Apple Does NOT Overprice Their Products | Change My Mind
Apple has a reputation for selling overpriced tech. While their products are quite nice, people often think that Apple stuffs in massive profit margins into each of their products. This is true for many of their meme products like their $1000 monitor stand and their $700 wheels, but in terms of consumer products, Apple is actually quite fair. If we analyze their quarterly report and normalize the numbers to the iPhone 13, we see that Apple only has a net margin of 20% or about $160. Now, are these super competitive margins in the single digits? Absolutely not. But, it's also not the crazy high 30-40% margins that many expect Apple to have. Moreover, most people don't buy iPhones for retail prices. They get it for $100 to $200 off by shopping for deals, going through their carrier, trading in their old phones, buying older generations, and so on and so forth. So, in terms of out-of-pocket cost that makes its way to Apple's pockets, for most people, it's well below $100 per iPhone. This video explains why Apple's consumer-level products are not overpriced, and why Apple's pricing is actually quite fair.
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Timestamps:
0:00 - Apple’s Profit Margin
1:26 - Cost Of iPhone
6:19 - Alternative Modes Of Monetization
7:57 - Higher Cost Of Business
9:41 - Overpriced Products Explained
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Interesting, I never really thought about it that way. This reminded of the fact that "luxury" fashion brands do exactly the same thing, D&G aren't making most of their money on fur coats that cost thousands of dollars, they're making it on the cheaper stuff, belts, perfumes, wallets which millions of people are buying because it's seen as an expensive brand, but they can still afford it. Thanks for the perspective.
Glad you found it informative!
I remember learning that this is why Merc bought AMG and why the M- series exists
Ummm ... Buying fur from farmers costs £3
No that is how they make there money. Apple is like Guuic. They are not doing anything that no one else is doing. When you buy Apple you are buying the Logo. The reason Intel wants Apple back is because AMD has been hammering them hard with there Ryzen CPUs and more and more people are building PCs with Ryzen and more laptop makers are using Ryze CPUs. If Zen 4 turns out to be really great Intel will be in trouble. I mean Microsoft and Sony already use AMD in there consoles.
@@evacody1249I had a stroke reading this
Well this totally changed my perspective on things, although I have to state, in countries that aren't The US Apple products are still EXTREMELY expensive, even taking shipping, import taxes, deliveries and storage into consideration. In South Africa we have exactly one licensed 3rd party seller that most closely resembles an Apple store (we don't have those here) and they price their products however they want because "it's Apple" heck their base iPhones often cost the same price as an iPhone Pro in The US, don't even get me started on the pro models, on some contracts the iPhone 11 PM went for around $2500 at launch in this country that's enough to buy you a second hand car. So after watching this sure, Apple products may not be overpriced but that only applies to Americans, outside The US they are still very much overpriced.
He compared apples to bananas. He should've compared it with other hardware businesses.
That's not something that contributes to Apple though, for instance in India govt. charges a hefty tax on imports, so iPhones are expensive here, but it doesn't contribute to Apple's revenue.
yeah well what youre technically saying is not apple's fault, thats like saying that one person buy all the iphones in stock from apple for the retail price then sells it to everyone else for double the price, thats not on apple but the reason the phone is so overpriced is beacause of that person who bought all the phones and is making a profit for himself
@@jamaairaja2666lmao now that they are manufacturing them in India they got even more expensive 🤣🤣
I think what bugs me about apple is less of their products price but more of their anti-right-to-repair activities like id-ing their batteries, many companies do the same but apple is one of the biggest offenders imo... its really horrible for sustainability :(
And how they try force you to buy their accessories. Android integrates awesomely with pretty much any device and OS. But Apple devices are often made to only work with Apple accessories by making it nearly impossible to integrate software in the device to support other accessories via apps in the official store ... unless you're Apple or make Apple support your accessories by basically shutting down everything non Apple related and follow strict guidelines.
Yeah their products are good but not made to last. Like who wants thinner MacBooks and iPad Pros? My iPad Pro bent and broke while it was inside the case
@@rephaelreyes8552 Hard disagree. Apple have definitely released some products that weren't structurally sound like the 2018 ipad pro and iphone 6 with the bending issues. Ironically I have a 6 plus next to me and although I'm not going to bend it, I use it for media and what not and it's chilling in a bag all the time that I lean on and it's not bent at all. Oh well. You see plenty of older iphones when you go out in public because they very much do last a long time, a 6 year old 6S Plus is still usable in 2021 and plenty of older macbooks are.
@@jonathandixon7518 Okay let me rephrase that: Apple products are made without durability in mind. The latest macbook pro as thin as the macbook air. It would have been better if they kept the same thickness as the 2012 macbook and made the heatsink or the battery bigger but they didn't. The same thing with newer iphones and ipads. It gets thinner each year that it's uncomfortable to handle them without a case on.
@@rephaelreyes8552 Huh? Are we living in the same universe? Apple has gone to make their iPhones and iPads thicker. iPhone 13 pro max has the biggest battery in an iPhone due to the increased thickness. The new MacBook Pros are thicker and heavier than last year’s as well. It will easily survive being in a bag. The regular Airs are thinner but will easily survive being in a bag which is all that matters. The new MacBooks get so much hype because of their performance and battery life are ahead of other similarly priced laptops. I’m very confused. I’m starting to think you haven’t seen a new apple product since 2016.
The analysis regarding the e.g. „screen stand“ is good:) However margin wise Apple should be compared to other hardware businesses. Also Apples strong ecosystem lock-in effect and its resulting ability to cross- and upsell could then be factored in. In addition Apple only allows downloads via the App Store (taking a solid cut on most transactions) and also puts their other services in a prime position on their phones that no competitor enjoys. Once this is factored in, and a comparison to other hardware manufacturers takes place, the results could turn out very different. Would be curious to see:)
Yeah, I completely understand where you’re coming from. Hardware companies of course have much lower profit margins because the hardware industry is cutthroat. But, I don’t think Apple is overpricing just because they don’t have the same razor thin margins. Now, if Apple had high 30 or low 40 percent net margins, they would def be overpricing. But I think 20% is quite fair.
The comment I was looking for
@@LogicallyAnswered Additionally to that the comment he made regarding: the AppStore taking a cut applies to the Google PlayStore as well difference is that A: The commission Apple charges is higher however as of recent they are forced to allow app developers get sales outside the AppStore. B: Them competing with other businesses on their platform is the same which Amazon does. Personally I don’t see an issue with it all and think your arguments are more than solid.
