[schnoid]

Customers get to dictate price. They vote with their wallets. And customers are going to be comparing this phone to the other phones at Sprint, and the other "hero" phones at Verizon and AT&T. So Palm and Sprint have to take their pricing into account as well.

agreed! Just look at what happened with the original iphone. That phone was ridiculously priced, and Apple eventually had to take a step back, apologize and give early adopters credit for the price difference. Pricing this thing too high would be a HUGE risk. Sprint would be much better off losing a month or two worth of service fees from their customers to gain millions of new 2 year contracts.

[Beanis]

If they really do force SEP to have the Pre, then Sprint is going to commit suicide with any price over $149.

[captaindan]

It might be 199.00 or less because you will be paying more monthly 60.00 to 70.00 they will make it up that way.

[cardfan]

Wasn't apple charging like 499 (could be more, i forget) on the iphone? It was high. Obviously i don't think palm should do that

[Hoffman109]

Yeah, but what does everyone think that the price will be with a renewal? I get a $175 credit toward a new phone with a 2 year re-up...

[cardfan]

Customers really don't set the price. Customers play a role in demand. There is supply. And there's the point a company wants to set a price and sell a number of phones.

Over the long haul, i expect the price of the Pre to fall in line with the other "hero" phones from the other carriers.

But at launch, demand is at its peak. Sprint expects a shortage for awhile. It will be interesting to see what approach they take.

T3 Hot 100: Top 10

This magazine says the Pre is the hottest gadget on the planet right now. It's hard to tell right now if that will resonate with the public.

[Aero]

Wasn't apple charging like 499 (could be more, i forget) on the iphone? It was high. Obviously i don't think palm should do that

Apple's launch price is irrelevant. that was a million years ago in the consumer electronics business and not on sprint where customers are used to cheap prices. overall market conditions are very different now too.

Apple was on ATT people associate the carrier with higher value. You (and I) can argue against it, but that is a fact of life in the consumer mind.

You also have to consider Sprints needs, they don't need to sell pres they need to sell plans. They need to move people to higher revenue. This isn't about or whether they lose $200 or $150 per Pre at sale, it is about their desperate need to use this to sell higher priced plans.

Now they will get new customers from ATT and Verizon which have less draconian ETF policies and are sued to higher plan prices, but

Pre will go from $250 to $150 subsidized. There are half a dozen factors which Sprint is probably weighing and testing. They are certainly testing ATT iphone owners and their own high ARPU customers they worry about losing, and low ARPU customers they hope to convert to higher plans. I doubt iphone launch price has even come up.

They can satisfy status by having Palm list an high retail price($600) since that is irrelevant to 99% of the people.

Everyone needs to understand how trivial $100 one way or anohter on the actual subsidized price is anyway. You need to divide that price by 24 or multiply plan price increase by 24.

If Sprints average customer is paying $40 and they would be converted to $80, that $40 more x 24 months or $960.

To put it another way the difference for Sprint between $150 and @50 for the initial price is $100 or $4.16 a month on a two year contract.

[jbg7474]

You also have to consider Sprints needs, they don't need to sell pres they need to sell plans. They need to move people to higher revenue. This isn't about or whether they lose $200 or $150 per Pre at sale, it is about their desperate need to use this to sell higher priced plans.

...
They can satisfy status by having Palm list an high retail price($600) since that is irrelevant to 99% of the people.

Everyone needs to understand how trivial $100 one way or anohter on the actual subsidized price is anyway. You need to divide that price by 24 or multiply plan price increase by 24.

If Sprints average customer is paying $40 and they would be converted to $80, that $40 more x 24 months or $960.

To put it another way the difference for Sprint between $150 and @50 for the initial price is $100 or $4.16 a month on a two year contract.

This is great analysis, thanks, aero. When does Sprint have to cough up the full value to Palm? In other words, if Sprint charges me $200 for the phone, and Palm's retail value is $600, when does Sprint have to give up the $400? I know the mail-in rebate will have to be paid shortly. Is the rest paid to Palm over the 24 months, or does it go to Palm immediately? Or is there a different number that Sprint pays Palm (other than the full retail price)?

Seems like these numbers could have some effect on short-term cash flow for both companies. I know Palm has to make a reasonable profit on this phone.

[Aero]

This is great analysis, thanks, aero. When does Sprint have to cough up the full value to Palm? In other words, if Sprint charges me $200 for the phone, and Palm's retail value is $600, when does Sprint have to give up the $400?

On how much, never that much. a hypothetical $500 retail list by Sprint discounted to $200 after rebates and other discoutns might cost Sprint $375- $300 from the maker at wholesale. I have no idea other than that a certainly that the list price isn't near Sprints wholseale cost as this is not a price that has any retail competition. The list price is more or less meaningless highball price.

The handset could also drop in wholesale cost to the carrier over time.

I have no idea on the numbers sprint would pay for Pre. On one hand Palm was hard up, so that may mean a good price for Sprint on the initial guaranteed purchases. Maybe Palms costs will drop and Spint's costs wil rise if Pre takes off.

Also sometimes the maker is the one actually financing rebate to help push stock and sometimes it is the carrier, probably depending on who has the excess inventory on their books.

As far as when they pay, and who puts what on their books when, I am not very knowledgeable on what is customary in that business, or how often non customary deals are made, but it is my general sense that these are contracted between maker and carrier in large lots and are paid for on delivery of each lot, say of 100,000 initially and perhaps 10,000 or 50,000 follow on lots.

It is possible there is a sliding schedule of prices for each chunk committed to by Sprint.

In short I am pretty sure that Sprint pays in bulk when it takes large lot deliveries and that those prices are all contracted with a variable prcing setup.. I am also pretty sure that the cost to sprint is somewhere in the mid range between list price and discounted price.

[cardfan]

They both are kind of cash strapped and the demand will be off the charts at first and so it remains to be seen if that factors.

All i do know is it'll probably be in the 169-249 subsidized range and really just isn't an issue with me.

[Se7enth]

Assuming that the Pre will be priced close to the Treo Pro, I would say this isn't that bad. =)

http://img237.imageshack.us/img237/5...eoproprice.png

[ImmaSlave4U]

I wonder why they still won't release pricing information. You'd think they would have figured out what they're going to sell it for, right?

[cardfan]

They need to how much stock they got ramped up is my guess..

[Aero]

I wonder why they still won't release pricing information. You'd think they would have figured out what they're going to sell it for, right?

Even if they had, why would they, it just gives their competition an advantage.

I don't think they have a settled price anyway. they may have a price picked if all things remain the same, but want the latitude to move it up or down at the last minute in response to market conditions.

It does them no good to give a price now and has several disadvantages.

[cardfan]

Apr-jun release with a price range of 179-299. Pretty wild people are going nuts for specifics though.

I'm still much more interested in features, apps, etc.

[ImmaSlave4U]

Apr-jun release with a price range of 179-299. Pretty wild people are going nuts for specifics though.
I'm still much more interested in features, apps, etc.

For me, it's about being a non-rich college student. It'd be nice to know in advance how much it's going to set me back. I probably won't buy the Pre if it's over $249.99 and would hate to waste my anticipation for it if it's going to be priced higher than that.

[Agibbs996]

They could lower the price on the Pro when the Pre is released in a few months.

[jbg7474]

They could lower the price on the Pro when the Pre is released in a few months.

This is a good point, especially if the Pre doesn't come until June.

[Aero]

They could lower the price on the Pro when the Pre is released in a few months.

I don't think so. Why would they need or want to?