[sheepscreek]

The message I’m getting is that Apple will never compromise on its healthy margins. If something becomes basically unaffordable for their target market, they’d cut the production and even discontinue the product, than take a hit on margins. Their business model is refreshingly simple.

[khurs]

That works only if the product is the product.

Iphones/tablets drive app sales/apple subscription services, if they force a user to move to android they may never return.

Why do you think they sell the iPhone 17e/se? They need to maximise their user base as its ongoing recurring income stream.

[sheepscreek]

Yes - they create new/cheaper products for a different consumer but not at the cost of their margins. Vision Pro may have been the only device in recent history that likely had slim margins (if any).

[freehorse]

Apple is not gonna risk their iphones, as they are their flagship (aside even from giving them higher margins). My opinion is that, as we are talking about ram SHORTAGE (not just for ram price hike) they have to cut the more ram hungry models to be able to keep up with their projected production/demand (at reasonable ram prices). Getting iphones "sold out" is not a great thing for apple.

Once/if the ram shortage ends, they will continue increasing the ram caps as they were already doing, because then selling ram-heavy macs will not interfere with the rest of their products.

[jltsiren]

It's just a planned economy failing the way planned economies often do: the central planner failed to predict the demand correctly. Instead of trying to secure additional stock from the market at spot prices, they are simply waiting for the next batches they had planned for.

[Grombobulous]

I don’t think that represents the scenario at all, not to mention the fact that it’s literally not a planned economy (but also not very analogous to one, either).

What’s really happening is that the effort of securing additional stock isn’t worth it because the price is so high that there aren’t enough buyers.

If ground beef were to suddenly cost $50/pound, McDonald’s doesn’t raise the price of the Big Mac to $25 and hope people buy it, because it makes zero sense for their business model. Sure, some fancy restaurant will still be selling hamburgers, but not your chain of thousands of working class fast food restaurants. McDonald’s would find some other alternative item to sell.

The truth is that nobody’s going to be buying Mac Studios that cost $25,000. Not even enterprises.

[jltsiren]

Businesses are usually planned economies, and supply chain management is literal central planning.

Apple failed to predict the demand for Mac Studios. Many other companies in its supply chain likely failed to predict that Apple would come back asking for more. There is no excess stock for some key components or the spare capacity to make them on demand. Apple would have to scour them from the market, likely paying much higher prices than it will pay for scheduled deliveries.

[Grombobulous]

Hopefully I’m not being too pedantic, but I am saying that we can’t just use the words “planned economy” or “central planning” to describe a single company’s actions.

It’s just not what those words mean.

Apple is a large company but they are still just one company.

A single business can’t be doing “central planning,” it is by definition not in charge of the whole market.

Central planning would be if the government mandated that Micron to make ## of memory chips and distribute ## of them to Company A and ## of them to Company B.

Apple has no such power.

https://en.wikipedia.org/wiki/Planned_economy

[surgical_fire]

I actually think Apple is right in increasing prices, and in fact should have increased it more.

Their target market is composed of people that would pay for it nonetheless. They should have tightened the screws a bit more.