True there are costs associated with R&D and Marketing for the device but prior to launching the product those were just overhead and fixed costs. Continuous improvements and all that aside there should still be a hefty profit margin per unit sold for Apple.
Once the advertisements are out the bag and on tv, it should technically cost them nothing extra to get the next customer into the store if that consumer was interested.
Fixed cost or not they still have to pay it. The cost of devices generally drops as time goes on, once those fixed costs are paid off.
The 1g 5gb iPod was $499 when it came out. Now you can get an 30gb iPod with a color screen, video playback, and half the thickness for half that price.
Fixed costs can be spread out through their production, Apple plans on getting their units into like 1% of the World's cell phone market, or 10 Million, by the end of 2008 they're easily able to recover those fixed costs quickly if they succeed in their goals.
Fixed costs can be spread out through their production, Apple plans on getting their units into like 1% of the World's cell phone market, or 10 Million, by the end of 2008 they're easily able to recover those fixed costs quickly if they succeed in their goals.
“At a glance -- particularly as a non-Storm user -- you might say "wait a second, that's just a Storm." And in reality, you wouldn't be far off with that assessment.”
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Yes hundreds of dollars of pure profit because it cost nothing to design or market the device.
First, product design is a fixed cost.
Second, if Apple is spending hundreds of dollars *per phone* on marketing, something is horribly wrong with them.
True there are costs associated with R&D and Marketing for the device but prior to launching the product those were just overhead and fixed costs. Continuous improvements and all that aside there should still be a hefty profit margin per unit sold for Apple.
Once the advertisements are out the bag and on tv, it should technically cost them nothing extra to get the next customer into the store if that consumer was interested.
Fixed cost or not they still have to pay it. The cost of devices generally drops as time goes on, once those fixed costs are paid off.
The 1g 5gb iPod was $499 when it came out. Now you can get an 30gb iPod with a color screen, video playback, and half the thickness for half that price.
Fixed costs can be spread out through their production, Apple plans on getting their units into like 1% of the World's cell phone market, or 10 Million, by the end of 2008 they're easily able to recover those fixed costs quickly if they succeed in their goals.
Fixed costs can be spread out through their production, Apple plans on getting their units into like 1% of the World's cell phone market, or 10 Million, by the end of 2008 they're easily able to recover those fixed costs quickly if they succeed in their goals.