Apple: Jobs Retreats

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Even Steve Job makes mistakes. Dropping the price of the iPhone by $200 made so many current customers angry that AAPL is offering rebates to anyone who bought the handset before the cut.

For Apple, it is not a lot of money. Perhaps two million iPhones have been sold already.

It does, however, indicate the problems that Apple may have with several tiers of pricing on its phone and the iPod.

The price cut itself. Still a big mistake. If Apple does sell 10 million iPhone before the end of 2008, $200 per unit is a lot to give up, unless it can improve sales by five or six million units over that time frame.

Douglas A. McIntyre