Communications and Technology Industry Research

A new report out this week, based on research performed by firm Compete, indicates that most consumers are unwilling to pay the $500 price tag for Apple’s (News - Alert) iPhone, but would spring for the mobile phone if its price were lowered to $300.

 

Compete performed an online poll in the U.S. about iPhone’s (News - Alert) price, and got 379 responses. Twenty-six percent of respondents indicated that they definitely plan to buy an iPhone when it become available—but only if the price is lowered.

 

Only 1 percent of respondents indicated a willingness to buy the phone for the $500 price set by Apple when it was announced in January.

 

So, if $500 is too much, what’s the sweet spot? Forty percent of respondents indicated that $200-$299 would be about right.

 

The poll indicated that a significant number of consumers are very interested in iPhone; 60 percent said they would switch to AT&T (News - Alert) (parent company of Cingular Wireless, sole service provider for iPhone) just to get their hands on the new phone.

 

Andy Neff, an analyst at Bear Stearns, commented on the poll in a statement: “While the iPhone has been discussed as a competitor to other handsets like Research In Motion’s BlackBerry (News - Alert), the two serve very different markets. Even though there's talk about this as an alternative to RIM, it’s not a corporate product.”

 

In its announcement about the poll, Compete said that Apple’s marketing and selling patterns suggest iPhone’s price tag may drop. Apple has been known to sell products for less than the announced price. For example, Apple TV’s price was announced at $399 but sold for $299.

 

“The phone may start out around $500 because early adopters will pay that,” Neff said. “But pricing will likely drop by $100 to $200 to target the mass market.”

 

iPhone hits U.S. store shelves in June.