accurate, and is $500 too much for the iPhone? Or has Compete Inc. got some reevaluating to do?
$500 is way too much to pay for a cell phone.
I wanted to get a RAZR for a while, but I didn't bite until I found I could get one from Cingular for free with a two year contract. In fact, Cingular even threw in a $50 gift card.
The iPhone will require the same two year contract AND an initial outlay of $500. To me it seems like a non starter.
I have to agree that the iPhone is juicy, but that price tag does add a bitter aftertaste to its flavor.
I want one, and I want one bad. But I keep looking at that 500 (plus tax) and I am still trying to find an excuse to justify the half grand spent. Add up the roses and dinners spent trying to soften my wife's heart to justify this purchase and we have around a 1K expense.
Come on Apple, you can do 349.99, I believe!!
umm...sorry Scott, but the iTV was introduced with a price of $299, not $399. They never changed the price, though I wish they had! [The story was in error; we've re-linked to the Macworld version of the story, because Macworld's editors saw the mistake and fixed it before they posted the item. -Ed.]
The day after the Treo 650 hit the Great White North I laid out $679.99 for one with Bell. Even then, even my geekiest friends thought I was a total nut-bar. They insisted they wouldn't invest till the 650 hit about $200. So I'd say, yeah, Mac zealots like us willing to lay out $500 for an iPhone would be lucky to make up 1% of the population. I think they survey's bang-on and most people will sit this one out till the device drops below $300.
Man, I wish I could come up with a product that 1 out of every 400 people would buy. Hell if 1 out of every 400 people. Let's see the U.S. Population is ~300,000,000 that equals out to 750,000 iPhones in the US which I believe is well with in the 100,000 number SJ said he'd like to sell.
It's too early. I didn't like the price of the iPod when it was first released. Yet I bought one within a month. No one knows what capabilities the iPhone will have yet or what the plans will cost.
Personally, my company will reimburse up to $300 for a PDA. That leaves $200 for a 4GB iPhone. Unfortunately, my company also bans cameras, so I can only hope that Apple will release a cameraless version.
smeyers, Steve wants to sell 10 million, not 100,000.
$500 is a fine price point for the early adopters. After Apple and Cingular have saturated that market, the price will come down. It's happened with every other hot phone on the market (remember the original cost of the RAZR? now they're free with contract), it will happen with the iPhone.
JOhn.
No ... one percent of ONE HUNDRED is ONE. One percent of 379 is 3.79 people (rounded, it's four.)
It's called math.
@Nyx: "of that 26% only 1% said they'd pay $500 for it. That's one person out of all 379 surveyed. Ouch."
1% of 26% of 379 = 1.
It's called reading.
$500 for a cell phone. Someone wake me up when it is available for $50.
I'm an Apple fanatic and I wouldn't spend $500 for that phone, which I saw up close at MacWorld in SF. It's incredibly beautiful, but it would also come with an expensive data plan and 2-yr contract. Plus, lack of a keyboard etc.
I just got an LG EnV - fantastic for messaging, 2 mp camera, beautiful real keyboard. Stayed with Verizon and paid $100 for it. I'm the 3rd person in the family to get that phone. We're all very happy with it.
If anything, it'll be even more expensive here in Europe, just like all the other Apple products... hopefully it'll be subsidized by the carriers...
I have to say I'm in agreement with this survey. Like many Apple fans, I'm very excited about the idea of an iPhone. But the price tag is a bit much to bear. Yes, I think the device is more than the sum of its parts. And I'd have to spend more money if I bought a decent phone, an iPod and an organizer, but the fact of the matter is that I already own such things. I've already spent that kind of money, doing it again seems illogical to me, even if it's in the name of being cool. I think that's what it comes down to. Whoever owns this phone won't do so because they just can't live without it. they'll do so because of the name brand recognition that apples hopes to create for a phone just like it did for an mp3 player that we've all come to call ipod. I'd probably be more willing to dish out the case if the ipod part of this phone at least gave me enough storage pace to download more than just a few of my songs (i have close to 4000). But $500 for a 4gb ipod? No way! I've been telling myself that as soon as it comes out I'll buy it. but the closer we get to the release date, the more I'm inclined to say maybe not. Cingular (ATT) is going to have to do a LOT to make me invest that kind of money on a device they sell. I say Cingular because Apple hasn't done enough. Just putting their name on it is not enough for me. It was enough for the ipod. But if I already own an ipod (and a motorola slvr with itunes), why exactly should I buy another one?
I'm an early adopter, consistently over the years, but the iPhone is not such a new item that I must get it. After all, I have a phone, and a PDA, so it is not something so novel that kindles my early adopter instincts. Therefore, $500 is too much.
I'm that guy that has avoided cell phones like the plague and the iPhone is the first that I've even considered or looked at...
The one thing that will hold me back is not being able to develop for it. I'm not going to spend $500+ for a Newto...er, iPhone unless I can write my own apps for it.
I'd also like to see simple games built with Unity (unity3d.com) be playable on it - I have an indie unity license but am not affiliated with them in any other way.
I think Apple hit the mark they were aiming for but, unfortunately, it's not the bullseye.
Since I'm not one of the people that has to walk around with the phone glued to their ear and I ALREADY OWN an iPod, the .mpg playback on any phone is redundant. Maybe they should offer a stripped down version, sans music playback and/or video playback, no games. THAT alone would drop the price somewhat. Heck if you already own an iPod, why buy another?
As I said earlier, you are all forming conclusions based on a 1 hour 20 minute presentation. The website has nothing but the demos Steve gave. Consider that David Pogue was told in surprisingly (for Apple) certain terms that the iPhone would include a PDF reader. Now how would that be included in the iPhone as demonstrated? Clearly this is a product in development. All I know is the iPhone is already a much better implementation than the $400 LifeDrive from Palm.
And Paul, to paraphrase your comment, $250 for an MP3 player (iPod with video). Wake me when it's $80 (iPod shuffle). $250,000 for a car (Ferrari). Wake me when it's $13,000 (Saturn ION). If all you want is a cell phone, the iPhone isn't the wrong price, it's the wrong product.