Summary
Apology when needed, upfront is always better than after.
Analysis
This is very unique in Apple's history - Steve Jobs apologized and offered a $100 discount for the iPhone early adopters. What would this mean exactly?
Apple has a unique ability to create iconic products like the Apple II, the Macintosh computer, the iPod and now the iPhone. This ability comes from a couple of points:
- Design to engineering process
- A real consumer understanding spirit
- A top-down and straight execution with limited compromises
The iPhone is definitely a success. However, it is the first time the company decides to cut the price of a recently introduced product so fast and introduce another model. You can call that market reaction or apologies, in any case, it is good news that Apple is listening to its customers' requests.
A price-cut may reflect a new purchase-pricing in a key component. You get a better deal and you translate it for your customers. In some other cases, it reflects a market reaction to a competitor move, or a sales drop. Finally, it can announce a new model with more features for the same old price.
It is unlikely the company is reflecting a key component price drop as the announced iPhone price in Europe is closer to the old US pricing (399 euro in Germany is approximately $550).
The other possibility would be that Apple is trying to buy market shares and is willing to suffer a loss on the iPhone in order to take the lead in the market.
In any case, Apple would not have done this price move unless forced. It will cost the company lots of money. Not only it would be compensating early iPhone buyers $100 each, it will drop the price of iPhone by $200 and it is likely the company has to compensate the current retail inventory (if any).
Lear more on Consumer and Technologies : F5 Digital Consulting blog
