SDK apps

[fishcube]

So, where are these SDK apps? When will there be apps to download?

[jhollington]

The SDK has only been released to the developer community at this point.

The SDK apps that are being written will require the iPod touch or iPhone 2.0 firmware, which is not being released until June. When the new firmware is released, applications will be distributed via the iTunes Store and via a new "App Store" icon which will appear on the device itself.

[PG4G]

At that time, all unnessesary threads about this stupid stuff that they can just search Wikipedia for, will vanish.

This will result in an explosion of people leaving iLounge.

This will in turn cause an implosion of matter in the universe.

This will cause a black hole where iLounge used to be.

Oh, wait, we aren't here to be "solve your problems.com"?

Really? Wow! What a relief :P

[Orcin]

In honor of that last post, here's another stupid question from a n00b...

Has it been announced yet whether firmware 2.0 will be a free download or a purchased application?

[BlackWolf]

In honor of that last post, here's another stupid question from a n00b...

Has it been announced yet whether firmware 2.0 will be a free download or a purchased application?
not that stupid, considering that it's free for iphones but ipod touch users will have to pay for it ... or at least for the appstore ;-) only wrong term here is "application"

[kornchild2002]

We still don't know how much it will cost. Jobs said it would be a nominal fee or some such crap which means it could be anywhere between $5-$20. It depends on what Apple's definition of a nominal fee is. To them, a nominal fee could be $20. To the end user, $20 is simply too much to get the 2.0 firmware especially given that it is free for iPhone users and will be free for people who purchase iPod touches after a certain period.

[PG4G]

Hopefully Apple learns from the storm after last time...

But how many people bought the upgrade anyway? I did :o

[AshenScurry]

I have read/heard else where that iPhone users pay like $10 per month via their phone bill to keep the software/firmware updated, so $20-40 is getting of somewhat cheap.

[BlackWolf]

I have read/heard else where that iPhone users pay like $10 per month via their phone bill to keep the software/firmware updated, so $20-40 is getting of somewhat cheap.
lol no, but iphone users just pay xx$ anyway as their phone bill ;-) it doesn't really make sense, it's just a cheap excuse from apple why they charge ipod touch users.

[PG4G]

I'd disagree with that statement entirely. You have to look at this as it is written out in contract. Money is passed from the telco (telephone company that is) to Apple, and it is written into the contract with Apple that Apple promises to provide software updates as part of that money hand over agreement.

In that sense, it is direct payment for the development of the products.

iPod touch users don't pay that bill.

You look at that bill and say that it is, for example, $60 for X amount of calls, X amount of text, and unlimited data. Actually, it is $10 to Apple, and $50 for those features. They omit that imformation. It is exactly the same as the principle of getting a free phone if you get a plan, as it works on other phones. The Phone company buys the phone, and then everything acts like it is free, except when you want to cancel the plan, and they will charge you all the unpaid part of your phone costs.

The cost isn't actually $10 for sure, but it would be around there.

It depends on the company's contract with Apple and the customers.

[kornchild2002]

iPod touch users don't pay that bill.


Although I agree with your statement regarding a monthly bill, iPod touch users still pay a fee. The components that make up most of these DAPs run for about $50-$150 yet they charge $399 and $499. Apple is making quite a bit of money on every iPod touch (or every iPod for that matter) that they sell. They are also making quite a bit of money for every iPhone that they sell. The only difference is that iPhone users continue to pay Apple (well, the cellphone company which then passes it onto Apple) a small amount of money every month. Still, iPod touch users pay upfront so I think they would be entitled to free updates just as much as iPhone users. I could see iPhone users getting exclusive apps that make use of the cellphone signal but iPod touch owners pay as well.

[DerekVOF]

Components are definitely not down as low as $50 - the original 8GB components were dissected and cost approx $150 -- http://gizmodo.com/gadgets/poked-and-prodded/ipod-touch-dissected-analyzed-335134.php

And the iPhone users don't pass on a "small" amount -- in a two year contract Apple is supposedly picking up an extra $432 per iPhone, according to Piper Jaffrey's analysis -- http://www.crunchgear.com/2007/10/29/analyst-claims-att-pays-apple-432-per-iphone-contract/

I'll take $20 once or twice a year rather than $216/year (going to Apple) just to own an iPhone...