Everything you described about Apple's software and ecosystem is considered monopolistic. Back in my day, the FTC used to not allow these things to take over entire sectors of our economy. But then again, look how thin this phone is! 3 rear cameras?! Take my money!
@@LogicallyAnswered Bro u are a bit biased towards Apple and it's products!!?
What you didn't talk about was their ludicrous pricing outside of the US. That contributes to its luxury status around the world simply because they are taxed to death.
Yeah but that has nothing to do with Apple.
@@LogicallyAnswered iPhone 13 costs $1067.00 and 13 Pro costs $1601.00 where I live. But yeah, it has nothing to do with Apple.
@@NarendraMnr iPhone 13 is far Over 2000 dollars where I stay 😂💀☠️
i'll go broke if i buy an iphone
@@CptD1911 Lol
Also Apple purposefully makes their products seem expensive for marketing. They don't talk about value for the money, they focus on features and luxury. They know almost no one is going to buy their $700 wheels but that wasn't the point of them, it was to make Apple seem more exclusive.
No, Apple just wants to ridicule intel with their underpowered chips while their M series chips destroys their intel counterparts
@@wellszhou8286 ok sure
@@wellszhou8286 Yeah and also throw in the trash x86 compatibility a.k.a 99% of softwares
mkbhd has bought the wheels
yeah try and explain this to tech-illiterate iSheep that don't even know the difference between the iPhone 13 pro max and the 12 pro max, both are still the worst phones on the market but still iSheep don't know (՞ ᗜ ՞)
20% is still extremely high for Apple. Other companies with similar ecosystem-based approaches usually have very tiny margins if any on the purchase of the Main device. They get their money from accessories and software with high margins. But apple still has extremely high margins on those too
Its a cult, people buy Apple simply to flex on others even though is purely name and the money the show that they've spent.
True, I believe he made an incorrect comparison to Google and other software companies. He should have compared it to the mobile phone industry which runs on thinner margins (
Wow after going through the breakdown I've got to say that, maybe you are right. 10 - 20% is not much, although it is a lot of money in the end because of the scale. Even products that I sell personally I build my brands on the idea of 30% profit margins minimum out the door. With so much personal tailoring, software optimization, and research & development; Apple is providing good value and brand ratio. Their products hold their value, their products mostly last, are well designed whether software or hardware. I personally do not use Apple products, but I can confidently say that I invest in them because they are an actual good company.
Yep, scale is Apple’s ace card. Good luck on your business Lena!
After using a macbook I wish my company used macs. So much more reliable than the cheap window computers we get supplied.
I recently switched from Windows/Android to the newest Apple Products... (iPhone, iPad and Macbook) but I'm really disappointed by the software. There are so many little bugs and glitches, things that should work but just don't, or don't work well. I used to have an iPad 2 running iOS 5 flawlessly, but iOS 15 is just lacking. Apple needs to step up their game. But considering hardware, I'd say they're the best by far
There is still the problem of right to repair where Apple does some silly things. Lots of good content out now covering this topic :)
it is huge, the scale is indeed big, but way smaller than samsung's or xiaomi's, they sell more phones but apple is still the richest tech company, how comes so if apple is not overpriced?
Margins are always lower in hardware. Their margins are top of the curve for their type of products. Some of their products are definitely overpriced in the laptop and desk top space.
For sure, they have higher margins than most hardware companies. But their margins aren’t exactly unreasonably high or anything.
@@LogicallyAnswered It's all in what people are willing to pay. I have no problem with the price of their high end phones and that's the only route i go. But not willing to pay a premium for most of their other hardware. The price points on higher end laptops are crazy relative to what you can get in the non apple machines. And their monitor prices..LMAO. The mini's are actually a pretty good value with the M chip, you just buy the rest of the set up from other vendors.
Fair enough
@@johniii8147 for work and productivity activity the new MacBooks remain the best
Link me a cheaper notebook than the new M1 Pros that perform on par or better please.
Dude, shrinking Apple's relative margin by comparing them to the likes of Facebook, Visa and Google (completely different business models and products) makes little sense. Compare them to other hardware maufacturers and the "Apple tax" becomes pretty much undeniable. Also, how they monetize users via their service periphery is pretty obvious. Namely in the shape of exorbitant repair fees (which are artificially enforced) and the need to have special cabels/adapters in many very mundane use cases. And in the case of Macbooks, their margin is well higher than 20%.
Came here for this comment...this comparison is ludicrous lol.
Didn't he compare em with Mi and Huawawaiawa?
and that's what i think that the thumbnail didn't make scene at all like he compared them to company that don't sell smartphones at all and the whole apple tax thing is crap for apple too
exactly this makes the whole video useless. comparing apples to oranges
I was gonna comment the exact same thing 🤣🤣
For someone who has switched from Android-Windows-Linux to Apple's eco system, I feel the significant upgrade in all ways, the fact that the number of ads that I see has reduced significantly, the fact that the integration of all the devices is phenomenal makes it totally worth it!
Ive actually switched the other way around. And man freedom feels good. It's like android can do all the things that an iphone refuses to. Still i like both tho 😁
You definitely didn't have a Flagship android smartphone or high-end pc, if you think Apple is an upgrade
What do you mean with the ads thing
@@itwasag.ijanejoke386 had a flagship android (z fold 3), sold it and got an iPhone 13 pro max
@@b.c.7662 the s21 ultra is better than the Z fold. So you bought the wrong phone , or whatever a Z fold is
Apple made 94.6 billion in net income in 2021, yet paid 2.2 billion in income taxes. Think about that for a second. They sell the newest iPhone for, according to you 300-500 dollars above manufacturing price, on top of products like iTunes (software), airpods, iPads, Apple TV, cases, etc. They are the only company ever to be valued at over 3 trillion dollars. Despite this HUGE amount of income they receive, especially when you take into account the fact that they have a history of brutally treating and underpaying their workers, using unethically-sourced materials, etc. Despite ALL OF THIS, I am supposed to feel sorry for them because they paid a whopping 3% in income taxes. Get outta here.
