Apple's £499 iPhone 4S only costs £130 to make
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Original post by gildartz
So there were absolutely no research costs when they were developing Siri?
Not a lot though. Apple bought siri.
This thread could only be thought up and supported by people with absolutely no experience of reality.
More of the ignorant cynicism disease that seems to plague most people here.
Simply saying "product cost £x to make, we are charged £x+y retail, therefore someone is evil" is a moronic misunderstanding of planet earth.
In general terms, never mind the Apple product, if you are manufacturing something for £130, selling it for £500, isn't actually particularly amazing. 20% of that £500 is VAT. The retailer is going to want their cut, as is the distributor. Things don't appear in shops by teleportation - they have to be transported there, the retail staff have to be paid, as does just about everyone else after the manufacturing costs. From your £270, you have to pay all those costs and try and make your profit.
More of the ignorant cynicism disease that seems to plague most people here.
Simply saying "product cost £x to make, we are charged £x+y retail, therefore someone is evil" is a moronic misunderstanding of planet earth.
In general terms, never mind the Apple product, if you are manufacturing something for £130, selling it for £500, isn't actually particularly amazing. 20% of that £500 is VAT. The retailer is going to want their cut, as is the distributor. Things don't appear in shops by teleportation - they have to be transported there, the retail staff have to be paid, as does just about everyone else after the manufacturing costs. From your £270, you have to pay all those costs and try and make your profit.
Original post by Besakt
Not a lot though. Apple bought siri.
Oh, they bought it? Well.... I imagine that didn't cost them anyth.... Oh wait.
Original post by Drewski
Oh, they bought it? Well.... I imagine that didn't cost them anyth.... Oh wait.
I was replying to "there was no research cost". Of course it cost them to buy it.
Original post by tehFrance
So what about the other costs unrelated to manufacturing... research and development costs for instance? does that not push up the price?
hardly, Apple spends about 13% of its revenue on R&D.
OT, whats the point about Apple having a healthy profit margin? Maybe start similar threads about other companeis, such as the pharmaceuticals ?
This is the same argument that gets applied to the pharmaceutical industry. Why do they charge huge prices for a pill that only costs £1 pound to make. The reality is the first pill cost them hundreds of millions to make and they have to recoup that cost. It is the same with the iPhone.
It is also important to note that Apple do not want to become a cheap product. The fact the phone is expensive adds value to it. If you think that's silly - just think about how many people buy Armani just because it is expensive. Price = value in the consumer mind.
On top of that Apple has done a lot to spearhead technological development in the last two decades. A lot of what we have today we might not have if it hadn't been for Steve Jobs and Apple. If they put a big margin on their products - it is our choice to buy or not to buy. If everyone stopped buying their prices would drop. The market dictates prices.
Oh and btw - if anyone will take Apple it will be Samsung. Sony and Philips? LOL
The very base of this argument though is simple - if you think it is too expensive then don't buy it. Personally I find iPhone invaluable for work and personal matters and I am more than happy to pay for it. Just because a company charges a lot for their product does not make them bad - that is naive and stupid.
It is also important to note that Apple do not want to become a cheap product. The fact the phone is expensive adds value to it. If you think that's silly - just think about how many people buy Armani just because it is expensive. Price = value in the consumer mind.
On top of that Apple has done a lot to spearhead technological development in the last two decades. A lot of what we have today we might not have if it hadn't been for Steve Jobs and Apple. If they put a big margin on their products - it is our choice to buy or not to buy. If everyone stopped buying their prices would drop. The market dictates prices.
Oh and btw - if anyone will take Apple it will be Samsung. Sony and Philips? LOL
The very base of this argument though is simple - if you think it is too expensive then don't buy it. Personally I find iPhone invaluable for work and personal matters and I am more than happy to pay for it. Just because a company charges a lot for their product does not make them bad - that is naive and stupid.
(edited 12 years ago)
Original post by Besakt
Not a lot though. Apple bought siri.
LOL. Apple don't spend a lot on R&D? Can you provide a source on this?
As someone who has a fairly in-depth knowledge of Apple's current financial standing, I can say this is probably the most nonsensical thing I have ever read on TSR. They have literally thousands of engineers working full-time on R&D. How do you think they were able to achieve the innovations they have? Magic? Or do you think they stole them from Microsoft? LOL
Original post by ChangedMyMind
This is the same argument that gets applied to the pharmaceutical industry. Why do they charge huge prices for a pill that only costs £1 pound to make. The reality is the first pill cost them hundreds of millions to make and they have to recoup that cost. It is the same with the iPhone.
It is also important to note that Apple do not want to become a cheap product. The fact the phone is expensive adds value to it. If you think that's silly - just think about how many people buy Armani just because it is expensive. Price = value in the consumer mind.
On top of that Apple has done a lot to spearhead technological development in the last two decades. A lot of what we have today we might not have if it hadn't been for Steve Jobs and Apple. If they put a big margin on their products - it is our choice to buy or not to buy. If everyone stopped buying their prices would drop. The market dictates prices.
Oh and btw - if anyone will take Apple it will be Samsung. Sony and Philips? LOL
The very base of this argument though is simple - if you think it is too expensive then don't buy it. Personally I find iPhone invaluable for work and personal matters and I am more than happy to pay for it. Just because a company charges a lot for their product does not make them bad - that is naive and stupid.
It is also important to note that Apple do not want to become a cheap product. The fact the phone is expensive adds value to it. If you think that's silly - just think about how many people buy Armani just because it is expensive. Price = value in the consumer mind.
