Is a spinoff of iPhone coming soon?

As all rumors indicate, there will be two iPhones coming out this fall, one fancy for high-end users, one cheap for teenagers, and most Chinese.

Coincidentally, I watched a rerun of Shark Tank a few days ago, and one person was rejected pretty much because she wants to expand to low-end market while Sharks think she should stay high-end. Sharks made a lot of sense. If you are profiting beautifully from high-end market, why shrink your profit margin to go for low-end? Think LV, Hermes, PRADA etc etc (I have been shopping with my girl way too much...)

However, intuitively, it always seems to be a good idea to extend your market to the widest audience. The average profit margin may be low, but the total amount of profit is surely up.

The problem is that making your product available to general public would hurt your high end market, since people wouldn't pay as much for luxury if the same luxury name can be acquired with a much lower price (I don't think people who buy luxury care about the quality difference between 2-year lifespan and 5-year lifespan. I don't even think they can keep those stuff that long). People are competitive, but people don't want to brag and look like b&$%#. Therefore, people want their "better" stuff to be noticed in the most obvious way, brand name. Whether a product is made of the best cloth material on earth or just cotton, as long as it is not obvious to general public, i.e. friends, it is not worth the extra 200% money spent.

People in car industry had the right idea, spin-offs. Everybody feels it is worth the money to spend much more than they should for a Luxus / Lincoln / Acura / Cadillac, but not for a Toyota / Ford / Honda / Chevrolet. As a result, everyone is happy. Rich people distinguished themselves by spending tons more for a different logo, rich people's average Joe friends settled with good quality bargains, and the company squeezed every last penny from everyone.

Other industries have similar things as well, MiuMiu and PRADA, Marc and Marc Jacobs, dENiZEN and Levi's (Levi's IS high-end in China), etc etc (again, been shopping with my girl too much).

When I watched that Shark Tank, I was wondering why nobody proposed the idea of dividing the company. It might be because Sharks only focus on make small businesses take off rather than consider long-term strategies, or it might be because Sharks won't say that to a person who is obviously not interested in others' opinion.

In the case of Apple, however, I believe it is very possible that either 1) all high-end iPhones in the future are going to look radically different from low-end ones, or 2) there will be a name spin-off for all entry-level iPhones, so Apple can perform the old trick of price discrimination to maximize total profit. Apple is big enough to go after markets with smaller profit margins, and Apple is famous enough as well.

I don't think the price of a phone will go up by much, since people have a certain budget for things they are very certain will be changed in two years (people change purses more frequent than that, but a purse *looks like* can be used forever). However, the cost of producing a phone will be reduced while the price won't. Hence, the entry-level iPhones can go ahead and compete in the price war, while the high-end ones stay on top.

Maybe I should start a rumor about Apple like everyone else... mmm...

iPad, the new Louis Vuitton

This title sounds a little odd, doesn't it? Well, this idea suddenly hit me while I was driving home the other day. I was impatiently waiting for an update on my Chromebook order from Amazon, and thinking about all the terrible things that can happen to this order.

One thing that occurred to me was they would ask me whether a white one would be good (I ordered the black Titan Silver one), if I want it now rather than a month later. I felt grossed out by this idea alone, a white Chromebook? Ewww... I would never want that, and I would rather not use a Chromebook at all.

Wait a second, aren't they both Chromebooks? Same specs, same OS, and the only difference is the color? I would rather have none than the white one? And I call myself a practical person?

I suddenly realize why I want Chromebook at the first place. Sure, the whole living on the cloud thing is cool and all. I got one despite of all those security concerns because I want to be seen with it! I like the idea of trying out new stuff that I think is the future (without "too much" sacrifice to my personal security and privacy).

Then I realize why there are so many tablets out there that have so much more to offer than an iPad (more free apps, better hardwares, comparable OS, comparable types of apps, to name a few), but nobody is even close to catching up iPad, not even the sum of them. In fact, 97% of the tablet web traffic came from the iPad, and web browsing is actually more complete on Android devices, since the whole Adobe Flash thing.

People want to be seen with an iPad, not just a tablet, THE iPad.

When you have an iPad, it is not about what it can do, or not even what you can do with it. It is about the willingness of taking it out from your backpack during that 30 mins layover in Atlanta.

It is like Louis Vuitton. It may provide the same (or less) set of features or functionality or beauty as competitors, but people want to be seen with LV rather than some ... well, bag (btw, for once, the Chinese beat-up version actually came out first, in fact, decades earlier than the luxury).

Some may say they are completely different, because LV is a luxurious brand of handbags, while iPad is some technologically advanced, yet affordable device. They cost different, they are in different categories, and they will surely have different future.

Well, if you think carefully, both products probably have the same lifespan in your household (a new one every two three years), and their eventual costs are probably similar (don't forget about all those songs and apps you spent money on because of this magical device). As many of you may already know, it is almost impossible to buy a finite set of apps and be good with them. There are always new games, new productivity tools, and new fads (farts, vuvuzela, colorful flashlights), let alone all the endless possibilities brought by future advance in hardware. Therefore, even if you can transfer all apps from old iPad to new iPad, you will still buy apps at a very similar rate. There is no doubt about it.

LV is also not going out anytime soon either. As long as it keeps being selective, (and of course, not making absolutely terrible ideas too often), it will still be every girl's dream, and as a result, guys will pay anything for it, even if those bags are sometimes not really within some guys' financial means.

All in all, iPad is the Louis Vuitton for guys, and the second Louis Vuitton for girls. Android devices, you already one-upped iPad in technology, now step your cool game up! Otherwise, you will always be the right choice, which will only be made by geeks. You know, there aren't so many of us.