Well it was a quarter, so it was more like 12%… but still very low
That giant tax book is a treasure map for saving money. If you’re paying taxes that just means you don’t know the terrain. Not saying I know how to use the treasure map but… 😂
As someone who does circuit-board and firmware development, I would be truly amazed that manufacturing the Iphone costs Apple 500 USD / phone. Every new iteration of Iphones looks almost identical to the previous version, so very little new development and changes are required. This means that, even when Apple releases a new Iphone, the manufacturing plants have their equipment already 99% readily configured and very little training is required for employees. This makes mass production extremely efficient and cheap. Most electronic components are in addition dirt cheap, compared to the end product itself. I myself order capacitors and resistors in quantities of 1000, for less than 10 to 15 USD. Price drops the more you order at once. Most broadly used electronics components (charging chips, power monitoring ic's, voltage controllers, temperature sensors, switches, ...) are less than 5 to 10 USD, these prices also drop the more you order at once. The typical empty circuit-board (without components) is priced based on size and complexity, I would estimate that this costs Apple about 10 to 20 USD. The most expensive parts are commonly the display, memory and CPU/GPU, together totaling to about 100 to 150 USD, if you order them from other brands. Apple uses their own CPU based on the ARM-architecture, which probably makes it even cheaper except for some licencing fees they have to pay ARM for using their architecture. When I'm designing something myself I always order prototypes locally in low quantities (8-12 samples). This costs me about 100 to 200 USD for on average 10 empty circuit-boards. Increasing my order size tenfold (ordering 100 samples) would only double the price, 100 boards costing me about 200 to 400 USD. Ordering 10 circuit-boards locally with the components already soldered on them is a bit more expensive, priced between 600 up to 2500 USD. But same as previously, I can increase my order tenfold for only twice or three times the price. The price drops massively if I outsource production to a third world country. Apple paying 500 USD to manufacture Iphones sounds reasonable, if they order them in quantities of 10. They in reality order them in quantities of millions, which in my experience should lower the price by at least 50% or even up to 75%.
I believe I have a good comparison. Take Samsung, they run physical stores, have the most staff of any phone company, design, manufacture their own chips and displays that even Apple buy, and still, they don't earn more than Apple even though Samsung is one of the biggest companies in the world. This just goes to show that Apple is not the only one doing these things that you say only Apple does.
You can't compare salaries in two countries. Cost of living is different in both countries. USA Is overpriced in everything, hence higher income. Income - expenses in USA might be lower than China
Quality of life is also different. You’re argument is worth nothing.
@@dudster_ Education is also different. Your trash talk leads nowhere.
@@4cps777 How so?
@@dudster_ Do you seriously not know about PPP?
In some countries the total cost of ownership for an iphone is actually less than a comparable samsung model due to the higher resale value
Ah great point!
Not true
Colombia will be a decent example of this
Very true! I bought the 12ProMax for round $1400 in Sri Lanka, one year late and a 01 year used 12ProMax still goes for around $1100!
@@samudithakumarasinghe2146 so about 300$ a year to keep getting newest iPhone. 25$ a month. Best part the average phone bill in America I would say Is $50(metropcs/mintmonile) to $100 (Verizon/att). In most countries where iphones don't loose value at all. Phone bill is 10-20$ (my bill in Colombia is 12$ 30gb lte the works). That means it cost me less to own and resell my iPhone every year and have a plane then the cost of an American plan
All these numbers are manipulated. Many smartphone manufacturers offer more for less price and they still make money. An iPhone lightning cable costs 25€ here in Germany. How can a lightning cable cost that much money?? it still behaves as normal retail cables for 2-5€ A very simple HDMI+USB-C Macbook adapter costs 80€, while the competitors offer similar quality with many more sockets for 1/4 the price. I'd like to see the detailed calculation of those iPhone manufacturing costs because a single iPhone that sells for $800 CANNOT cost over $500, unless R&D, shipping, and marketing etc. are also included.
I Agree!
Agreed 🙋🏿♀️ plus a lot of their research development comes from smaller tech companies and other brands like Sony who introduced waterproof technology as well as sound and camera advancements years before Apple. They just had to figure out how to do it themselves to avoid copyright infringement. I think they definitely inflate their input cost values.
Apple makes good phones at relatively reasonable price. No problem with that. My problem is that they control the products after they sell it. They make decisions for you without leaving option to the user. It might be OK for normal users, but for me that is a deal breaker. I want to have maximum control of my device. Emphasis on "my".
Everyone knows that already. I bought one knowing I would be happy with apple doing that. That’s why there is choice in the market, if you like control go for a android rather than turn iPhones into another android
@@junaidmzafar It's choice mate. As long as you are happy with yours, there is no problem.
if u want control just jailbreak it
@@fvs666 Yes, if u want to use it, just hack it. No problem to see here.
@@fvs666 I already have custom ROM installed for my device. I will never have that level of control in Apple
What i hate about apple, is their repair service! Also when you buy an iPhone you get like 70% of the phone and to use the rest of the features, you'll need: macbook, airpods, apple watch, also a charger to use the lightning cable, and + their services if you want all the features.
Take the current MacBook lineup for example. The *base model* of each form factor is very reasonably priced. But if you want more RAM or a bigger SSD, the upgrade pricing is at least twice as much as comparable parts for other computers would cost on an open market. It's like you said, the _spread_ of Apple's profit margins is just ridiculous, from very reasonable for entry level products to utterly ludicrous when it comes to higher end offerings. I think this inconsistency isn't being well received, especially since other tech companies have - or at least appear to have - much tighter profit margin spreads, resulting in more consistent pricing. Also, when comparing relative prices of e.g. iPhones versus other smartphone brands, you get a picture that's much nicer to Apple in the US compared to how it looks in many international markets like Europe or India. I think other companies do much heavier tax optimizations to get more consistent prices across the world, while Apple apparently optimizes solely for the US market? It almost looks as if Apple products were all billed as US exports even though it would make no sense given that they're manufactured in China anyway.
Here's the thing the past two years the only reason graphics cards cost so much or at least one of the reason is crypto. Take that out and no none of those GPUs are worth what they were going for. I mean dude a rx5700xt was going for more then what I first paid for and when I sold it I made money back on it. That's not how resale is supposed to work on used hardware.
this actually changed my perspective on Apple! I think I respect them more now. I am still an android user tho, but I will think more carefully for my next purchase.
