updated 02:20 pm EDT, Thu September 6, 2007
Jobs: no iPhone refunds
Apple's Steve Jobs says Apple won't give users refunds for purchasing one of the early iPhones at $599 and that the price drop won't really hurt Apple's bottom line. Less than 10 weeks after the iPhone launch, the 33 percent price cut is one of the most dramatic seen by Apple fans, but is common in the world of technology, according to the CEO. Jobs quickly stepped past offering any apology in an interview with USA Today and didn't touch upon the apparent lack of consistency in stories that both Apple and AT&T are offering different customers: some customers are having luck getting refunds, credits, or other compensation, while others are even being treated rudely. "That's technology," Jobs said when asked what he would tell his early adopter customers -- many of whom are irate. "If they bought it this morning, they should go back to where they bought it and talk to them. If they bought it a month ago, well, that's what happens in technology."
Jobs went on to say that the upcoming holiday season was a large reason for the price drop and that its ramped manufacturing processes will help it sustain its margins.
"We're in high-volume manufacturing, and we're pretty good on the costs side," he continued. "We're also willing to be more aggressive. We think we have a real winner, and customers love the iPhone. The product's been extremely well accepted; we want to put the pedal to the metal. A holiday season is approaching; we'd have to wait another year for another one."
While price drops are generally good for consumers, Apple may have made a few mistakes in its price drop, according to Wired News. The company says that Apple's early adopters were "forecasted, quantified, and exploited for maximum profit" -- a very normal part of the technology world, but the lack of tact in the announcement may cost the company some customers.
"It's not unfair that Apple views its most loyal customers in the same fashion, but it's incredibly tacky that the company made that fact so palpable with its price drop," Terrence Russell wrote. "Seeing the evolution of the iPod is great, but it's not going to cause us to forget the $200 price difference."
Russell also noted that the price drop may be premature for the holiday season, and that Apple may have over-estimated the effect of its "stupid" tax with the price drop.
"It's no secret that electronics drop in price over time, but such a deep and hasty discount makes trying to quantify the realistic retail value of the hardware confusing," Russell wrote. "A mistake of this nature just encourages pricing paranoia."
In his USA Today interview, Jobs said that Apple was ready and waiting for the Beatles to deliver their music via iTunes.
"We'd love to have the Beatles. It will happen -- I hope by the first half of next year. As soon as they're ready, we're ready," Jobs said.
Following agreements with several Beatles members to bring their music to iTunes, many hoped that Apple would use Wednesday's iPod/iTunes event to announce a full distribution deal for all of the Beatles' music on iTunes.