The iPhone Xtreme
By Alyssa Tomfohrde
On November 3rd of 2017, the iPhone X was released all over the world. This was the tenth anniversary of the Apple’s iPhone, and with the brand new design and face recognition feature, there was a lot of craze about this new item. People all around the world were excited for the launch because it was supposedly new and improved from the past phones. Since there were so many people excited for the item, it was in high demand. Knowing this would happen Apple thought they were prepared, but ended up having a shortage of supply, since they sold out within minutes of the launch due to the earlier available pre-order that many people took advantage of, which broke a record for pre-sales the day before the release. Though, this isn’t some small purchase at all. The phone itself costs $999 USD which you could round up to say that it costs $1,000. For some who are in the lower and middle classes who cannot afford to drop $1,000 out of nowhere, they have to weigh the pros and cons. If the marginal cost of the phone equals the marginal benefit for a certain individual, it would make sense that they would buy the phone. If the features seem exemplary and worth it for the cost, then it is worth the buy. With this big expense, there are many opportunity costs of the other things that money could go towards. The money could go towards groceries for the week, the electric bill, water bill, gas money, even could be used for their current phone bill, though these people bought the iPhone. The substantial amount of sales made the profits of Apple reach a new growth of 19%. Because of the new and advanced technology, this rose the GDP of the country because of the production of the good. 
From Black Friday to Cyber Monday, U.S. Cellular was having a deal for iPhone 8’s and iPhone 8 Plus’s where the 8 was free if you turned in an old phone in good condition and obtained unlimited data, as was the same for the iPhone 8 Plus, though instead of being free, it was installment price of $3.30 per month. Though, there was no deal present for the brand new iPhone X. Since the iPhone X is so new and more popular, it is an inelastic good whereas the 8 and 8 Plus were more elastic goods since they aren’t in as high of a demand as the iPhone X was. Therefore, the iPhone X has caused an extreme change in the economy.
Works Cited
Franck, Thomas. “Apple Shares Rise to All-Time High on Booming IPhone X Demand Reports.” CNBC, CNBC, 30 Oct. 2017, www.cnbc.com/2017/10/30/apple-shares-rise-on-booming-iphone-x-demand.html.
“IPhone X.” Apple, www.apple.com/shop/buy-iphone/iphone-x.
Rushe, Dominic. “Apple Shares Hit Record High as IPhone X Pre-Sales Fuel 19% Rise in Profits.” The Guardian, Guardian News and Media, 2 Nov. 2017, www.theguardian.com/technology/2017/nov/02/apple-profits-shares-record-high-pre-sales-iphone-x.
Smith, Chris. “IPhone X Sold out in Just a Few Minutes.” BGR, 27 Oct. 2017, bgr.com/2017/10/27/iphone-x-sold-out-ship-times-slip-minutes/.
Zumbrun, Josh, and Tripp Mickle. “How Apple's Pricey New IPhone X Tests Economic Theory.” The Wall Street Journal, Dow Jones & Company, 17 Sept. 2017, www.wsj.com/articles/how-apples-pricey-new-iphone-x-tests-economic-theory-1505660400.
If people in the lower and middle class save up 1000 dollars and then finally have enough money to spend on this phone. they won't have any extra money to buy any other not needed items. Because the demand for this phone is so high it will effect many businesses economically because the amount of people who spend their extra money on phones.
ReplyDeleteI agree that the iPhone has invariably changed the economy, but the economy is definitely all it has changed. The creation of the iPhone and smartphones in general created an entirely new market for new goods and services never before seen in our economy. The production of some of these goods has raised the GDP of the US, but the production of the iPhone would go toward China’s GDP since it is produced in China’s borders.
ReplyDeleteit is crazy how such a small thing causes a huge effect on the economy. The iphone X broke recorded and is in high demands but what about the pixel 2, how did this phone affect the iphone X or did it even do anything to it. In addition with the high demand for the iphone how did Samsung replied to this new and improved phone.
ReplyDeleteIt's crazy that so many people want this phone because its not that much differet. The design is new, but kind of ugly I think, the camera is slightly better, and the charge only last 2 hours. For $1000, $200 more than the 8plus and $300 more than the normal iphone. I wouldn't pay more for minor changes, new emojis, and sideways camera.
