Why aren't smartphones cheaper?

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Why aren't smartphones cheaper?

Postby pittsoccer33 on Tue Oct 22, 2013 11:06 am

I hope someone who works or has worked as a rep is on this board.

I can't figure out why smartphones continue to cost twice as much as tablets. I know there is a cost to miniaturization, but not that much. The bill of materials on an iPhone is something like $200. I know there is a lot of R&D, warranty costs, and other considerations that need to be built into the price, but what is keeping them inflated so high?

The iPod touch sells for under $250. It lacks a few [cheap] radios and probably some other electronics the phones have, but not $300-$400 worth of parts.

Google sold out of Nexus 4 (very similar component-wise to the iPhone) upon dropping prices to $200 (contract free). With Tmobile ending phone subsidies (you will finance it over the life of your contract) and other providers doing similar things will that force cell phone prices down?
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Re: Why aren't smartphones cheaper?

Postby Idoit40fans on Tue Oct 22, 2013 11:07 am

Because people pay for them at the prices they're currently at.
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Re: Why aren't smartphones cheaper?

Postby pittsoccer33 on Tue Oct 22, 2013 11:20 am

Idoit40fans wrote:Because people pay for them at the prices they're currently at.


People pay approximately $200 and have the rest of the cost hidden.

What is the price difference on the new ATT Next plan? An iPhone 5 costs nothing down, but $32.50 a month - $390 over the course of the year.

I've been buying unlocked phones for $400-$600 for a few years now because I can sell it after a few months for 75%-90% of what I paid for it and then buy the latest phone.
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Re: Why aren't smartphones cheaper?

Postby shmenguin on Tue Oct 22, 2013 11:22 am

but the answer is still, "because they can be"
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Re: Why aren't smartphones cheaper?

Postby viva la ben on Tue Oct 22, 2013 11:25 am

I paid 200 for my 3GS in March of 2010, and 200 for my 5 in November of 2012. I'll pay 200 for my next iphone November of 2014.
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Re: Why aren't smartphones cheaper?

Postby pittsoccer33 on Tue Oct 22, 2013 11:28 am

viva la ben wrote:I paid 200 for my 3GS in March of 2010, and 200 for my 5 in November of 2012. I'll pay 200 for my next iphone November of 2014.


You're paying for the rest in monthly service contracts. Tmobile is getting rid of subsidies all together. They started by lowering the monthly plan price to anyone that brought their own phone. The other carries are starting to follow suit by offering you the ability to get a phone for "free" and then jack up the monthly cost.
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Re: Why aren't smartphones cheaper?

Postby viva la ben on Tue Oct 22, 2013 11:33 am

I got a FAN 23% discount through Att
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Re: Why aren't smartphones cheaper?

Postby DelPen on Tue Oct 22, 2013 1:12 pm

Are you looking at comparable specs? a 4G tablet unsubsidized costs about the same as a phone. An iPod touch is less than a tablet.
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Re: Why aren't smartphones cheaper?

Postby Pitt87 on Tue Oct 22, 2013 1:15 pm

I think the iphone still sets the market price, and Apple doesn't compete on price. Several analysts suggested to Apple to release an ultra-high end device to push prices up. Would not be surprised to see carriers resisting a price increase on handsets to avoid raising the monthly fee to keep the price ~$200 on contract, however, since there is little differentiation in their products.
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