Essential Phone slashed $200 USD

[S w a t s o n]

https://www.theverge.com/2017/10/22/16516828/essential-phone-price-cut-499-android
 

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Essential is slashing the price of its eponymous phone, down to $499 at its website. That’s a $200 price cut from the original $699 price, less than two months after it began shipping to customers. There is really no other way to read the move except as a signal that it wasn’t selling well at $699 — especially given that the only US carrier stores it’s available in have “Sprint” above the door.

I've been eyeing the essential phone or it's successor as my next phone after my OP3T dies or I upgrade. So I'm actually ok with this, especially if it means the company lives on to another release cycle. However one wonders what made them think they could charge the original flagship pricing. Titianium is nice but still. Clearly they had this $200 as margin, I bet if they paid Samsung for their OLEDs, the reviews would have been more positive and possibly could have led to the phone moving at the original price. Though really they needed to have the camera down pat, they fucked that up. Edit: Waterproofing too, at this price point it's mandatory.

 

Quote

To help salve the burn that customers who paid the full price might be feeling, the company is offering a $200 Essential Store “friends & family code” to be used towards the purchase of another phone or a module. The only module available thus far, of course, is the 360 camera.

Yea, people aren't happy about this, unless they got it for $0 on a contract. They probably should have just eaten the cost, unless it would have literally bankrupted them. At least they are offering the full value I guess....

[mynameisjuan]

As much as people hate this phone, at $500 its actually not a bad price for what you get

[michaelocarroll007]

16 minutes ago, Swatson said:

https://www.theverge.com/2017/10/22/16516828/essential-phone-price-cut-499-android
 

I've been eyeing the essential phone or it's successor as my next phone after my OP3T dies or I upgrade. So I'm actually ok with this, especially if it means the company lives on to another release cycle. However one wonders what made them think they could charge the original flagship pricing. Titianium is nice but still. Clearly they had this $200 as margin, I bet if they paid Samsung for their OLEDs, the reviews would have been more positive and possibly could have led to the phone moving at the original price. Though really they needed to have the camera down pat, they fucked that up.

 

Yea, people aren't happy about this, unless they got it for $0 on a contract. They probably should have just eaten the cost, unless it would have literally bankrupted them. At least they are offering the full value I guess....

Just because they lowerred the price doesnt mean they had or have $200 profit they can eat.  $499 though seems like a good option for anyone not trying to spend 750 on a S8 or 800 on a lg V30

 

I did think $699 was a bit much but only because it was lacking camera & waterproofing to compete with the normal flagships.  Otherwise i mean Its price is cheaper then the S8 and other similar phones i dont see anything wrong with it then. I personally find all phones at $800+ over priced but thats my own opinion. In terms of competition its pricing if it had these crossed off would be decent.

 

 

Thinking about it on all fronts the S8 has been at 575 a bunch of times not long after launch but were "sales" and unlocked only from places like bestbuy. But carriers havent dropped it much if at all. It seems like they are just not offically lowering it so some people pay the extra money who dont know anybetter or only want payment plans 

 

[S w a t s o n]

5 minutes ago, michaelocarroll007 said:

Just because they lowerred the price doesnt mean they had or have $200 profit they can eat.  $499 though seems like a good option for anyone not trying to spend 750 on a S8 or 800 on a lg V30

They almost certainly did, they wouldn't sell at a loss. This isn't a console, they wont try to make money off the attachments only. Also we know average BOM costs for high end phones. they had AT LEAST $200.

[seon123]

Isn't that roughly the price of the OP5? This seems like an amazing deal in comparison. Unless I'm missing something, that is. 

[S w a t s o n]

Just now, seon123 said:

Isn't that roughly the price of the OP5? This seems like an amazing deal in comparison. Unless I'm missing something, that is. 

Yup

[michaelocarroll007]

29 minutes ago, Swatson said:

They almost certainly did, they wouldn't sell at a loss. This isn't a console, they wont try to make money off the attachments only. Also we know average BOM costs for high end phones. they had AT LEAST $200.

