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Apple’s founder1 and CEO Steve Jobs's making a stunning2 reversal and apology tonight on that iPhone that was the talk of Tech-land. CNBC's Silicon4 Valley Bureau Chief Jim Goldman is live in San Jose. Hey, Jim?
Yeah, you know. call it iPhone fury with a major drama playing out today, angry iPhone users who paid full price for the device just two short months ago. And they feel gouged5 by a steep cut price cut announced yesterday. They peppered Steve Jobs himself with hundreds of emails and their furious voices were apparently6 heard, loud and clear.
And this is what the product looks like. In the midst of all the iPod hoopla, from the Apple event on Wednesday, Steve Jobs drops an iPhone bombshell. We are gonna price the 8 gigabyte model of the iPhone at just 399 dollars. A big price cut shocking hundreds of thousands of iPhone customers and not in a good way, many of whom waited hours even days to buy one for 200$ more just a couple of months ago. A 200-dollar price cut? What do you mean? They cut the price just then by 200 dollars. What?
But just a day later after hundreds of angry emails to Steve Jobs himself, thousands more on blogs all over the internet and a torrent8 of bad blood, Apple has yet another surprise.
Apple issues an apology along with a 100-dollar rebate9 to all iPhone customers along with a personal note from Steve Jobs quote: We wanna do the right thing for our valued iPhone customers. We apologize for disappointing some of you and, we are doing our best to live up to your high expectations of Apple.
I think it’s good because those things are too expensive, anyway.
With so much resentment10 toward a company where image is everything.
One of the 7 Wonders of the world.
Steve Jobs’s trying to answer the call trying to do right by its customers.
Now Apple’s quick response to the online iPhone fury is impressive. The question now for consumers and investors11 will be is it just too little, too late. Piper Jeffrey estimates the rebate will cost the company about 85 million dollars. Melissa back to you.
Oh, yeah, Wall Street is gonna love that. Jim stay with us, let's bring in our other Apple insiders, CNET editor at large Brian Cooley. Brian, does this mean to you that they priced it wrong in the first place?
They either priced it wrong or they overreached on the sales pays. Melissa, I’m not sure what to think about this, there is no way there was 200 dollars of margin12 in the iPhone, so they didn’t just decide to give back their profit in this, in the name of volume. That just doesn’t make sense. So are they taking a bath here because they priced it wrong and sales haven’t been as fast as expected. I don’t know, it’s possible. This's a stunning price cut. And the fact that Steve Jobs comes along is, with a mea culpa to go with it proved that yeah, this wasn’t some preordained plan, this was at loops.
Yeah, Jim, what about that? I mean it sounds like this was a mistake in pricing.
You know, I don’t necessarily agree with that, first of all , the margins13 on the iPhone if you believe all the third market research are spectacular. So I think there is some serious room to negotiate the price and still leave Apple with a pretty serious profit at the end of the day. As far as a mistake in pricing, you know, Apple could write its own ticket when this thing started and by stepping up today, I don’t necessarily think this is a big hoop7, I think
But Jim, I mean…
This is Apple realising that there was a problem and they stepped up and said ”Hey, you know what, we are gonna do what we can to do right by our customers. You don’t have to do anything, but we are gonna try to do something, and there wasn't like weeks of hand wringing14,wait wait wait.... ”
Are you sure they don't have to do anything, I mean it's only been two months they lowered the price 33% now they are doing a rebate the day later, I mean it sounds like you have a mistake.
No,no,no, this is the technology industry, I will grant you that the price cut happen a lot sooner than most people thought it was going to happen. But the fact is that prices fall and performance increases, this is Moore's law. You know, that's, That’s what happens with new gismos and gadgets15. The interesting thing here is that there wasn’t a bunch of hand wringing that lasted weeks and weeks and Focus group, and let’s meet with Wall Street to figure out what they are gonna say. You know what , Steve Jobs woke up , read some emails and said hey, you know what, enough is enough, let’s do something about it.
Brian, what happens from here?
But, there is something, there is something odd about the pacing here. Two months and the product did not rev3, Apple has never cut the price on a product that I can recall without revving16 it. This is a case of just saying, you know what, the existing product on the shelves, still new, something is wrong with the model, this is an unusual adjustment for Apple.
Time will tell, all right, gentlemen, Thanks so much for joining us tonight.
Thanks a lot.
Notes:
Handwringing: An excessive expression of distress
Hoopla: Boisterous, jovial commotion or excitement
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1
Founder
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| n.创始者，缔造者 | |
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2
stunning
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| adj.极好的；使人晕倒的 | |
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3
rev
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| v.发动机旋转，加快速度 | |
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4
silicon
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| n.硅(旧名矽) | |
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5
gouged
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| v.凿( gouge的过去式和过去分词 )；乱要价；（在…中）抠出…；挖出… | |
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6
apparently
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| adv.显然地；表面上，似乎 | |
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hoop
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| n.（篮球）篮圈，篮 | |
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torrent
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| n.激流，洪流；爆发，(话语等的)连发 | |
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9
rebate
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| v./n.折扣，回扣，退款；vt.给...回扣，给...打折扣 | |
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10
resentment
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| n.怨愤，忿恨 | |
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11
investors
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| n.投资者，出资者( investor的名词复数 ) | |
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12
margin
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| n.页边空白；差额；余地，余裕；边，边缘 | |
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13
margins
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| 边( margin的名词复数 )； 利润； 页边空白； 差数 | |
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14
wringing
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| 淋湿的，湿透的 | |
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15
gadgets
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| n.小机械，小器具（ gadget的名词复数 ） | |
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16
revving
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| v.（使）加速( rev的现在分词 )；（数量、活动等）激增；（使发动机）快速旋转；（使）活跃起来 | |
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