Glad to hear that man! Feel free to stick with Android if you like it better. I wasn’t trying to convince anyone to switch to Apple. I was just trying to show that Apples margins are quite fair actually.
So, my conclusion is that if you just want a bunch of extremely reliable friends or tools, iPhones are for you, if you prefer more fun and customizations go Android
Dude u have more research to do! #apple #tesla
Lol......
@@wellszhou8286 you don't actually need to customise your android lol....
Comparing Apple hardware product margins with other software service providers didn't fit with me
Yeah, I completely understand where you’re coming from. Hardware companies of course have much lower profit margins because the hardware industry is cutthroat. But, I don’t think Apple is overpricing just because they don’t have the same razor thin margins. Now, if Apple had high 30 or low 40 percent net margins, they would def be overpricing. But I think 20% is quite fair.
@@LogicallyAnswered you should have replied that Apple is also a software company and provides their software as services too. Apple is software + hardware company. People who dont get it only see the hardware side of Apple. Make them understand this concept. **shudders
@@zeroxzero159buying their hardware is the only getaway to their software only relevant to talk about that , ok maybe Apple Music on android but not much
Apple's bare minimum products may be reasonably priced but if you want higher configuration(storage+RAM) they will fleece you. Currently their Macbook Air M1 8Gb+256Gb is selling at a discounted price of 65K INR but the same MBA with 16Gb+512Gb is priced about 132K after discount. If you double the RAM and storage they will extract double the price and they don't offer you any chance of upgrades. In MAC ecosystem only way to upgrade is to buy new device.
Apple makes more money by tieing in customers to their ecosystem. They make billions form just selling Airpods and apps.
True, but most people aren’t complaining about that. They complain about the hardware prices haha
@@LogicallyAnswered and when some people occasionaly do complain about it. They are made fun of saying, if you can afford to buy this 'premium phone' then why cant to pay for its services too. A clever tactic by apple when you think about it.
They make plenty of money from iPhones as well. For s company that uses cheap made in China labor, they do overprice their product. Imagine if in America Microsoft or visa paid them the same as those that make iPhones in China
@@TKUA11 You are forgetting that Apple’s single biggest moat is their software and they spend a fortune on paying their software engineers well
@@LogicallyAnswered I would say many if not most complain about the cost of the accessories, that you pretty much have to buy when you have Apple devices since its so hard to find good supported 3rd party accessories.
In my personal experience (working in the repair service) apples guts are the go to "look we used cheap alternatives to get a better camera" If that's how you cut the spending then follow that up with the software updates that fuck with your hardware in a negative manner... You don't deserve the 20% premium
Fair enough
Apple is overpricied in relative terms to their competitor. Samsung makes same phone with different OS with more feature which is usually less expensive than Apple.
Their baseline products aren't overpriced, their upgrades are. Storage and RAM costs a lot compared to everyone else
Apple charges $12.99 for 2TB of iCloud storage whereas its unlimited photo backup for pixel owners with Google. Also Gmail, Chrome, Google photos, calendar and Play store are all superior in my opinion having been an iphone user in the past for a while. I remember having to continuously delete files or photos to keep the phone running smoothly and also Apple slows down their older models very overtly and in a more stringent way than any other company I've encountered.
What about their $10,000 Mac Pro that can easily be built with parts that cost $3000 at the most? Or their $1000 monitor stand? 😂
How about their M1 MacBooks like the M1 Max, the cost was clearly all intel’s fault for the Mac Pro but the display stand is just ridiculous pricing, ironic they put the same display as their Pro XDR display on their 2000 dollar MacBook, guess you don’t need the stand
The stand is mentioned in the video. Just watch
@@wellszhou8286 wdym intel? As a company apple gets the chips for Way cheaper than us.
@@Darkest_matter Because Intel never innovated for a decade and charge extremely expensive chips, so, if Apple built a chip, it would be much cheaper with similar profit margin
You didn’t watch the video and it shows
They do overprice their products. Anyone who is willing to pay that much money for relatively bad hardware and also force themselves in the Apple ecosystem of proprietary spyware (yes, accept the fact that Apple is spying on you) where you're basically forced to buy another overpriced product clearly has either too much money or just no clue what they're doing. Don't get me wrong, Apple products themselves aren't necessarily bad but the price to pay is just way too high.
Their image of being a "premium" brand is the main reason why I never liked apple and all other fancy brands. It sells people the idea of being special, while the only special thing about them is their consistent lack of hardware and software adaptations, which prevents them from doing basic things like charging their device, using a mouse or monitor, or playing a game. In a world where following the masses means buying these "premium" products which are actually not premium, I am proud to choose differently. Change my mind 😂 or not, because you would have to change Apple's core business model to do that, and the masses, who vote with their money wouldn't like that
Interesting analysis. It would have been really amazing if you have added a comparison with samsung.. they are the real competitor to apple in smartphone industry.
Any new space videos coming soon?
Not really, I think I already covered most of the big space topics. If starship completes an orbital launch or something, I’ll probably cover it. But otherwise, I don’t wanna cover day to day news or anything.
I tend to disagree on "being forced" to use Google products. Because whether you are on iOS or Android, you will most likely end up using G products. And it is also inaccurate to say Google will serve you with ads on their phone, as Google doesnot unlike Xiaomi, OPPO, etc. They sort of serve some ads when you search, but when you don't no ad will pop up
But websites and apps show Google ads...
@@snakemaster2 that's not Google's or Android's fault. That's the developers' choice of monetization which may also be available on iOS devices. Goes the same as to some phone manufacturers that choose not to overcharge you but monetize by adding extra ads to your phones
Pretty sure with serve you with ads they mean with AdSense, not in the OS interface itself
@@chris_tahir I wonder why the developers chose google for monetizing their products, 🤔
@@liamsz unsure about this, perhaps there may be another ways, but not well-explored by many :)
Their margin is mostly from hardware, their services are but a margin of other companies. The hardware is still terribly overpriced.
The statement "iPhone 13 is overpriced" means it is overpriced relative to the competition. It means apple is charging $800 for what others charge $700. Not that apple makes ridiculously large profit margins on iphone 13. When somebody says "apple products are overpriced", they mean "apple products are overpriced relative to the competition" They never mean "apple has ridiculously high profit margins".
