Wednesday, September 12, 2007

The immediate effect on supply-and-demand is not the only issue at stake when it comes to this (or any other) price-cutting decision: it also impacts the perception of authenticity ... we treat Apple as an exemplar of what we call "original authenticity." Almost everything Apple designs -- from its gorgeous computers and sleek iPods to its retail experiences -- seeks to stimulate in customers a sense of discovery and self-exploration. But what this decision seems to do -- and what the reaction from early iPhone adopters bears out -- is lessen the originality of the concept. It's clearly a swing for the masses, leaving behind those who saw themselves in the uniqueness of the design. It says the iPhone is a commodity like any other phone, not original enough even in its own designer's eyes to maintain a premium price. We thought the real Apple was better than that.

Jobs is being a bit disingenuous when he says, "This is life in the technology lane." No, such an immediate price decrease is highly unusual, smacking of desperation. Perhaps the iPhone isn't really the original breakthrough that Apple says it is -- but an iPhony! In this lies a lesson for all businesses: don't sacrifice long-term authenticity of your brand or your business for short-term revenue gain, as sustaining revenue over time hangs in the balance.

Labels: Apple, iPhone