The iPhone is not seeing any real pricing pressure. ASP has been steady and unchanging for years-- there was a slight dip to $600 in the mrq, but management attributed that to mix, not price cuts (although the 4 was discounted for sure in emerging markets). We'll see if there's a trend in Q3. The margin pressure on the iPhone has only been because the iPhone 5 appears to be fairly expensive to make, and its cost should come down over time, as Slacker predicted. You're looking back. Looking forward, there are more capable phones selling for less. As I noted earlier, the S3 keeps pace with the iPhone 5 (some consider it a little better, some a little inferior, but certainly a peer in any case) but is available for peanuts now... while the iPhone 5 still sells for around the price it was released at. Newer Android phones (not just the S4) will put even more intense pressure in a similar fashion on the next iPhone release.
I like the rumor that Apple might release a streaming music service. Not because I think they'll make substantial money from the service itself... they'd have a hard time catching up to Pandora, SXM, etc., but because they could use it as an opportunity to monetize their traffic. If they used Google's platform to monetize the traffic and keep the lion's share for themselves, they could add substantial high-margin income. |