$800 is definitely not overpriced. All the biggest brands sell their top of the line smartphones for $800-$1,400 on average. If you want some cheep, plastic phone that won’t last over 2 years then go buy a cheep $400 phone.
@@dimaisatree Read my comment again I never said the statement "iphone 13 is overpriced" is true or iphone 13 at $800 is overpriced I used that statement to illustrate what i wanted to say
I totally agree with, it was the same conclusion i came to. We don't need to see it from companies perspective rather customers.
I would prefer an iPhone that gets software support over 6+ years than android that gets abandoned over 3 years making it insecure
@@edd9581 Ok, but what does that have to do with what i said?
Sad fact: some people hate apple because others do,no real reason they just wanna look cool and think its 2016 yet they dont even know specs doesnt mean better some of the time
Most people that hate apple own some apple products. One of the biggest turn offs with apple is the difficulty to repair their products. I want a faster laptop but each year they make their MacBooks harder or impossible to repair. Their products are not made to last and you can build your own computer that's cheaper and outperforms their Mac Pro. Don't get me started with their arm technology. Their M1 chip is very good and the way of the future but the fact that the SSD and ram is solder in mean you can't upgrade those. These days 1 terabyte isn't enough. Most AAA games exceed 100 gigs. Does an addition of $800 for a 2 terabyte ssd seem cheap to you? With a Samsung ssd, the difference between a 500 gig and 2 terabyte storage is only $150
@@rephaelreyes8552 but some people just hate it because Many people does
@@noone5539 I guess? But some people just don't bother articulating themselves or to think of key points of why they hate it. It's like asking a kid why he likes ice cream. The most likely response is "because I like ice-cream".
>Sad fact: some people hate apple because others do, Yeah no, there are reasons to hate apple, biggest of which, they purposefully make their products hard to repair and forcing new standards on customers without giving them a chance to transition, this is something every other tech company at least has the decency to do, give their customers time to transition to new standards before phasing old ones out.
@@zaremol2779 not the brand but the product
Agree with most of this, Apple makes a good chunk of it's profits from accessories and services...but one thing, if you're going to go the hardware route, compare them to other hardware companies (Lenovo, Dell, Asus) They can post such margins because they're an end-to-end information technology company (They do both hardware and software) with a very strong product ecosystem
Finally someone who understands Apple's business strategy.. most comments are blind to the fact that Apple MAKES THEIR OWN SOFTWARE TOO.
@@zeroxzero159 and you pay for it TOO. at the end of the day i need to call and text and get email. any phone can do it and just as fast for 1/3rd the cost.
Great video man . Got a whole new perspective about apple products. 👍
They Spend Big Money Making These Devices So We Can Have Good Devices So I Completely See Why Apple Charge What They Charge 💯
Glad to hear that Uday!
Tru
It's not really accurate to say that Apple makes these innovations and others can simply just copy. It's actually the opposite, often times it's other companies that do it first and Apple is late to the party and just simply copies what sells well so they can avoid the gimmicks that aren't profitable
Partly true, it's true that Apple often does not do it first, however, they do spend a significant amount of time and resources to do It better. That normally does get copied by competitors. To me, that's a win-win.
I haven't watched the video but I already feel like he showed the 1000 dollar stand
That sweet sweet chunk of appstore revenue share is what really fills their coffers. The iPhone is just a gateway into their ecosystem, their "walled garden".
Great points! Something that you can/could add was iPhones have the longest shelf life. With iOS updates and feature updates for 5+ year phones that no Android phone manufacturer can even dream about the same.
Apple pays 168k per year for software engineers but still can't fix the issue of wifi captive being dismissed if an Otp is required, or putting WhatsApp call on hold, and allowing swipe down view notifications
I grew up calling companies like Apple "monopolies" Don't simp for the big guy
Except they aren’t one company controlling everything you’re just an idiot
the problem is that marketing costs are higher than ever and they take it out on the consumer.
I would challenge the premise - Arguing that their business expenses are high does not mean they're not overpriced. I can usually find a laptop with an SSD and 16GIG of RAM for
I love your videos. I'm your number one fan. Keep posting great content 👏👏
Thank you so much for your support Rodriguez!
Using excuses to defend a product is not a valid reason, as to why they're overpriced. Apple is always late to the game in virtually all technology, leaving their hardware outdated. The same hardware in other devices always outperforms Apple products, as Apple is just simply not good at optimizing for their OS. To further this, Apple holds the rest of the world back in a lot of technology because they won't update theirs. The main one and the most important for general consumers is RCS.
Shut up nerd. iOS and MacOS are supremely optimized
And usb c
@@lltheFacell lightning where usb c is desired, and usb c where other ports are desired but hey you can always get those dongle for $40 bucks each right?
What you said. The rest of the tech world will take a step forward then Apple pulls it back three or four steps because they are not ready. I mean really the whole 120hz on an Apple laptop last year was one of the big things. I mean really at this point no one cares.
You will never convince me that the hardware of an iPhone costs $526 lol. Maybe that’s what Apple prices all those parts at
You literally didnt listen at all. It is not just the hardware, someone has to design the thing, write the software, maintain the software for many years, etc.
@@quAdxify Thats all bs, there are many phones today that match a iphone or are around its overall performance for much less money. Apple seems to be mostly name working for the brand, Apple isn't the only phone company that does that they aren't gods and they didn't invent phones either.
@@Burago2k sure pal
Can you do a video about amazon's structure and strategies just like this video.
How much do they make from app Store?
Well after watching the prices of apple products outside of us .... Yeah apple pricing is way too HIGH... Like it's so much that you can literally build pc
That is not apple Company fault, problem lies with Import tax of respective countries.
Well, from our perspective, they are still overpriced compared to say, samsung for the same performance
I really do think the case is different for other apple products like the airpods or the apple watch both of which have really high sales as well as pretty high prices . It would be amazing if you analysed those products the same way ,this iphone was . I really do think those are overpriced . Would love to get a reply!!:)
This is a good argument from the business side of things. However on the consumer side of things, people at stores aren't looking at the quarterly reports to say an iPhone is overpriced, but rather the lack of features for the price asked for one. However Apple's position as a trendsetter helps them as they can influence other brands to copy them in their quest to delete features and get away with it by offering a better choice of materials and design for a premium experience.
