Stop Complaining About the iPhone's Price

I'm a big Mac fan, so this post may seem biased, but I think I have some valid points on why everyone should stop complaining about the iPhone and it's price and how it's going to fail and just listen carefully :).

What Apple is doing now with the iPhone, it did with the iPod 5 years ago. Remember when Steve announced the 5GB iPod?

If you forgot, here it is.




Watch it before you read the rest of this. Keep in mind that Apple was nearly dead just a few years before this and the iPod could have sent the company in either direction. But Apple took a risk. They released a music player that was ONLY available on the Mac and boy was it expensive. I mean who was going to pay $400 US when a disc-man was much cheaper.

Over the next few years we got larger capacity models and the price began to come down. Then finally, Apple took it mainstream by releasing a USB version for Windows. Along with its iTunes store, the rest was history. We now have iPods that sell for less than $100 and everyone can afford it. The iPod was years ahead of everything else out there.

Fast forward to Macworld SF, where Apple introduces its next consumer product, the iPhone. Again, Apple is following the same strategy. Instead of making this a Mac only phone, it's sold only through Cingular. In order for Apple to keep the product within a certain niche until it can refine the product and keep up with demand, they priced it at $499+.

It's identical to their iPod strategy. But what's different this time? Apple's brand is much stronger today. People love the iPod. People trust Apple. People love Apple's design and ease of use. And because of all of this, even at $499, people are going to buy buying up iPhones at a much faster rate than Apple can produce them at and over time, we'll see cheaper models with more capacity and features, just like we did with the iPod. It's a 3-5 year strategy that's just much more difficult to realize now, because of all the success Apple has had with its iPod.

So yes, as soon as this thing is available in Canada (maybe even before), I'm going to try and get my hands on one :)

Note: For those of you who can't wait to get one, why not make your own here.