1. Why did Apple reduce the price of the iPhone so soon? Was it a smart move?
2. Give examples of other recent high-tech products that have come down in price over a relatively short period of time.
Most high-tech products are introduced at a high price, and consumers know that the price will come down eventually. However, Apple slashed $200 off the price of its 8GB iPhone to $399 just two months after introducing the product in 2007. Apple’s CEO Steve Jobs apologized to customers and said “this is life in the technology lane.” To pacify customers who purchased the $599 iPhone, Apple gave them $100 in Apple store credit. Just one year later, the new iPhone 3G, priced at $199, was launched and was touted as twice as much for half the price.