Apple’s price cut for iphone is still not a good reason to get an iphone.

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So if you haven’t kept up with business news or news in general, you may not have known that apple decided to get rid of their 4GB iphone and slash 200 dollars off their 8GB iphone. This was Jobs states is to stimulate sales as the high price tag may have deterred some people from getting this gadget. I think the issue is not with the intial price tag but the fact that Apple has an exclusive relationship with AT&T that may deter many people from taking the plunge. If you were the few that did buy it at the more expensive price, you can get a 100 dollar credit from apple because there was so much hooplah about the price cut that Steve Jobs did not want to alienate the people who bought the technology early on.

Lets face it though, I think that people who bought it early on should not complain because they agreed to buy something at the set price. They also had the privilege to show off to everyone that they have the newest things. (this is a bad way to live if you want to live frugally).

The price doesn’t address the fact that in general, cellular plans have gotten much more expensive or that people have gotten use to paying a lot of money on a monthly basis for their cell phone usage. Per minute basis however, I understand that usage is a whole lot cheaper now but a monthly recurring fee really adds up. At 60 dollars per month, its still going to cost you 720 dollars a year before taxes and all the extra bells and whistles you would want to get for the iphone such as music from itunes and tv shows and movies for download. Yes you can pirate a lot of this for free but if you were honest, then it can add up. People who design video game systems initially price their machines at below profit levels in order to make that money back by selling video games. This is a similar theory behind apple’s marketing strategy except they actually still make a profit from selling the iphones also as well as a cut from AT&T.

You still have a lot of selections from apple, now with the ipod touch, you get everything the iphone offers except the phone part. It costs 299 for the 8 gig model and 399 for the 16 gig model. With the iphone selling at 399, it may be a toss up if you are planning on getting a mobile music player.  However, i find that I enjoy the free music that I get from pandora.com.  It may make a lot of sense to go ahead an buy an apple ipod for movies if we didn’t have to buy the movies as most people tend not to watch a movie more than once.  Having a few discussions with friends, it would make a lot of sense for apple to have a partnership with netflix to allow movie downloads onto iphones and ipods on top of the download movie service from itunes.

In any case, sales have been brisk with apples new line up of handhelds. And there are a lot of people out there who are going to be buying these machines. If this new piece of technology is really something that will make you happy then there is nothing wrong with buying it.  The economical sense, however, is to ride the wave with apple, buy a few shares of the company instead of buying a depreciating asset and let other people’s monetary indiscretions work for you.

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