Apple iPhone Looks Down on Inferier Products

Apple's Chief Operating Officer Timothy Cook launched a rather arrogant comment at a recent trade conference in Vegas, citing that:

"A lot of people pay zero for the cell phone. Guess why? That's what it's worth.." "If we offer something that has tremendous value, that is sort of this thing people didn't have in their consciousness -- it was not imaginable -- then I think there's a whole bunch of people that will pay $499, $599.''

So we should want to spend our hard earned cash on expensive devices?? Funny Apple. See, I had this crazy idea that cell phone service providers like AT&T were subsidizing the cost of new phones in exchange for your contract to pay them for at least 2 years of service. But I guess those phones are actually worth NOTHING because they're free. Boy was I wrong!

Now, I don't want to be speculative here, but doesn't this strike a similar cord to Ken Kutaragi's (Sony Computer Entertainment Inc) famous quote concerning the then unreleased PS3:

"[Our goal is] for consumers to think to themselves 'I will work more hours to buy one'. We want people to feel that they want it, irrespective of anything else."

It is a fact, Apple charges a premium for their products. Look how the ipod single-handedly inflated the mp3 player market. Trust me, hard-drives don't cost that much. Now I'm not willing to argue whether their products deserve that margin. It's slick, I'll give them that. But, I do feel there's a difference between 'confidence' and 'arrogance' and right now Apple is walking that thin line.

http://www.bloomberg.com/apps/news?pid=conewsstory&refer=conews&tkr=AAPL:US&sid=ayU3qJTMZ62w