This guy: Apple does not overpriced their products Apple: **sells $700 pc wheels**
And $19 Polishing Cloth
Dont forget the $1000 monitor stand $1000 for a piece of metal
he literally tried to explain that. you didn't even watch till the end i guess
You didn't watch the video fully@@suntzu1409
I use Google phones currently and have been for a couple years. IMO I think you get more bang for your buck, such as the iphone SE or iphone 11 they have small screens and not the best cameras as for pixel phones they have a more than average screen size (not that you need a huge screen) and a very good camera for the price. I do think they are over pricing their stuff by 15-20% which is obviously a brand thing because they are exclusive which is an interesting idea but other companies like Samsung and Google are overtaking then by making cheaper phones while still maintaining performance and quality in turn for being less socially acceptable brands but who really cares as they really are actually pretty good at making simple but quality phones. For software apple is really land locked and you don't have much flexibility for apps and customization but android does as they are almost used by every other good company. Hope this makes sense and drop a reply if you want me to explain or need more details.
They only earn 20% margin, because they spend money on anti-repair lobbying, spending R&D for parts to not be replaceable, fighting anti-monopoly lawsuits, creating copyrights for basic ideas/features that should not be copyrightable in the first place.
joined your channel at 3k subs and now nearly 200 k subs. Congrats
Thank you so much for your sustained support Wi!
Great video. All are amazing. Waiting for more hedge fund videos ☺️
Thanks for the suggestions man!
@@LogicallyAnswered most welcome bro
when you consider the products holding their value for years for you to resell at a highish price, that by itself makes them cheaper in a way, since you get some of you rmoney back
I love the quality of your more recent videos but the clicking every time there is a still image is driving me insane. Keep up the great content tho
Thanks man! We were trying out a higher quality editing style. A lot of people have commented about the clicking sound, so it looks like it was too much. Starting next video though, we’re using a much more subtle sound effect instead.
@@LogicallyAnswered As your channel grows you may be become too stretched to keep listening and replying to your commenters but I for one will enjoy your personal touch as long as you can keep squeezing it in here.
Main reason I’m not getting an Apple device in the near future is because of their stance against repair. High price isn’t enough for me to boycott a company. If I want a true *work* computer, I wouldn’t do a MacBook because their poor thermal design and priority of thinness means they almost never are able to operate at peak performance for any length of time, so their decent specs are almost meaningless. But I do enjoy using the OS and the hardware. The touch control is amazing. Just wish they would stop being scumbags
It's changed since M1 Max and Pro babe. Those are the fat children of the family.
I like the way you call the products "overpriced" Also, yes. They sell overpriced products. Nothing is going to change the fact that your average iPhone costs more than your average Android.
There's a difference between expensive and overpriced!
yup so true and that you can better better android phones for cheaper then apple-
And nothing is going to change the fact that you’re slow, biased and can’t understand business.
Nothing is going to change the fact that your average mansion costs more than your average studio apartment. When you buy an iPhone you're paying for hardware, software and services, plus R&D and retail costs -- because Apple makes iOS and maintains the services. When you buy a (for example) Samsung phone you're just paying for the hardware and retail costs, because the software and services are paid with your data instead of your money and are provided by other companies. You're paying more because you're paying *for* more. That's literally the opposite of overpriced.
You forgot the fact that Apple products are more expensive outside the US
It’s because of foreign governments tariffs and taxes
Yeah, that has nothing to do with Apple haha
Tax of government
@@LogicallyAnswered It does? If every other hardware company can produce them locally, then why can't Apple?
Great video! Totally new perspective
Very interesting, I really thought that apple make like 40% margin really good to know. Thanks for the video quality
After watching this I'm totally buying a Google Pixel. I support advertising as a business model. Too many businesses target businesses and individuals out of pocket expenses and most importantly KZheadrs make money off ads. Indirectly. And I'm a KZheadr so I care. I'm difently not buying apple now. Thanks for the video. I'm convinced that Apple is too over priced!! 20% for making money UPFRONT!!! should be 10% and sell more products that change the world.
Fair enough. I don’t have a problem with the advertising business model either given that I’m a youtuber as well. I also don’t think 20% profit margin is too high especially when you consider that most software companies have profit margins above 40%. But to each their own.
Based on the performance of the last few pixel phones I‘d reconsider.
Apple isn’t only a software company 🤔
A mid range android has the same internal specs as a top of the range i-phone..In terms of low profit margins in hardware,what adds up and what doesn't
Even high-end Android phone does not have the same specs as the tog iPhones let alone mid-range, and specs are the most useless thing ever in a smartphone, does megapixels equal better photos, no, iPhones 12megapixels and Google megapixels outperformed competition for years even with a 12-megapixel sensor, I think Android does offer more value then iPhones in the mid-range categories, but would come nowhere near the high-end iPhones in camera's, performance, all the fundamentals of the phones, the only thing Android mid-range could outperform iPhones is the display if 120 hertz on the non-pro models or has a ridiculously big mah compared to the mini iPhone version, otherwise, the mid-range phones is no where near the same level as the new iPhones
@@wellszhou8286 my Xiaomi that's £300 new is comparable to I'd say an iPhone 12
@@Darkest_matter The problem is specs doesn't matter, the real-life experience does, and for the camera's the iPhone easily beats out any Xiaomi phone below 700 even if Xiaomi has 200 megapixels on their camera, their displays are lacking in terms of refresh rate, but they have an overall better display, their water resistance is clearly better then any xiaomi phone, even their Mi 11 Ultra costing 1350, their battery life is noticeably better even with lower MAH, their chipsets are way ahead, you name it, plus longevity support, I'd say, the iPhone annihiliates these types of phones as they are still supported on my 6s, so, their you go, specs does not matter, real-life experience does
And the Android is still shit lmao
Yes they don't overprice their products Proceeds to buy $100 Dollar Apple Polishing cloth
Since M1 launch in laptop category M1 Mac and all its higher versions perform same as the windows laptop which literally cost twice of apple products. In intel chip era things were in windows' favour.
Not anymore. They used to but the MacBook Air hasn’t gone up in price in 10 years…. Also tho, apple products last longer. I’m still using my MacBook Air from 10 years ago, I’ve upgraded my gaming PC 3 times in the past 5 as parts go bad
That's not a fair comparison, the ability to load a Web page and process office documents hasn't increased in its computing requirements. PC games have.
@@felixtcat85 Good point I had not considered.
