It wasn’t not a big shock when Apple announced its new iPhone. It is fact that the old generation Apple iPhone wasn’t so fast, it lacked certain features like 3G Internet, Good quality camera, and some small common features which were there in most of the phones of that as well as phones below that range. Apple tried to solve the problem by releasing various firmware updates but still the iPhone popularity began to fall. The main reason behind this was the high price of iPhone. Apple iPhone was priced more then $400 and available for more then RS. 20000 in INDIA. It quite simple that the price was high when compared with the features and perhaps not the value for money.

Now, if was very much expected that Apple will soon release a big update to it’s iPhone and that has happened. Apple’s new iPhone 3G will be available to public on July 11th. There are plenty of improvements and addition (Read my Last Post). But the most shocking news is the price fall. The price of Apple is now just 199$ equivalent to just RS. 10000 approx. Many are looking for the exact reason for the price fall. The price was expected to rise due to many improvements and additions to iPhone but but we saw a big fall. The 8GB version of iPhone for $199 and 16Gb version for $299. I reviews various websites, their reviews, comments and made a conclusion.

The 3G and GPS systems added to iPhone do make it more expensive but may other compnents of iPhonr are going down in value. If GPS and 3g would have been added a year ago it would have been more expensive then ever. Now a days, as the demand for GPS, 3G is increasing so the prices are falling. Many design changes in the iPhone help to reduce it’s cost. Plastic has been used on the body of the iPhone instead of metal. We can not ignore what Apple gets due to the software sales. Apple’s new online iPhone software store will be responsible for huge amounts of sales and revenue. As we know, Apple has an agreement with AT&T that users can use the connection from AT&T also add the value to the iPhone. According to Shiv Bakhshi (Director of Mobility Research for IDC)  Apple will recover it’s won margin for device sales by offering various services via iPhone and connections. This concludes that they are not just making money on hardware it’s like a full ecosystem where Services, Software, etc. are components of revenue.

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