why does storage capacity makes such a difference in pricing devices when the difference between 128gb and 256gb SD cards is only ~10$?
In: Economics
The answer is money. More storage conveys a more premium device. So they charge accordingly.
There are a few factors involved here.
1. Profit margins: if the manufacturer spends $10 extra for the 256gb SD, they have to mark the final product up even more in order to maintain profit margins. If they only charged the consumer $10 more they would basically have 0% return on the $10 they spent.
2. Accessibility: a lot of modern devices do not have accessible hard drives. It would take a well trained person and sometimes special tools in order to swap from a 128 to a 256. For this reason the manufacturer is able to sort of monopolize on the storage capacity. They can mark up the extra storage as much as they want knowing that an average user won’t be able to spend $10 and swap them themselves. This is probably reason number one. It’s also the reason why they market different capacities in the first place, rather than just putting ample storage into every device.
3. Production: in order to make a device with two different storage capacities, you either need two different production lines, or you make one, stop the line, swap the components for the other and start again. So in this sense you are partly paying for the time/capital used to market the different capacities.
https://www.reddit.com/r/explainlikeimfive/comments/6g62z0/comment/dio65sz/?utm_source=share&utm_medium=mweb3x&utm_name=mweb3xcss&utm_term=1&utm_content=share_button explains that there are differences. the more you put into the same space, the harder it is, and so it becomes more expensive. in the analogy, a crayon vs. a pen might not be a large difference but imagine a pen with a 0.1mm nib instead of 1mm
Strange parts did a video on this a while ago. https://youtu.be/rHP-OPXK2ig?si=Ar5bw14XbVQkxzob
Basically, it’s just a way of getting people with more money to pay more.
It’s price anchoring to some extent. If presented just with the option to buy a device at $600, people might not think it’s worth the money. So you offer a ‘pro version’ at $950 and suddenly the normal version seems cheap – look at how much money you’re saving by buying that instead of the premium version!
But on a more basic economics level, offering more versions allows for matching the demand curve. There’s a basic problem with fixed prices that not everyone is willing to pay the same price for the same thing – some people value the thing more than they value their money, or vice versa. So ideally what you would do is just charge every single person the exact amount that they are willing to pay for it. In practice, you can’t do this, though. If you can offer two different prices for what is essentially the same thing from a manufacturing cost perspective, that solves the problem somewhat – people who value money less will buy the higher-priced one, and you still don’t miss out on sales to people who wouldn’t be willing to spend that much. See also: cars that are sold in various different configurations and feature sets; coupons; steam sales.
The difference in pricing for devices with more storage is not just about the cost of the memory itself. While the production cost difference between 128GB and 256GB is small, companies charge more for added storage to increase profit margins. People are willing to pay for the convenience of built-in storage, and higher storage options are often viewed as premium, allowing companies to set a higher price even though the actual cost difference is minor.
Because Apple tbh. They are the ones who started this bullshit trend of overpricing storage on iPhones to make it seem “premium” and influencing other companies to continue this predatory tactic. Samsung and other Android brands always gave us microsd card expansion ports on phones, but unfortunately even they are starting to slowly stop making new phones with those ports, especially the flagships
Mobile companies gauge the prices.
But just as an FYI, you cannot compare sd cards to the internal storage of mobiles. the internal nand storage chips used are far superior than sd nand. they are much faster and live much longer.
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