Wow, if company is paying high for their workers , engineer and their technician , that doesn't mean we have to cover their expenses. They need to find cheap labour or open their company where labour cost is cheap.
I know an Apple programmer who jokes about getting a good salary for doing little work. Paying higher salaries does not equal quality. When I was in university it was the ideal job for not-so-hardworking programmers. I’m not sure if that’s still true today.
The answer can be summed up by apple makes profit from hardware and less so in software due to not using targeted ads. Sure they spend more money on R&D and sometimes innovate drastically (see m1 and iPhone which are insane innovations tbf) but that doesn't mean the products after the innovation has been around for a few years is priced correctly. They also take products from other competitors and "innovate" on it alot. See air tags, (can even argue Chromebooks lead the way to m1), apple tv, possibly now evs. If apple removed all privacy and added ads or bloatware into it's devices I don't think that they could sell at competitive prices. That being said privacy is insanely valuable and I respect that apple is selling more of a product then Samsung or any Android provider. The biggest reason I think it's still overpriced is that you don't actually own it (even though you are paying extra for it as opposed to a Android phone).
You can't compare a hardware company's revenue with a software company's margins. I use Google, Microsoft and Facebook products but I've never paid them any money, so I don't care how much profits they make. But I'm directly paying Apple $1000 to get in their ecosystem and they make 25% of that as profits which is a lot
Thank you for pointing out this flaw in his research! I was just going to say the same thing. It's incredible how many people have fallen for this and now they feel even more assured that they are making the right decision while actually buying overpriced products...
@@ReverieFlows he's from india , he can't afford one that's why he's hating on it
@@Amzzyvlogs just read the comments. For real, simply read them. While we are laying out flaws in the research of the video creator, you are simply hating on us, even though we weren't even criticizing Apple in the first place. The video title literally tells us to change the mind of the creator. In this case it's only logically to point out fatal flaws in his arguments, that change the whole debate. You can't compare a company that focuses on hardware and the supporting software (Apple) to a software only brand like Facebook (excluding sister parts like Oculus VR or the horribly failed Facebook Portal). The only thing connecting them is the branch, but they're completely different companies. It's like comparing the statistics between a bike company and a car company. Yes, they're both used as types of travelling, but you should never see them as comparable. It's simply giving a false view on the industry. He should compare Apple to Samsung, Huawei and other primary smartphone makers. If he wants to compare Facebook, than he should do it with snapchat and other mainly software driven companies. In the end of the day I don't care if Apple overprices in comparison to others or not. If somebody wants to prove one of those things he has to to back it up with thought through arguments and facts. This video couldn't deliver these checkmarks and the both of us pointed THIS out. I don't care if you use an iPhone or not. But I do care if someone widely spreads misinformation on the market. I personally use a Samsung smartphone and my life evolves around the Samsung ecosystem, but I would equally care if this misinformation would be in a "pro-samsung" video. Big creators have big responsibility, since many people listen to them and trust them to deliver true information. Flaws like these accidentally happen to everybody, so we pointed them out. Of course I didn't expect the creator to really act on the criticism, because his whole video is based on this misinformation. But I hoped it would at least reach some other people and bringing them to actually start thinking about the false / badly applied methods used in this video. But you just hated on us, since our point seemed to intervene with your opinion, but it doesn't. If you like Apple products that's no problem at all, but thinking this video actually validates your thoughts is one. I personally never wanted to attack Apple or it's users, but I stand to my criticism on this video since it's poorly argumented and delivers an untruthful result. PS: I think it's unhealthy to insult MULTIPLE people in this comment section as Indians, even though your channel states that you are Indian yourself or at least live in New Delhi. Please tell me how your obsession with calling people Indians started out in the first place. It's simply weak or even pathetic to call people names and disrespecting others just because of a different opinion or preference. Your opinion is not superior to others and never will be. So either shut up entirely or actually read others approaches and lay out your own arguments. Nobody profits from your non-adding comment except your still increasing inflated ego.
i'm still not going to pay 800 dollar for a phone. lol
Yeah, that’s completely fair Eric. I’m not trying to say that Apple products are worth it for everyone. I was just trying to show that Apple doesn’t have insane 40%+ margins like many expect.
@@LogicallyAnswered i know, And that's why i like your video's a lot keep up the good work. Much Love from a fan of your channel
Awesome and the way he calculated tax and added it as cost for product is simply ingenious And the way he explained how pixel is more expensive than iphone was totally out of this world.
interesting take on the topic, thanks for sharing!
How much do they earn thru the apple store? The main difference in my opinion when it comes to apple vs other brands is that you have to pay for everything. Also when it comes to services, why is it that they want customers to get replacements rather than repair? Software quality is debatable but I think their after sales service isn't all the great.
This sounds like Apple whitewashing. It’s illogical to logically answer Apple having lower margin with your choice of companies to compare with. The main difference is that most of the chosen tech company for comparison does not have physical stores. Apple insist on having its own physical stores side by side with other sales channels for the purpose of marketing and brand awareness. These cost are then compounded onto the customer with it’s margin without making it’s product any better. The only way to judge whether something is overpriced is it’s value for dollar which probably can be measured by specs for price in the hardware industry.
I understand where you're coming from. The problem though is that the hardware industry has cutthroat profit margins. So, it's not fair to say that Apple is overpriced just because they don't have the same cutthroat margins. As for the Apple stores, as you said, these are a major part of Apple's branding and service. I don't think there's anything wrong with buying from a competitor that doesn't have such stores. This way, none of your money goes towards running them. But I don't think it's fair to say that Apple is overpriced just because they have stores. That's like staying at a hotel that offers breakfast and then claiming that the hotel is overpriced because you didn't need the breakfast.
@@LogicallyAnswered look at and then text review of Apple A15 processor. They are providing a top-class processor that has amazing performance in minimal power usage. From a hardware perspective, if I'm getting the best processor than well that makes it very hard to ignore. I'm switching over to Apple very soon at this rate due to the performance. Apple frequently has dedicated Hardware that makes its product Superior. Combined with how the ecosystem integrates everything I think that sometimes people forget just how convenient and Powerful that can all be together in one package. From a purely objective point, the Apple ecosystem at this point is easily justified by the cost charged.
