How can companies upgrade their products and use higher end technologies each year while selling them for the same price
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Manufacturing and process improvements drive down the prices of many things.
Take for instance TVs, new technologies (like LEDs) mean that they could make better and better screens. New technology (like better factory robots) mean they can produce these faster, with less resources and less human labour, so cheaper. And they’re also learning as they go – they learn how to more efficiently run their factories, etc and thus do more with less.
Manufacturing and process improvements drive down the prices of many things.
Take for instance TVs, new technologies (like LEDs) mean that they could make better and better screens. New technology (like better factory robots) mean they can produce these faster, with less resources and less human labour, so cheaper. And they’re also learning as they go – they learn how to more efficiently run their factories, etc and thus do more with less.
Product upgrades aren’t new products. The system board on an iPhone 14 is probably mostly similar to the system board of an iPhone 13. Higher technology *is* the upgrade. Creative accounting is another reason why the price remains the same. Also look at the other services offered by companies. Phone manufacturers could see the writing on the wall for yearly upgrades and thus have dug deep into services. That’s where a large portion of revenue is coming from. Apple didn’t become a $3T valuation by selling iPhones.
Also, costs on the scale of Samsung or Apple, for example, are pennies on the dollar. That $1200 Galaxy S2x might cost the company $50 (on the high end) raw material cost to make.
Product upgrades aren’t new products. The system board on an iPhone 14 is probably mostly similar to the system board of an iPhone 13. Higher technology *is* the upgrade. Creative accounting is another reason why the price remains the same. Also look at the other services offered by companies. Phone manufacturers could see the writing on the wall for yearly upgrades and thus have dug deep into services. That’s where a large portion of revenue is coming from. Apple didn’t become a $3T valuation by selling iPhones.
Also, costs on the scale of Samsung or Apple, for example, are pennies on the dollar. That $1200 Galaxy S2x might cost the company $50 (on the high end) raw material cost to make.
Manufacturing and process improvements drive down the prices of many things.
Take for instance TVs, new technologies (like LEDs) mean that they could make better and better screens. New technology (like better factory robots) mean they can produce these faster, with less resources and less human labour, so cheaper. And they’re also learning as they go – they learn how to more efficiently run their factories, etc and thus do more with less.
Product upgrades aren’t new products. The system board on an iPhone 14 is probably mostly similar to the system board of an iPhone 13. Higher technology *is* the upgrade. Creative accounting is another reason why the price remains the same. Also look at the other services offered by companies. Phone manufacturers could see the writing on the wall for yearly upgrades and thus have dug deep into services. That’s where a large portion of revenue is coming from. Apple didn’t become a $3T valuation by selling iPhones.
Also, costs on the scale of Samsung or Apple, for example, are pennies on the dollar. That $1200 Galaxy S2x might cost the company $50 (on the high end) raw material cost to make.
In two words, the answer is [Moore’s Law](https://en.m.wikipedia.org/wiki/Moore%27s_law).
More than 50 years ago he predicted that the number of components that people could fit on an integrated circuit (i.e. microchip) would double every two years, and remarkably he’s basically been correct.
In two words, the answer is [Moore’s Law](https://en.m.wikipedia.org/wiki/Moore%27s_law).
More than 50 years ago he predicted that the number of components that people could fit on an integrated circuit (i.e. microchip) would double every two years, and remarkably he’s basically been correct.
the sale price has less to do with the cost of producing the item and more to do with what the market will bear. companies search out the highest they can possibly sell something for before people simply stop buying it. shareholders expect more return this year than they received last year. this is the primary driver of the current inflation crisis.
In two words, the answer is [Moore’s Law](https://en.m.wikipedia.org/wiki/Moore%27s_law).
More than 50 years ago he predicted that the number of components that people could fit on an integrated circuit (i.e. microchip) would double every two years, and remarkably he’s basically been correct.
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