Hey zac, given your speculative and unsubstantiated article, I would say you don't know much about this company now do you. As far as media is concerned, most of you have been wrong about Apple as far as an eye can see, so continue your BS while I continue to generate ridiculous returns taking advantage of every single FUD article you can generate.

Take care now

As an AAPL shareholder, I'm excited by the price cut because it is *not* a short-term strategy designed to beat quarterly expectations but rather a *long term* strategy of market penetration -- even at the expense of short and/or long-term margins.

Apple wants to capture market share -- even at a great cost -- because the Halo Effect (iPhones, iPods, Macs, AppleTV, iTunes, etc.) is very real.

I'm proud of the corporate governance and leadership at Apple and I'm very glad they're going for long-term global growth instead of worrying about margins in the near term.

I Don't think Apple needs to play games to make there numbers - This is another idiotic article - if anything they undercut the expectations. Its a brillent move - they make more money on the contracts than the upfront phone - just ask verizon!!

If they were simply making decisions to beat the number why would they recognize the revenue stream over such an extended period? Jobs & Co. could draw and quarter the "number" if they booked it in a more accelerated manner. What happened recently Bud Fox? Oh yes, they passed the Imillion mark in sales. Now let's use our brains. Why the price cut? Obviously the sales mark and the price cut are in some way related don't cha think? Basically, if you listened to the last conference call they offered no outlandish predictions and/or tepid guidance. (Imagine if they had predicted 1 million Iphones in two months? I'd be on Necker with Sir Richard Branson) Why? Because it is impossible to predict consumer behavior. Is this bad or misleading? Well, not bad but the company does have a history of beating their number (something like 18 straight quarters) or something of that nature. Why don't folks focus on how Apple completely hoodwinked the investment community by building computers that are better then their competitors and diliberately misleading the analysts into not hyping the product thereby tricking the entire industry and causing them to look the other way while Apple increase market share. Get my point? (The last bit was a joke.) No confusion, price drops in regard to tech toys is the norm. If the phone were at say 450K the song and the price would remain the same. Anyway, this puts them on pace to sell about 6 million phones this year. The holiday season will be a monster and if this thing really takes off they could even sell more. What's the margin on the phone? I don't know do you.

I find it interesting to write about Apple because the hype surrounding the hype clearly illustrates the inability of those that say they know clearly don't know and, moreover, they cannot analyze a situation that is fluid. It is like grand rounds for brokers and investment junkies. The zebra in the pack of horses. The tiger hiding on the savannah. Anyone can man the bridge in the calm seas. The ability to recognize a white swan is sometimes more important to recognize the black swan. WIll Apple slow down? Someday. Someday north of $200.

Beltway Greg
Time to go change into my black t and levis.

Zac, Thats a bad stuff u started smoking these days....get rid of it.

Steve Jobs is certainly the Master at marketing products to morons with money. Really now, a $599 cell phone that you can't use in Europe (w/o a home equity loan). I'm really shocked he was able to move 1M of these things (at those prices). The real issues will be how long the batteries last and about their decision to make them as sealed units. Most can live w/o an IPod but few w/o their cell phone (when it's in the shop for a new battery).
Have traded the stock (not in it now) and generally dislike the prices of their products (there's better & much cheaper alternatives).

"The article then goes on to ask whether the price-cut makes any sense, other than as a way of beating expectations."

The above comment does NOT make any sense!

Apple keeps a daily total of its cumulative iPhone sales. It knew from the rate of sales approximately when the 1 millionth iPhone would be imminently sold. Even if it took 80 days, instead of 74 days, to reach its goal, it would still OVER-DELIVER on the 1 million over the remaining 10 to 16 days of the quarter. Apple's 1 million goal, was WAAAAAAAAY above what analysts thought Apple could do on a product without a FIXED keyboard, that was vilified by the analysts BEFORE it was introduced.

Apple set a very high goal, higher than any other cell phone introduced before the iPhone, and reached that goal. It then implemented pricing to reach its next goal: increase MARKET SHARE. Apple didn't have to prove anything by keeping the original higher price, just to see how many it could sell over the first 90 days at the higher price.

Apple took advantage of the media focused on the new iPod announcement and got millions of dollars of free publicity AROUND THE WORLD.

That's what makes Apple a great software, hardware, AND marketing company.

Apple beat its quarterly numbers, and, then, RAISED THE BAR!

Zac,

Just when I thought you've given up on being wrong time after time in your pronouncements of Apple's ability to get traction in the marketplace, you come out with another blog post, being wrong again.

Way to go, keep posting, your take on Apple news is always thought provoking even though it's probably wrong. But there's always tomorrow and the chance to luck upon a correct assessment of events in an industry you're not in or know anything about.