Apple's Secret Weapon To Influence Industry Pricing

Hugh Pickens writes "Nick Wingfield writes in the NY Times that Apple's present pricing strategy is a big change from the 1990s, when consumers regarded Apple as a producer of overpriced tech baubles, unable to compete effectively with its Macintosh family of computers against the far cheaper Windows PCs. Now within the premium product categories where Apple is most at home, comparable devices often do no better than match or slightly undercut Apple's prices. 'They're not cheap, but I don't think they're viewed as high-priced anymore,' says Stewart Alsop. Winfield writes that Apple uses its growing manufacturing scale and logistics prowess to deliver Apple products at far more aggressive prices, which in turn gives it more power to influence pricing industrywide, and one of Apple's pricing secrets has been it's willingness to tap into its huge war chest — $82 billion in cash and marketable securities last quarter — to take big gambles by locking up supplies of parts for years."

Re:True for tablets, not computers

[alen]

There is more to a computer than CPU and ram. iMacs have very expensive monitors.

Re:So they have a reasonably priced product...

[curmi]

Not sure that is a fair comparison given that Dell laptop is reported to have poor build quality, poor battery life (some people report 2 hours), a poor quality screen, and I'm not even sure Dell sell it anymore. Also, the Apple laptop in question has Thunderbolt, backlit keyboard, firewire 800, 7 hour battery, solid aluminium (not plastic) and magsafe power connector. Not to mention a better operating system. It is clearly a better designed and engineered machine than the Dell.

You'll always find laptops that are cheaper than Apple. But you get what you pay for.

Re:True for tablets, not computers

[beelsebob]

Really? The iMac is reaching end of release cycle, so isn't at its peak of value, but...

27" iMac built from scratch (prices from newegg):
27" 2560x1440 S-IPS monitor including camera: $999 (from apple, 1099 if you buy it from dell)
i5 2300: $179.99
DH67GD: $102.99
2x2GB DDR3 1333: $22.99
1TB 7200rpm HDD: $139.99
Radeon 6670 (aproximating the speed of the 6770m here): $79.99
Corsair CX430 PSU: $44.99
Antec 300: $69.99
Total: $1639.93
Apple's price: $1699

That really doesn't look like too bad to me. Were you by any chance ignoring the price of a 2560x1440 S-IPS monitor when you were finding they cost twice the price?

Aside –the system built here will be significantly louder than an iMac too, and significantly bulkier. Factoring that in, I'm sure we can forgive apple $60 at the end of their release cycle ;)

Re:No, they couldn't build it in the US

[znerk]

Look at the report to the President on Ensuring American Leadership in Advanced Manufacturing. (http://www.whitehouse.gov/sites/default/files/microsites/ostp/pcast-advanced-manufacturing-june2011.pdf [whitehouse.gov])
Laptops, semiconductor memory device, flat panel displays, and lithium-ion batteries are all technologies that America has lost the capability to manufacture. Apple could not manufacture their products in the US anymore.

Reposted to help get this AC's point out where people who ignore ACs will see it, and also to add an anchor tag to the "linked" document, so those of us who hate seeing URLs without links can just click the darn thing.

Re:True for tablets, not computers

[catmistake]

You're comparing apples and oranges. But, sure, I believe with Thunderbolt you can run 3 extra monitors for awesome gaming. But Mac isn't really used much for a gaming platform. And fancy tvtuners work fine on USB now, even if the actual tuners are completely worthless in the US, because cable providers no longer just use a simple descrambler... that settop tuner box you are forced to use is actually a linux machine, and you are required to use that tuner (unless you're receiving signal over the air instead of cable). Whatever expansion the lack of PCI slots removes is easily mitigated by USB/fw800/Thunderbolt. Also, the box you describe sounds like an ugly, unweildy, dust collector, and not the first thing someone sees and immediately envies when they walk in the room... unlike the iMac... which sort of is an attention whore, comparitively.

Re:True for tablets, not computers

[bonch]

This isn't exactly true for computers, but it sure is true for tablets. I can easily find better and more capable computers for lesser price than Macs

This is difficult to gauge, because Macs also ship with a lot of free software that would add to the price of a comparable PC.