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So, a lot of high technology. I think we’re advancing the state of the art in every aspect of this design. So iPhone is like having your life in your pocket. It’s the ultimate digital device.
So what should we price it at? Well, what do these things normally cost? An iPod, the most popular iPod, $199 for 4 gig nano. What’s a smart phone cost? Well, they say you get the phone and some of the Internet with it, although that’s questionable. But they cost somewhere around $299. You can get them for $199. Palm just introduced one at $399 yesterday, so they generally average about $299 with a two-year contract. Now, these phones sort of do music but nobody uses them for music because they’re not very good and so they end up buying an iPod to go with the phone. We know, we sell the iPod. And so people spend $499 on this combination. What should we charge for iPhone. Cause iPod has got a lot more than this stuff. It’s got video. Real video. It’s got this beautiful gorgeous wide screen. It’s got multi-touch user interface. It’s got wi-fi. It’s got a real browser. It’s got html e-mail. It’s got coverflow and on and on. And this stuff would normally cost hundreds of dollars. So how much more than $499 should we price iPhone? Well, we thought long and hard about it, because iPhone just does so much stuff. So much better experience on call, on managing your contacts and visual voice mail. Random access voice mail for the first time. Texting and e-mail and real browser and Google Maps.
Tremendous iPod and cover flow and video. What should we price this thing at. Well, for a 4 gigabyte model, we’re going to price it at that same $499. No premium whatsoever. $499. And we’re going to have an 8 gigabyte model for just $599. So we’re going to price it starting at $499.
