Evidently the backlash on the iPhone price drop was felt in Cupertino and beyond. Apple has announced a rebate for those early adopters.

Interesting that what sparked the outrage was, essentially, good news: the price drop. Clearly, it wasn’t good news to those who had paid full truck.

When I was a kid there was an assumption that all prices would always rise. This was the era of the Nixon/Ford/Carter economy, and the Arab oil embargo (which put my father out of business), so I understand the logic. But now we live in an era when many many prices fall — food prices (adjusted for inflation), gasoline prices the past month or two, and certainly, and ongoingly, technology prices. The laptop I’m writing this on — a MacBook pro — was state of the art in June of 2006 when  I bought it. It was $2500 and came with 512 mb of RAM, 80 gigs of storage capacity, and a 1.83 ghz processor. Now, just over one year later, a similar model would have four times as much RAM (2 mb), 50% more storage, and 20% more speed (2.2 ghz). And it would cost $500 less. The lesson is that you can’t chase technology (as Steve Jobs says, in the link above):  computing power will increase, and prices will decrease — as they have done consistently for 25 years.

So why are the early adopter iPhone buyers who are angry about this price drop so miffed?

Because it makes them look foolish. They bought early, and Apple discounted the price too quickly, so they were punished for buying early.

Early adopters want to look cool, not foolish. They want to feel ahead of the curve, not caught in the blowback of a tailspin.

An important lesson for Apple.

This entry was posted on Thursday, September 6th, 2007 at 7:40 pm and is filed under Thoughts. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.