Apple's price rise no big deal say users

Apple Computer's decision to raise the price of its iMac personal computer by US$100 in the face of climbing component prices has been largely accepted, if not welcomed, by users interviewed at MacWorld Tokyo 2002.

The price rise, which was announced by Apple Chief Executive Officer (CEO) Steve Jobs during his keynote speech at the show, is the result of a sharp rise in the price of key components, he said.

"Since we introduced the new iMac in January, component prices have been increasing dramatically," said Jobs. "The price for our flat screen has gone up 25 percent in the last few months. The price for memory has gone up 200 percent since we introduced the new iMacs, that means it has tripled in cost. And this is an industry-wide problem, it is not just Apple."

"And so every manufacturer is going to have to do one of two things. Either remove features from their product or slightly raise the prices of their products. So we had to make this choice and we think the configuration of the new iMacs are great and the last thing we want to do is make them less great so we have decided to do price adjustments," said Jobs. "We've chosen $100. We are going to try to keep it as low as possible."

"We hope this is temporary but we don"t know what the component pricing in the industry is going to bring," he said. "We don't know long this will last."

While some users expressed a little dissatisfaction at the price rise, especially those that had been planning to buy an iMac, Jobs' explanation of forces outside of the company satisfied most.

"Price changes happen," said Mayumi Abe, a long-time Apple user. "It happened once before with the G3, too. And when the price was low, we benefited from that so I don't think it's a big deal. As a loyal Mac fan, I always believe in their strategy, so if they say raising the prices is right, rather than taking away some functions, I believe them."

Others agreed that price rises were preferable to reducing functions.

"As the company is moving forward with the new iMac, they definitely should not take away any functions," said Naoe Sato, another long-time user. "I credit the company for always doing something new and revolutionary, so if they need to raise the prices I understand," she said.

However some were a little less understanding.

"I don't like the price rise but if this is temporary, so be it," said Yoshinori Tashima, a Mac user at the exhibition. "It is right for them to raise the price rather than take away functions, however I don't think the new prices are reasonable."

James Yang, president of Denno Co. Ltd., a manufacturer of Apple peripherals, works closely with Taiwanese OEMs (original equipment manufacturers) on production of his company's devices and understands the reason behind the rise, but did not agree with Jobs' decision.

"You cannot increase the market prices in Japan," he said. "In Japan, the yen has fallen so prices have increased but nothing should change. You can only raise your price in the Japan market if you have something very special."

There was also some question of the Japanese price rise. At ¥20,000, the rise is approximately equal to $150, higher than the $100 increase in the U.S. An Apple Japan spokeswoman could not immediately explain the difference in the U.S. and Japanese price increases.

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