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iPhone Average Selling Price Remains Steady Even With Free 3GS Offer

Earlier this week, Apple reported its best quarterly earnings ever, taking in more than $46 billion over three months. 53% of that revenue was from the sale of 37 million iPhones, at an average selling price of nearly $660. This ASP is particularly impressive, considering this is the first quarter that Apple has sold a "free" iPhone in the U.S. -- the iPhone 3GS is available for free to new two-year contract signers on AT&T.


Apple's iPhone ASP has remained fairly consistent, hovering between $622 and $660 for most of the phone's lifespan. With Apple offering their cheapest iPhones yet this quarter, some analysts wondered if that would have a negative effect on the iPhone's ASP. It seems that demand for the 64GB iPhone 4S -- the most expensive iPhone yet at $849 -- has easily offset the cheaper iPhone 3GS and 4 models.


All Things D reports estimates from Consumer Intelligence Research Partners that claim 89% of iPhone purchases in the U.S. were for the iPhone 4S, with only 4% of buyers choosing the iPhone 3GS. More relevant for the discussion above, CIRP estimates that higher-end 4S models sold particularly well, with 21% of 4S purchasers opting for the 64GB model and 34% picking up the 32GB.

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33 months ago

amazing, since pundits initially claimed that the iPhone wouldn't sell at such a high price!

.


Well in all honestly, the original iPhone which was sold @ $499 and $599 did not sell all that well after the initial launch. It was only when Apple dropped the price a couple months after launch that sales started to ramp up. If Apple (Steve Jobs) had been obstinate on price the iPhone may not be the Smartphone leader it is today, but I think Jobs learned that lesson w/ the Cube.
Rating: 7 Votes
33 months ago


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6 year-old daughter, 3 year-old daughter, babygirl 3 to arrive in April 2012. These are my real most valued possessions.


I just wanted to say I loved your signature
Rating: 7 Votes
33 months ago
I think it's great how well the 4S sold, especially since iPhone 4 owners are most likely still in contract. As an Android user, I am pretty impressed with the 4S(Camera, build quality, etc.) Might even consider asking my employer for the 4S. Well done, Apple.

I think the iPhone sells well because it can be recognized as a device similar to the iPod, and it has the Apple brand. While us on here just love the product, people not familiar with Android or Windows Phone turn to Apple because they're well-recognized
Rating: 6 Votes
33 months ago
So bored of hearing about this "free" iPhone offer. The phone is not free - you have to sign up for a long, expensive contract to get it.

Also, the "free" phones are common in Europe. Every new iPhone is available with no up front cost from most of the networks - you can get a 4S for "free" right now in the UK if you want.
Rating: 4 Votes
33 months ago
It's hard to resist buying the 4S even if there is an older version for free available. That may also explain why people would rather buy an iPhone versus another brand (possibly cheaper) smartphone. The iPhone 4S remains the top of the line within and between brands.

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6 year-old daughter, 3 year-old daughter, babygirl 3 to arrive in April 2012. These are my real most valued possessions.
Rating: 4 Votes
33 months ago
amazing, since pundits initially claimed that the iPhone wouldn't sell at such a high price!

.
Rating: 3 Votes
33 months ago

Roughly 60% of iPhone sales are outside the United States of America. Subsidized handsets are not the norm in most international markets.


I really disklike this being called "subsidized". No phone is subsidized or free. You buy a phone with a contract, they give you a huge lone that covers most of the purchase price, and you pay the loan back every month at an enormous interest rate as part of your monthly fees.


Wow, 89% of purchases of iPhones in the US were the iPhone 4S? Just imagine when the iphone 5 comes out


I suppose the percentage will go down a lot, if the iPhone 5 is any good.
Rating: 3 Votes
33 months ago
Consumers apparently favor the latest features over discounts. I'm surprised it's so lopsided toward the iPhone 4s, but perhaps I shouldn't be.
Rating: 3 Votes
33 months ago
I wrote that most international markets do not have subsidized handsets, not all of them.

My statement stands as written.
Rating: 2 Votes
33 months ago

I think a lot of that depends on the buyer. For me, I paid about $1,025 for my unlocked 64GB iPhone 4S with AppleCare+ here in the U.S. Will I do it again, I'm sure I would. With the amount of apps (& growing) that I have, the iPhone is without a doubt the ONLY choice I have when buying a new phone.

I also think that the pricing at first launch with the original iPhone was too high & did not sell well simply because it is a completely "new" product. Most people were so used to a simple phone back in 2007 as people are accustomed to getting a decent cell phone for free on a cell phone contract. IMHO, the initial price then was a shocker. However, nowadays, more & more people get to appreciate the "true value" smartphones bring & with the largest & still growing apps offering that can be found in Apple's app store, I humbly think if pricing for an iPhone starts at $499 (on a contract) today, they will still sell like hotcakes!


Most people buy subsidized. $199 to $399.

Carriers pay full price and subsidize it with the plan.
Rating: 2 Votes

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