ReplyDeleteI love seeing Samsung taking advantage of the hype around the iPhone X. Their most recent commercial shows one of Apple's faithful customers and how he stood in line to get the new iPhone every year. Samsung focused on all the problems the previous iPhone's had and how they never really fixed them. For example, the headphone jack, the lack of storage, etc. So I feel that this outrageous pricing of the iPhone X will benefit Samsung with a surge of people switching brands.
ReplyDeletePeople are always worried about having the next most improved technology, phones being a perfect example. As soon as the next phone comes out, people want to update their perfectly working "old" phone that they got last year. Often times I feel like people prioritize a new phone over the more important things in life. When I was on my mission trip in Detroit, I came in contact with a lot of individuals who had almost nothing, but had a better phone than me. I find this really interesting that people are willing to take on an opportunity cost like nicer clothing, a healthier meal, or even Christmas gifts for their kids just for a new phone. A phone can be essential for working, communication, and safety, but is it worth the cost to have the newest one?
ReplyDeleteThis is a very interesting and relatable topic for pretty much any modern consumer. There is no doubt that this is a new era for state of the art technology and the iPhone X is taking the forefront of this new era. What would be even more interesting to know is what the total cost to produce each iPhone so that we could see the total net profit of Apple. I am sure there would be some great margins for profit if someone were to point that out.
ReplyDeleteI think it's crazy that this phone has such a high demand. The cost of this phone is crazy and many people won't pay that price for the phone. Apple has made many iPhones through the years and they have a high demand because so many people want/have these phones. With such a high demand for these phones, did the demand for Andriod/Samsungs increase or decrease?
ReplyDeleteI had personally bought the iPhone 7 and, although the X was out, I had no interest in the phone because of the price. Yes, some of the features are pretty cool but not a lot can afford that. It's surprising to me that the 8 and 8 plus had such good deals on black friday, but what surprised me more was the fact that, even though the X was so much more expensive, people still bought that one just because it's the "newest and best thing."
ReplyDeleteTo be honest I kind of wish I would have known about the trade in for the iPhone 8 deal because in my opinion, the iPhone X doesn't seem worth the $1000 out of my pocket. The only thing the X has to offer that the 8 doesn't is the facial recognition and the edge-to-edge screen. Otherwise, the cameras are very similar and they still have the same iOS update. I'd like to see when the price of the X would go down and see how similar the price of the 8 and the X will get. I can imagine the X will inevitably be more expensive than the 8, but probably not by much over the next couple of years. I guess in my opinion, it's not worth it to pay an extra $200 for a little device in your hand to recognize your face.
ReplyDeleteThis is a really good topic to talk about because our generation and society now a days is so materialistic and some of us never think we are until the new iPhone comes out, or that we'd rather spend $50 extra dollars on that sweater because it's adidas. I personally have never seen or looked at the iPhone X but a part of me loves new things and would love to have it. I do not have the chance to risk my opportunity cost because I have so many other things to pay for. I like this topic because a lot of people do have iPhones.
ReplyDeleteAlthough I personally don’t use any Apple products other than their wired earphones, I see the reason why some might pay the $1000 for the new phone. It’s new face recognition causes for an advancement of technology which people will enjoy. With the high demand, and shortage of supply, another plus is found, because then whoever has the iPhone X can be seen as a ‘better customer’ or just of good standing with money due to the costs and how fast the phones went out of stock. iPhones are seen as one of the more expensive phones out there, meaning anyone who owns one of the newer models, is believed to have good money, or at least is having enough money after bills and taxes to pay for such things without much harm.
ReplyDeleteI think that this article is directly related to modern day consumer. Everyone wants the latest and greatest, even if it means sacrificing some few basic needs. This draw for the new Iphone all the time is based off of people to say they have it. Therefore that creates more of a demand for the product because they will be telling their friends, who then will most likely purchase it. Apple is an inelastic company that can afford to make their prices high because people are going to pay what they have to in order to have it. It's all about the name. In the end, the Iphone X is really cool and people should have to pay a decent amount of money because it's incredible technology.
