Apple iPhone Price Drop: A Sign Of Weakness

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By Douglas A. McIntyre Published
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Apple (AAPL) bulls like the folks at Piper Jaffray can say whatever they want. The AAPL plan to drop the price on the iPhone by $200 to $399 is a stunning sign of weakness. The old plan of losing money on every unit and making it up on volume has never worked.

AAPL CEO Steve Jobs said that "We’ve clearly got a breakthrough product, and we want to make it affordable for even more customers as we enter this holiday season."  It is better than a lump of coal in the stocking. But, Apple is talking about selling 10 million iPhones by the end of 2008. Giving up $200 on each one when the company should not have to looks like a mighty big haircut.

Cutting prices. A sign of weakness. Almost no one on Wall St. thinks otherwise.

Douglas A. McIntyre

Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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