Apple CEO Steve Jobs has been quoted as saying: “We don’t know how to build a sub-$500 computer that is not a piece of junk.” Job’s disdain for the under $500 price point for personal computers reflects his belief that price should not be the driver of product developments. Through much of its history, Apple has pursued a premium pricing strategy to complement its reputation for offering more innovative and superior products. So, even if Apple resellers were to clamor for Apple to offer lower-priced computers (as well as other products) to compete at price points that Apple is missing, Apple is likely to say no. Discuss Apple’s pricing strategy in terms of its future implications for the company’s channel strategy.
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