ReplyDeletePersonally I would never pay for a $1000 phone. But it's crazy to think how much the I phone has an impact on the economy. If you look at the cost of when the first ever i phone compared to now. You look at how much the technology in phone has advanced over that period of time. You just have to wonder what phones be like and how much they will cost in 10 years
ReplyDeleteIt's crazy how far Apple has come and how much that has impacted our economy. Although Apple has helped our economy, I feel that the iphone X isn't super necessary. Many people may find the phone better quality and beneficial to their ever day life, but in my opinion I don't see what's so great about the X. People spend way to much money on the new and improved items that are being created.
ReplyDeleteThere was no surprise when reading this post that the new iPhone X had sold out within seconds of its release. Now a days people are more worried about purchasing the new iPhone than paying there bills.The release of the iPhone X diffidently will change the world of phone technology. No one will want and phone that is lower than the iPhone X. New models will shortly come out trying ti imitate and copy all the technology that is featured in the iPhone X.
ReplyDeleteGreat relevant topic, that really sticks out the pros and cons from an economical stand point. I think ultimately that the price of technology has gone up because of the inflation rate. Don't get me wrong, $1000 on a phone is still ludicrous, but don't expect the price to get any lower from this point on. I think that you bring up a valid point when talking about marginal benefit to the public. People with the newest and coolest gadgets out their get a certain praise from others, so buying it could have a marginal effect on people. Over all this was a very well written piece, I like how you used your Economic vocabulary, it really helped me understand the topic better!
ReplyDeleteI think that it is insane, that people would spend $1,000 on a phone, that will be replaced within a year. Each year as new Apple products come out, there is a higher and higher demand, which is great for Apple, but not for our pockets. Like you stated, this is a issue for most of the middle and lower class, because who just has that money to give up. I know that many teenagers are always highly invested into this craze, and are always wanting and proclaiming that they "need" the new apple product. But where will they find an extra thousand just laying around, because most parents won't pay for this. I feel like the thousand being spent could be put to other, better use, like college or other important necessary purchases.
ReplyDeleteI thought that the topic you wrote about was really interesting. Personally I work at Best Buy in the mobile department so I know a good amount about cell phones. What really intrigued me most about the Iphone 10 was that consumers were still happy to buy it at that price point. There was really no new technology going into the iphone ten then there had been on another phone up to that point. For example, the samsung galaxy s8 had everything that the iphone 10 advertised. It had face recognition, an oled display, better processor, and a screen that seemed to go up to the edge of the phone. Not to mention that it was an entire $300 less than what the iphone ten was costing people. Knowing how similar the specs were on the two made me confused as to why someone would spend the extra money just so they could have an apple product. While Apple has good sales with their iphone 8, samsung and other companies such as google are taking advantage of them by having similar specifications and prices that are much less. But think you wrote a very good well thought out piece and did a really good job on the topic.
ReplyDeleteAs soon as the iPhone X dropped, it was a huge hit. I totally agree that demand increased because all people these days are so obsessed with having the latest technology at all times. One thing that I find interesting about the iPhone X is that even though it is a luxury good it is treated as though it is a necessity. I find it mind boggling that people are willing to pay the insane price of $1000 for a phone like its nothing. Its not like it is some insane futuristic phone, it is just the newest version of the iPhone and people trust in the brand and there mission. Overall, this was a great topic to write about due to its relevance and significance. Nice job.
ReplyDeleteI can relate to this because I work at Target and whenever I pass by the electronics section, I always see people either buying or asking loads of questions regarding the newest iPhone. I agree with Thomas, in the general person's eyes, they need to have the newest technology because it's "what everyone has." However, it is confusing to me that the demand is driven so high up, while the price is also driven up so hard. I agree with one of your last quotes, "the iPhone X has caused a great change in the economy.
ReplyDeleteIt is surprising to me how much people want this new phone, especially when it is almost 1000 dollars. The Iphone X is not that much different than the previous Iphone created, but as you mentioned in your post people are crazy about the latest technology. In addition, I agree however that there are other products people can spend their money on instead. Even if people in the lower or middle class save up their money to buy this phone, the may not have enough to buy other necessary products. This was very well written, nice job.
ReplyDeleteIt is interesting to see how much power an oligopolist like Apple has in their brand name. Despite the fact that switching between two phone brands is highly unlikely to make a significant impact to somebody's daily life, many buyers have polarize opinions about which brand is superior. Due to this product differentiation, Apple can charge exorbitant prices as if they were a price-making monopolist.
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