Apple Sells 1 Million iPhones, but still loses!
It looks like those iPhone price cuts were just the thing Apple needed to drive sales, as this weekend Apple’s iPhone reached the 1 million sold mark. “One million iPhones in 74 days-it took almost two years to achieve this milestone with iPod,” said Steve Jobs, Apple’s CEO. “We can’t wait to get this revolutionary product into the hands of even more customers this holiday season.”
While reaching this milestone may seem like great news for Apple (and in most ways, it is) there is one downside to that number that is not mentioned in Apple’s press release – namely, Steve jobs promised all iPhone buyers (pre-last week’s price drop announcement) that they would receive a $100 credit to the Apple Store.
Generously assuming that the $200 price drop brought in another 150,000 iPhones customers last week, and that maybe 50,000 folks who bought iPhones in the 2 weeks leading up to the price drop may have gone ahead and gotten their $200 back from Apple during their 14-day price protection policy, that still leaves 800,000 potential iPhone owners (myself included) that will be looking for $100 back from Apple. That adds up to a potential $80,000,000 hit Apple would have to take.
Now, of course, Apple knows not everyone will take advantage of the $100 store credit, and, in order to use it, you have to be buying something at the Apple store anyway, so odds are Apple will make some money off the credits to help lessen the hit, but still, that is a staggering number when you think about it, and it makes you wonder if Apple would have done better to hold off on the price drop a month or so and wait until they had a 16GB version of the iPhone out to justify the drop in price of the 8 GB version.