Is the Stairway to Heaven still working?

Time to re-frame pricing on a daily basis

The launch of the iPhone Duo and the surge in memory pricing has caused a disturbance in the force. The new Stairway graph is shown below (click on graph to see higher resolution.)

A few notes:

• The process of lowering prices for n-1 devices has reversed. Previous generation iPhone prices have gone up for the first time ever. This is mitigated by the fact that “n-1” is not quite apparent for the 17 as it’s still the current model in the mid-range. The 17e and the 16 are still in the roster since there will not be replacement for at least six moths.
• The higher the memory, the higher the increase. Base models (256G) see increases of $100 but 1TB configuration Air saw a $300 increase.
• The Duo starting price is a reasonable $1999 which is probably where they wanted it to be years before launch. The more hard to swallow prices are in the higher memory configurations. The top of the stack is now $3200 vs. $2000 previously. That jump appears scary but the top of the range it’s likely to be far from the average (or median) configuration.

Fortunately we have the Leasing (Apple Upgrade) purchase option to determine the price/day at launch. Previously we would have to estimate the resale values years in advance but leasing means Apple does all the work for us.

The distribution of the daily costs for all the current models (and historic) is shown below:

This is the 24 moth option which is the only option for the Duo. Note that products that are carried forward had an increase in leasing price. The new median iPhone price (half the units are above, half are below) is $1.44/day. The minimum is $0.66/day and the maximum is $3.05/day. The base Duo price is $1.91.

One could therefore say that Duo stands for two thousand up-front or two dollars/day.

What are the consequences?

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