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Wait, what?
Do you remember your econ 101 lessons? You know, those about price and demand?
Yes? Well, now read this.
First, the headline:
“Demand For Apple iPad May Be Higher Than Expected”
Fine so far, except, the article goes on to say that “Apple’s major hurdle to selling the iPad is probably price”
So, what is it? Demand is higher than expected, or the price is too high?
But wait! It gets better:
Apple may have to quickly cut prices the way that it did with the iPhone to keep consumer interest in the iPad high..
followed quickly by:
One of the ironies about Apple products is that high prices seem to make them more attractive than their competition
So, what is Apple to do? Lower the price to make it more attractive? Raise the price to make it more attractive?
I don’t mind people being skeptical about Apple products that haven’t been released yet, but this is ridiculous…
The Larnin Channil. Git Larned Good!
[Quote:]
Sure, you’ve heard that the Discovery channel’s parent company will give Sarah Palin a show on The Learning Channel, but did you know that Levi’s pitching an Alaska-based reality show called “Levi Johnston’s Last Frontier?” Meanwhile, Bristol is going to appear on ABC Family as herself.
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Cartoons
Check the Hype – There’s No Such Thing As ‘Cyber’
[Quote:]
How can you tell the difference between a real report about online vulnerabilities and someone who is trying to scare you about the security of the internet because they have an agenda, such as landing lucrative, secret contracts from the government?
Here’s a simple test: Count the number of times they use the adjective “cyber.” Nobody uses the word “cyber” anymore, except people trying to scare you and trying to make the internet seem scary or foreign. (Think, for instance, of the term “cyberbullying,” which is somehow much more crazy and new and in need of legislation than “online bullying.”)
Scary New GOP Poll
[Quote:]
On the heels of health care, a new Harris poll reveals Republican attitudes about Obama: Two-thirds think he’s a socialist, 57 percent a Muslim—and 24 percent say “he may be the Antichrist.”
My goodness, where did they get the sample?
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Writer J.D. Shapiro, who wrote the movie ‘Battlefield Earth,’ apologizes to viewers and explains how the bomb came to be
[Quote:]
Let me start by apologizing to anyone who went to see “Battlefield Earth.”
It wasn’t as I intended — promise. No one sets out to make a train wreck. Actually, comparing it to a train wreck isn’t really fair to train wrecks, because people actually want to watch those.
Parrots, the universe and everything
Intercepting mail is worthy of the Stasi
[Quote:]
The government is now drawing up plans to amend the Postal Services Act to allow tax inspectors to intercept and open people’s mail before it is delivered. Given the state’s ambitions to collect all communications data this is hardly surprising, but we must ask ourselves how many more rights are seized by government and its agencies before Britain becomes the GDR’s most obvious European imitator.
Currently postal workers have the right to intercept suspicious letters and packages and pass them to HM Revenue & Customs (HMRC) and then at an agreed moment the item is opened in front of the addressee. The change in the law will mean that HMRC will be able to open whatever it likes without the addressee being present or being made aware of the interception.
As usual, the government and HMRC public relations people underplay the wide-ranging and dangerous nature of this proposal by insisting that the new measure is simply designed to deal with the problem of tobacco smuggling. But the change, disclosed in a document published with the budget, means that HMRC will be able to trawl through private mail pretty much at will.
Well, but my econ lessons also contained the lesson that for certain luxury products the classical price and supply/demand relationship can get inverted. The higher the price, the more “exclusive” or “better” the product will appear, leading to more demand instead less demand.
This phenomenon is known for long, and applies to more items than we might imagine; not only Apple iPads. Best example: Cars. I can buy a Volkswagen for 10000 Euros, or I can buy a BMW for 40000 Euros. When compared completely rational, the Volkswagen is not 4x worse than the BMW. The overall quality might even be slightly better. But with a high-class car, you don’t buy better mobility, you buy higher “status”.
This relationship might also explain stock market bubbles. Nobody wants stocks when they are cheap, but everybody wants to buy frentically stocks when they are expensive.
I know – that still doesn’t explain his words – since he’s also calling for Apple to lower prices…
I bet he wants the prices lowered first, so he can get one cheap, then raised so he has a very exclusive and expensive phone.
“Apple’s major hurdle to selling the iPad is probably price”
and
“One of the ironies about Apple products is that high prices seem to make them more attractive than their competition”
are contradictory… On the other hand, one has to praise the author for considering both sides of the story here: if high price is causing the demand, then lowering it would cause fewer people to buy it and it is therefore not a hurdle at all, but on the other hand, many people who might be interested in the product are priced out. So we don’t actually know which it is without extensive market research.
“Apple may have to quickly cut prices the way that it did with the iPhone to keep consumer interest in the iPad high” is not actually contradictory at all, since it deals with psychology: consumer interest is a fickle thing and something may be a quickly passing fad if things don’t change in particular patterns over the life of the product’s promotion.