In general, analysts were expecting a $400 iPhone 5C. But Apple announced one starting at $549 — not a budget or low-cost phone by any measure. Apple’s stock price dropped about 5% and stayed there. Overemphasizing the wrong information — whether or not Apple would compete in the budget smartphone category — speaks volumes about Wall Street’s myopic, misguided and clueless understanding of consumer electronics and Apple’s role in it.
- Wall Street over-values measurable data
- Wall Street can’t think long-term
- Wall Street doesn’t appreciate irrational decision making around price
- Wall Street doesn’t understand the power of Apple’s decommoditization branding strategy
- Wall Street doesn’t understand Apple’s breathtaking plan to own identity, mobile wallets, eCommerce and more
Apparently, Wall Street also doesn’t understand how Apple can produce the iPhone 5C which sells for less than iPhone 5 but probably has a larger gross margin which means the price can be discounted more readily.