[jhollington]

Further, the additional reality is that there is far more to the cost of producing a device than merely the cost of components. These analyses by iSuppli and the like do a huge disservice by working people into a lather in believing that Apple is nothing more than a money-grubbing company ripping off its consumers.

While that assessment is not necessarily untrue (and could easily apply to any major corporation), let's be fair and understand that the profit margins on iPods are not as massive as these reports would have us believe. Anybody who honestly thinks that the cost of an iPod is merely the sum of its components has absolutely no idea what it takes to develop a product or to run a business.

Consider that the 8GB iPod touch has $150 worth of components in it (and to be fair, I've also doubted the veracity of iSuppli's costing analysis in many cases, since not all parts used are "off-the-shelf" components, but we'll assume it's correct just for the sake of discussion). While on the surface Apple would therefore appear to be making $150-$250 in pure profit per unit, nothing could be further from the truth... First, there are the actual production costs directly associated with the device... Whatever is costs Apple in labour and contracting costs to actually make the device, since even in China these folks don't work for free (Jobs' Reality-Distortion-Field isn't that good ;) ). Secondly there are the research and development costs.... Normally these are amortized over the lifetime of expected sales of the device, but in the most basic terms, it refers to the fact that Apple needed to pay their designers and engineers in California to actually think this thing up, test it, develop it, and make it work long before it even went to manufacturing. These costs have to also be recouped against sales of the device itself.

To be fair, the more devices they sell, the more this cost goes down, which is also why prices eventually drop in most cases. Apple is a little strange when it comes to price drops, but even then it's there. The number of iPhones sold last summer probably exceeded Apple's expectations, the R&D expenses were "paid off" faster than expected, and this therefore contributed to a justifiable price decrease -- hence the $200 price drop in September.

All of this comes down to the "gross profit" made on each device, which you can already imagine is now somewhat less than the projected $150-$250 per unit. However, we're not done.... On top of all of this, Apple has to cover support and warranty costs for the device (remember that every defective iPod touch that is returned to Apple involves the expense of giving away a free unit and taking the time and effort to diagnose and/or repair the defective one). Further, they also still have to keep the lights on, pay their rent, pay their administrative staff and even their retail store employees.

This results in what is known as their "net profit" which conservatively is probably going to work out to a much smaller percentage of the selling price of each device (the numbers are readily available in Apple's Annual Reports, although net profit is not expressed as a per-device cost, since it's an aggregate of the gross profit from all of Apple's revenue streams with operating costs deducted as a whole).

There have been some reports, in fact, that due to the number of defective iPhone units that came back in the fall/winter that Apple would have actually be losing money on the iPhone due to support costs, were it not for the carrier per-unit kickbacks.

Of course, the iPhone situation is much more complex from a business point-of-view than the iPod touch, since Apple realizes the revenue over a two-year period for accounting and SOX purposes. This means that even though you pay for the device outright, Apple is receiving money on their balance sheet as if you were leasing the device, not purchasing it -- the money you pay for your iPhone has to be put into what is essentially a "holding" account, and gets divided out evenly over a 24-month period -- basically in 24 equal payments.

The iPhone is ultimately a subscription-based business model, so in the same way that you get upgrades for free if you're paying for a "software maintenance plan" the iPhone updates are also essentially included. The iPod touch does not follow this model. The reasons for this may or may not be the same as the SOX issues that came up with the 802.11n upgrade, but at some corporate accounting level it's a similar scenario.

[fishcube]

Thanks J

Glad to know we'll see apps starting in June.

[AndyT4097]

So were going to have to pay for the firmware upgrade, then for the apps, thats nice.:rolleyes:

[Seffrythe]

Yeah I think its a crock too but what can you do. Really I am not to hurt about it because I was not impressed with any of the apps they showed when they announced the dev kit. To be truthful I was kind of let down and currently the only one I would really want is if Microsoft actually does release their office docs on an app. Yes I realize that was only a small taste but you would figure to try to get hype for it they would have presented really kick ### apps for it and they didn't in my eyes.

[PG4G]

It will be slightly complicated if Microsoft release for the iPhone OS, as it is hard to get around the sandboxing rules.