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The Economics of the iPhone

Posted on June 10, 2008

I'll leave the likes of Dan Frommer to do the big-picture corporate economics of the costs and benefits of changing Apple's business model. I'm more interested in the user end: if the price of an iPhone drops by $200, but your phone bill rises by $10 a month, how much of a savings are you really making? Remember that you're tied in to a two-year contract, so over the course of those two years you end up paying an extra $240. Discount that by your own personal discount rate, and it probably ends up pretty much a wash. And what about the Mobile Me service at $99 a year? ( Exchange for the rest o...

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discount rate , economics , mobile