For all the talk about premium pricing of Apple’s hardware products, the company is speculated to have been selling two of its gadgets at cost—Apple TV 4K and HomePod.
On the latest episode of The Talk Show, Daring Fireball’s John Gruber claimed that the fifth-generation Apple TV is sold at cost while the HomePod wireless speaker is selling at a loss.
One thing I’ve heard from reliable little birdie is Apple effectively sells Apple TV 4K at cost. Like, they really are like a $180 box.
If true, this suggests that the current Apple TV model costs Apple $180 to make in terms of parts, labor, assembly, marketing, distribution, advertising, licensing and so forth.
The set-top box is priced at $179/$199 for the 32GB/64GB version.
And you think wow this is amazing, it has an A10 processor which we know is super fast, it has crazy good graphics.
I disagree. The “super fast” A10 Fusion powering the set-top box is beginning to show its age, despite “crazy good graphics” (which, too, is debatable).
I think it’s time the Apple TV product line gets an overhaul and I think it’s fairly safe to assume that a refreshed product might be unveiled as part of a press event which we think might take place this spring to announce Apple’s content moves.
I’ve heard the same thing about HomePod too. Why is HomePod so much more expensive than these other speakers you can talk to? HomePod I actually have reason to believe, Apple actually sells it at a loss. I can’t prove it. I don’t think it’s a big loss.
HomePod retails for $349.
Following HomePod’s launch in February 2018, TechInsights pegged the speaker’s bill of material at $216 (such estimates exclude other expenses related to sales, marketing, distribution, advertising, research and development and so forth.
Gruber also speculated that AirPods are sold at cost.
If rumor-mills are right, Apple is prepping smaller, more affordable versions of both Apple TV and HomePod for release some time this year.
Is these gadgets are really sold at cost, or even at a loss as Gruber speculates, could it be because Apple sees them as access points to services like Apple Music and the broader ecosystem, do you think?
Let us know by leaving a comment below.