Many Companies have sold products at a loss to move them off the shevles after pretty much a failure. Happens every single day. Knowing a straight up BOM costs really is no where near the full picture to the Full Cost when they Look at Actual profit at year end. Overhead exists and when not selling a lot of phones it only becomes a bigger % of it. This is where apple in the past has shined. they only make 2 (now 3 ) phones a year so overhead Per unit sold is not high since they sell so many units. 

 

HTC phones in the past few years have all failed and been much cheaper a few months after launch its not because they made too much money there going under.

[Crossbred]

1 hour ago, Swatson said:

They almost certainly did, they wouldn't sell at a loss. This isn't a console, they wont try to make money off the attachments only. Also we know average BOM costs for high end phones. they had AT LEAST $200.

Not really. Assuming that most phones have already been produced, selling at a loss is always better than holding useless, expensive merchandise. 

Also, the breaking-even point in economics includes expenses for the entrepreneur/ceo/whoever to be paid, so he/she could take a hit to their personal profit in order to squeeze out more sales. So even if they lowered the price below breaking even, they would still sell them or even continue producing a small number.

[dizmo]

I don't think the phones failure has anything to do with its display, but the poor camera performance, delay of launch, and absolutely horrid marketing strategy. You can't bank on the fact that you're a founder of Android as a reason people will buy your device. 

 

$499 is a superb price for what the device really is. If they continue to issue updates for the camera, they could have a really nice device. I hope they manage to carry on through a other year and come out with another device, one where they've learned from their initial short comings. A stronger camera, waterproofing, perhaps going with aluminium or stainless steel instead of titanium, and a lower initial price would make for a killer device offering. Then throw in proper marketing and you'd have a better chance of winning. 

 

As for those who already purchased the phone. Well. That's just what happens when you're an early adopter. 

[PlayStation 2]

Again, couldn't pay me to take it.

[handymanshandle]

I'm perfectly happy with my Galaxy S8+. :^)

[GoodBytes]

Looks like the phone isn't selling well, and so the price was dropped quickly.

[AlTech]

10 minutes ago, GoodBytes said:

Looks like the phone isn't selling well, and so the price was dropped quickly.

I only watched 1 review of the phone and the review wasn't kind to say the least.

 

It totally bashed the abominable camera.

[suicidalfranco]

i hate OnePlus ever since the shitty way they trated they're One and Two users, but would still buy reverse-jello-screen 5 or wait the 5T over picking this up

[S w a t s o n]

1 hour ago, suicidalfranco said:

i hate OnePlus ever since the shitty way they trated they're One and Two users, but would still buy reverse-jello-screen 5 or wait the 5T over picking this up

you crazy

 

3 hours ago, michaelocarroll007 said:

Many Companies have sold products at a loss to move them off the shevles after pretty much a failure. Happens every single day. Knowing a straight up BOM costs really is no where near the full picture to the Full Cost when they Look at Actual profit at year end.

 

I said margin not profit. They had margin on this phone.

 

2 hours ago, Crossbred said:

Not really. Assuming that most phones have already been produced, selling at a loss is always better than holding useless, expensive merchandise. 

Also, the breaking-even point in economics includes expenses for the entrepreneur/ceo/whoever to be paid, so he/she could take a hit to their personal profit in order to squeeze out more sales. So even if they lowered the price below breaking even, they would still sell them or even continue producing a small number.

 

I understand how and why it happens but it's not happening in this case, it does not cost more than $499 to make the essential phone. "Taking a loss" on the sale of the product does not include company expenses. As long as they break even or make any money at all per sale of a phone they are not losing on each sale.

[suicidalfranco]

Just now, Swatson said:

you crazy

no, this phone is just as bad as the Pixel if not worse... nah, i take that back, nothing is worse than the Pixels

[Septimus]

4 hours ago, mynameisjuan said:

As much as people hate this phone, at $500 its actually not a bad price for what you get

I've been looking for a new phone, but nothing that has come out recently has really caught my attention besides the S8, which is quite expensive. What do you think of the Essential Phone proved at $500 compared to the upcoming OnePlus 5T, assuming it turns out well? 

[Kobathor]

3 hours ago, dizmo said:

I don't think the phones failure has anything to do with its display, but the poor camera performance, delay of launch, and absolutely horrid marketing strategy. You can't bank on the fact that you're a founder of Android as a reason people will buy your device. 