@@LogicallyAnswered I was comparing Apple App Store with Google Play Store, they are pretty much a 1:1 comparison. US customers might not know this but in most parts of Asia for the same game that is listed on both Apple App Store and Google Play Store, the in-app purchases (virtual purchase which are just made of binaries) in Apple App Store is 10-20% more expensive than Google Play Store. This is pretty much a rip off.
@@linhaohoward They both are trash and the reason the developers charge more is because of their greed, in Android you can jailbreak and sideload but in App Store you can’t do that and I respect that because then it gives consumers more choice, Apple’s reliable, safe, secure system or Android’s fun, less-restrictive, but not as reliable operating systet
@@LogicallyAnswered Apple doesnt have cut throat margins because it doesnt price iphones like Xiaomi and oppo do For eg., Apple charges $500 for what Xiaomi or Oppo would have charged $400 Apple keeping higher profit margins requires prices higher than what Xiaomi or Oppo would have sold phone for "iphones are overpriced" statement means iphones are overpriced relative to the competition It means a $800 iphone is only as good as $600 Android phone It doesnt have anything to do with profit margins at all It isnt in an absolute sense And comparing apple's profit margins to the profit margins of microsoft and Visa is just plain stupid
In india, apple is surely over priced. Mainly due to the import tax. 999 usd iphone = 1,30,000 inr rough but about 80,000 inr for samsung.
Yess
Sure, but that's not Apple's fault. The Indian government's predatory taxation makes their products more expensive than they should be, and Apple can't do anything about that.
Yes, they overpricing especially ram expansion and STORAGE for performance. They also save on cooling. I get why MacBook Airs are double price of Zenbooks. Fair enough. But 250 USD (euivalent in Poland) for expansion of RAM to mere 16 GB ( which in 2023 should be baseline ) is definition of highway robbery. Just like slowing down storage by using single die instead of two.
any company with "proprietary" parts can overcharge if you can't get the commodites parts like RAM elsewhere, which you can't if it's soldered down.
You mentioned the margins of software companies. No hardware companies, and none of their competitors margins, Samsung, Huawei etc.
A lot of products are definitely overpriced compared to products with similar and better specs but we don't mind, because we buy the brand and we know it
That’s true. All of the comparisons were software companies except Nvidia. Hardware companies generally have extremely low profit margins, so Apple does have higher margins than most hardware companies. But that doesn’t mean that Apple has unfairly large profit margins. I think 20% is fair.
Compared to Samsung its a huge difference. Like iCloud works perfect, while Samsung is shutting down Samsung Cloud and working with OneDrive. Everything feels much more Premium.
I love the reliability that apple gives especially with the software, if you keep your phone you will be getting supported software updates for like 7 years until hardware limitations yet in the way
if we compare macbooks to other windows laptops how do you justify the price of some windows laptops of same performance being lower ?
Hmm… have fun finding a windows laptop that costs same as M1 Air and having same performance
@@derekzhou4750 bro im sorry i tried to answer to you it was a friendly and polite answer very long and detailed with links and stuff and i really cant be asked to write that again but for some reason youtube decided to delete it prompting me to be kind and respectful i swear we would have become best friends after that but hey guess its not destiny hoping this doesnt get cancelled as well
@@majajatasi Oh, I am not the one reporting the comment
@@majajatasi Well, I am usually a friendly person
@@derekzhou4750 dont worry not blaming you i know its some algorithm from youtube ive seen that in the past 😅
Apple items are already expensive in general when using a base price which are typically higher than the base price of a Dell or Microsoft product. Stack that with the resistriction and they force you to buy ONLY their products to make their other products functional like buy a apple earphone that cost an additional $200 when you could buy a $30 earphone to use with Microsoft and Dell devices. Another crazy thing about Apple is fixing their products somewhere tend to be expensive af compare to fixing a Microsoft, Google or Dell products. Apple margin aren't high but because the brand has a luxurious name everything that is attached to it is still expensive. You can get a typical smartphone from Nokia, Samsung and Huawei for say $500 whereby a typical Apple phone cost $650 stack that with repair and other maintenance cost and you got a bankruptcy phone with ya.
Clever analysis, as always.
Thanks man!
I'd rather buy apple stock than apple products lol 😂
An issue with comparing Xiaomi and Huawei worker compensation. You can't say Apple pays way better when the cost of living in China is way lower as well
The insane amount of marketing spend is also part of that cost of sales and that's not hardware cost. Not every consumer wants to pay for very expensive marketing decisions made by a company.
Mkbhd might have a decent future in hand modeling 😂😂
😂
Waaay too many assumptions and extrapolation in this analysis.
Yes it's not overprice they sell stand at 999 instead of 1000€, that's so nice of them
Hey will you make some space companies related videos 🌝
If something big happens yeah, but otherwise I don’t think so. I just feel like I’ve already covered all the big projects.
Maybe they dont but I still wont pay 700$ for a phone, my 400$ Android is already high end
Fair enough
The problem is that ur 400 android ain’t high end
@@simply6162 depends on the purpose for which you need a phone
@@simply6162 most people use their phone for texting, calls, social media, and KZhead. I'm sorry to say it but any modern phone is pretty fast and responsive and will do almost everything that most people need
@@sylfix2680 many people need an iPhone for more than just calling and texting, they need it for the convenience. We live in a digital world, you need an iPhone with you to make life easier. Can you get buy w/o it? Sure. Will having it make your life easier? Yes.
We're comparing their products to their competitors', not to VISA. Apples to apples, dude! My Galaxy S10+ is 2 years old and was considerably better than its iPhone counterpart when I bought it, and is now very favourably comparable to the latest one. My value for money is thus insane. So yes, the average consumer IS overpaying for what they're getting.
I understand that perspective. A lot of apple’s smartphone competitors have razor thin margins in the single digits if not negative. So, you can usually get better value with competitors. But that doesn’t mean that Apple is overpricing. Apple is pricing fairly while a lot of the competition is offering a steal.
@@LogicallyAnswered Point taken. Now that I've researched it more, taking a look back to my example (pun intended), the S10 cost $420 to build and sold for $999. I imagine the margin for S10+ must've been even better.
Apple products don't go on sale, so the information in the video is incorrect. There is no waiting for Apple sales from any stores. U can buy used, or trade in ur old phone, but that's still doesn't mean their phones aren't overpriced. Other companies phones have better specs at lower prices.
explain the 19$ Apple Polishing Cloth. :)