$35 phones for Microsoft, $670 for Apple

[luxnws]

Apple reported average selling price of its iPhones last quarter was $670 each.

Microsoft didn't release ASP when it released last quarter results but a rough calculation based on the numbers in their report is $35. That includes Lumia and non-Lumia phones.

Any guesses how much the Lumia 950 and 950 XL launch will affect Microsoft's phone ASP for this quarter? After consulting with the dartboard, I'm guessing +$10-$15 in U.S. dollars so ASP should be $45-$50.

 

[HoosierDaddy]

Apple reported average selling price of its iPhones last quarter was $670 each.

Microsoft didn't release ASP when it released last quarter results but a rough calculation based on the numbers in their report is $35. That includes Lumia and non-Lumia phones.

Any guesses how much the Lumia 950 and 950 XL launch will affect Microsoft's phone ASP for this quarter? After consulting with the dartboard, I'm guessing +$10-$15 in U.S. dollars so ASP should be $45-$50.

Average selling price by itself means almost nothing. The cheapest POS car costs orders of magnitude more than a iPhone. And a Big Mac costs orders of magnitude less than an iPhone but Micky D's was doing great for years until people wanted to live longer. So until WPs start causing more cancer than iPhones, I'm not going to lose sleep over ASP. Now average disposable income per buyer means a lot because WPs needs the apps and monitization is what drives that. Clearly iPhone users on average spend more than the average WP user and that is their advantage. If Wp buyers were more affluent, having a lower ASP would be a huge ADVANTAGE for WP. So MS' course is clear: just give all WP customers a million dollars so they can buy more apps/services/in-app purchases than iPhone owners.

 

[luxnws]

Average selling price by itself means almost nothing. The cheapest POS car costs orders of magnitude more than a iPhone. And a Big Mac costs orders of magnitude less than an iPhone but Micky D's was doing great for years until people wanted to live longer. So until WPs start causing more cancer than iPhones, I'm not going to lose sleep over ASP. Now average disposable income per buyer means a lot because WPs needs the apps and monitization is what drives that. Clearly iPhone users on average spend more than the average WP user and that is their advantage. If Wp buyers were more affluent, having a lower ASP would be a huge ADVANTAGE for WP. So MS' course is clear: just give all WP customers a million dollars so they can buy more apps/services/in-app purchases than iPhone owners.

Really?

ASP shows the market power of Apple compared to the rest of the competition. It indicates that Apple can sell $700 phones in such volume where other phone manufacturers struggle to sell phones at less than one-tenth that price.

Trend in ASP along with other measures also reflects on profits. Without healthy profits, a company can't provide as much support to customers or developers.

Apple made $11 billion in profits in three months. Three months. Think about that. Even if they put 10% of those profits back into their software development r&d and support, that would be more than the total sales of Windows Phones over the same three months.

 

[Gunbust3r]

This is a key problem for Microsoft. How do you present value to a customer going from a $35 phone to a $700 device? They are phones after all, it's pretty much inevitable that the thing is going in a toilet, puddle, spiked onto concrete, left on a car roof, lost at the bar.

Thanks to the Apple reality distortion field Apple people don't bat an eye at being out $1000 after the insurance and deductible for damage that they could have done to a $35 handset instead.

 

[DCProjMgr]

... ASP shows the market power of Apple compared to the rest of the competition. It indicates that Apple can sell $700 phones in such volume where other phone manufacturers struggle to sell phones at less than one-tenth that price.

Trend in ASP along with other measures also reflects on profits.

OK, I'm sorry but an ASP number shows no such thing. It says nothing about profit, nor does it indicate that a vendor is "struggling". You are going to have to bring in a lot more statistics if you want to talk profitability or the amount of effort it takes to reach that number.

I sold my Nokia 830 last month for $230. So I have a higher ASP on my (1) phone sale than Microsoft. Does that indicate that I am more profitable than Microsoft and not "struggling" to sell phones?

 

[luxnws]

OK, I'm sorry but an ASP number shows no such thing. It says nothing about profit, nor does it indicate that a vendor is "struggling". You are going to have to bring in a lot more statistics if you want to talk profitability or the amount of effort it takes to reach that number.

I sold my Nokia 830 last month for $230. So I have a higher ASP on my (1) phone sale than Microsoft. Does that indicate that I am more profitable than Microsoft and not "struggling" to sell phones?

On onesy and twosy sales, sure ASP is meaningless.

On more than 70 million units sold, ASP sure isn't meaningless.