 

Absolutely. I thought it was some weird knock-off phone until it launched, since the only marketing I ever saw was weird promoted Twitter polls. When I saw the $700 price tag I marked it off my shortlist.

[mrchow19910319]

No phone company can do their camera right within a few years of time. 

 

It takes years and years of research and implementation to do it right, like apple and samsung do.

[dizmo]

29 minutes ago, Kobathor said:

Absolutely. I thought it was some weird knock-off phone until it launched, since the only marketing I ever saw was weird promoted Twitter polls. When I saw the $700 price tag I marked it off my shortlist.

Haha yeah. Even I didn't hear much about it and I'm pretty into the mobile scene. They also made the horrible choice of pairing with Sprint and only Sprint. I mean, gorgeous build, but the camera issues just soured the deal.

 

I'd love to see what they could do with a larger form factor though.

[YamiYukiSenpai]

If only it came with a microSD card slot...

[michaelocarroll007]

15 hours ago, Swatson said:

you crazy

 

 

I said margin not profit. They had margin on this phone.

 

 

I understand how and why it happens but it's not happening in this case, it does not cost more than $499 to make the essential phone. "Taking a loss" on the sale of the product does not include company expenses. As long as they break even or make any money at all per sale of a phone they are not losing on each sale.

 

Saying they didnt have enough profit on the phone to lower the price, and saying they did have enough margin to lower the price. are two very contradicting statements and margin and profit go hand and hand. Your probably thinking Gross VS Net Profit/ Margin.  at 250 cost 700 sell your Gross is 450 but then 200 gose to R&D and overhead and 100 goes to retailers. 150 left  for Net Margin/Profit.  Made up numbers obviously.  

 

 

Just because a phone Manufactering cost is 250 dollars its not able to sell them at $300 and make money.  Companies have an estimated overhead they apply on top of the BOM especially if its just one product they sell to come up with the selling price. Rent of offices warehouses electric computers IT systems Employees  Prototypes ect so huge of a list.

If sprint sells the phone they get a cut of the Price so for retail units there has to be profit in there for the re seller.  the list goes on and on.

 

Now the price of competition phones can make you rasie or lower the price compared to your real cost to make the phone but that comes after everything else. 

[S w a t s o n]

1 hour ago, michaelocarroll007 said:

snip

Again, I never used the word profit, just stop trying to make an argument where there is none. I used the word margin for a good reason. They had margin on the phone, they probably still have margin on the phone. I did not make any argument about profit net or gross.

Also, you're factually wrong about things like Sprint taking a cut, carriers don't make money on phones unless they get a deal/kickback.

[michaelocarroll007]

44 minutes ago, Swatson said:

Again, I never used the word profit, just stop trying to make an argument where there is none. I used the word margin for a good reason. They had margin on the phone, they probably still have margin on the phone. I did not make any argument about profit net or gross.

Also, you're factually wrong about things like Sprint taking a cut, carriers don't make money on phones unless they get a deal/kickback.

Cellphone companies  do have a wholesale to retail Markup......  Cellphone companies don't buy phones for 700 and sell them for 700. 

 

and i know you didn't use profit. Your using margin Without any context to what your actually talking about. You have no idea what or how margin is discussed in the buisness world it seems. which is fine Most people don't there is almost no reason unless your job entails it. 

 

there are a few different kinds  margins, including “gross profit margin,” “operating margin,” (or "operating profit margin") “pretax profit margin” and “net margin” (or "net profit margin") the term “profit margin” is also often used simply to refer to net margin

 

Also Margin is used in the stock trading world as buying Stocks on a loan and a margin Call would be when you lost too much money on the loan you need to pay up. this word is used for a insane amount of meanings without being somewhat more specific it doesn't work.  

 

 

 

 

[S w a t s o n]

26 minutes ago, michaelocarroll007 said:

snip

 

no you dont seem to understand that the word margin has many uses in many contexts and you're trying to win an internet argument, the way I've used it in this context is correct. I wont be responding again.

Edit: By the way, I've worked for T-mobile and Bell Mobility, you dont seem to understand the cellphone industry. The carriers dont sell phones outright very often compared to contracts and they are not making money on the device subsidy, lmfao. Even outright, they dont make money on the flagships.