On top of that Apple has done a lot to spearhead technological development in the last two decades. A lot of what we have today we might not have if it hadn't been for Steve Jobs and Apple. If they put a big margin on their products - it is our choice to buy or not to buy. If everyone stopped buying their prices would drop. The market dictates prices.
Oh and btw - if anyone will take Apple it will be Samsung. Sony and Philips? LOL
The very base of this argument though is simple - if you think it is too expensive then don't buy it. Personally I find iPhone invaluable for work and personal matters and I am more than happy to pay for it. Just because a company charges a lot for their product does not make them bad - that is naive and stupid.
i mean in terms of popularity. sony was big, now it isnt.
Samsung actually sold more phones than apple in the last 12 months. I'm writing this on a Samsung (lp).
Original post by ChangedMyMind
LOL. Apple don't spend a lot on R&D? Can you provide a source on this?
http://www.zdnet.com/blog/btl/apples-r-d-spending-hits-bottom-as-percentage-of-revenue/60872
Original post by ChangedMyMind
LOL. Apple don't spend a lot on R&D? Can you provide a source on this?
As someone who has a fairly in-depth knowledge of Apple's current financial standing, I can say this is probably the most nonsensical thing I have ever read on TSR. They have literally thousands of engineers working full-time on R&D. How do you think they were able to achieve the innovations they have? Magic? Or do you think they stole them from Microsoft? LOL
As someone who has a fairly in-depth knowledge of Apple's current financial standing, I can say this is probably the most nonsensical thing I have ever read on TSR. They have literally thousands of engineers working full-time on R&D. How do you think they were able to achieve the innovations they have? Magic? Or do you think they stole them from Microsoft? LOL
Apple spend less than 2.5% of their revenue on R&D. $1.78 billion.
http://www.scientificamerican.com/article.cfm?id=apples-randd-spending-hits-a-low-2011-10
Whilst frims like companies like Google and Microsoft are spending around 15%
Original post by ChangedMyMind
LOL. Apple don't spend a lot on R&D? Can you provide a source on this?
As someone who has a fairly in-depth knowledge of Apple's current financial standing, I can say this is probably the most nonsensical thing I have ever read on TSR. They have literally thousands of engineers working full-time on R&D. How do you think they were able to achieve the innovations they have? Magic? Or do you think they stole them from Microsoft? LOL
As someone who has a fairly in-depth knowledge of Apple's current financial standing, I can say this is probably the most nonsensical thing I have ever read on TSR. They have literally thousands of engineers working full-time on R&D. How do you think they were able to achieve the innovations they have? Magic? Or do you think they stole them from Microsoft? LOL
http://www.google.com/finance?q=NASDAQ%3AAAPL&fstype=ii&hl=en
This is an example of how easily statistics can be mis-used. Of course Apple's percentage of revenue spent on R&D has went down. It's revenue has increased dramatically over the last decade. Just look at the nice little table they have given you. Right now they are spending over 2.5 billion dollars on R&D just by those numbers and I know for a fact it is higher.
For comparisons sake, HTC made 9.7 billion last year compared to Apple's 65.2 billion. Using the statistics on your source that means HTC spent just under 500 million on research compared to Apple's 1.8 billion.
To everyone suddenly providing a link to Apple's stock etc - see post above.
And to the Google 15% - Google's revenue is only 30 billion less than half of Apple's. Microsoft are in panic stations because they know that they are dramatically losing market share hence the high R&D spend.
It is not about percentage of revenue people - it is about real money spent.
And to the Google 15% - Google's revenue is only 30 billion less than half of Apple's. Microsoft are in panic stations because they know that they are dramatically losing market share hence the high R&D spend.
It is not about percentage of revenue people - it is about real money spent.
Original post by tehFrance
So what about the other costs unrelated to manufacturing... research and development costs for instance? does that not push up the price?
Yes, marketing costs, and I am sure there are many other costs too. Clothing brands have a much bigger % profit margin.
Original post by justlol
i mean in terms of popularity. sony was big, now it isnt.
Samsung actually sold more phones than apple in the last 12 months. I'm writing this on a Samsung (lp).
Samsung actually sold more phones than apple in the last 12 months. I'm writing this on a Samsung (lp).
Yeah - so have quite a few other phone companies. Nokia are still (I think) the biggest manufacturer of mobile phone in the world. Samsung are the only one that (in my opinion) have any chance of beating Apple though. Some of it will depend on the on-going patent litigation between Apple and Samsung.
Original post by ChangedMyMind
To everyone suddenly providing a link to Apple's stock etc - see post above.
And to the Google 15% - Google's revenue is only 30 billion less than half of Apple's. Microsoft are in panic stations because they know that they are dramatically losing market share hence the high R&D spend.
It is not about percentage of revenue people - it is about real money spent.
And to the Google 15% - Google's revenue is only 30 billion less than half of Apple's. Microsoft are in panic stations because they know that they are dramatically losing market share hence the high R&D spend.
It is not about percentage of revenue people - it is about real money spent.
correct, because a company with an annual profit of 2 billion spending 1 billion a year on R&D is the same as a company earning 100 billion a year spending 1 billion a year on R&D
If you people want to rail on high profit margins - look at popcorn in cinema's. Costs less than a penny to make and sell for over a fiver.
Go people, go.
Go people, go.
Original post by platorepublic
Yes, marketing costs, and I am sure there are many other costs too. Clothing brands have a much bigger % profit margin.
Apple spends hardly on marketing and commercials.
Original post by T-ros
Apple spends hardly on marketing and commercials.
I somehow doubt that. I see them everywhere.
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