Why don't plan-subsidized prices count? As long as we're comparing iPhones on plans, I see no reason not to count them. The article compared the $0/$99 iPhones on a plan to $0/$99 Androids on a plan.
I think you have a valid point about segmenting only the upper end of the market though. Apple has always catered more to the upper end than anything else, but it works for them. Segmenting this end of the market is still a very lucrative proposition for them. Also, the fact that the top selling smartphone in the US is the iPhone meaning they're currently able to cater to the whole of the smartphone market very effectively, not just the upper end.
I agree this isn't a good strategy when the 3rd world countries start going strong on smartphones, but that doesn't mean it's not a good strategy now. Perhaps when that happens they will fundamentally have to shift their focus from catering only to the upper end of the market to a broader one, but I don't think that will happen soon enough for them to change their strategy now.
You're not taking into account plan prices. All three iPhones come with a $70 plan, right? Well even the "free" Android phones can come with plan prices of $20. I don't know how much of a big deal that is in USA, but in the rest of the world it's a huge deal. Almost nobody has plans than go over $20-$30, except maybe in UK.
I guess there can be so many different plans, and I have no idea what kind of plans do you have in US. It makes more sense comparing the actual device prices than some plans.
because plan-subsidized prices depend on the negotiator, i suppose?
the network company i am currently with offers a plan for the iphone/android cellphones too. i can get the Samsung Galaxy Note or HTC One X for the same price/same contract as an iPhone 4.
I am not sure i would say "inexplicably runs Android 2.2, looks like a Hummer, & has 3 hours of battery life" about either the Samsung Galaxy Note or the HTC One X.
edit: and since i pay around EUR 6,00 per month for my mobile telecommunication needs (EUR 4,00 for internet, rest for voice, EUR 0,00 for text), I am not sure I care about plan-subsidized phones either (unless they are attached to a EUR 5,00 plan).
On-plan prices matter to you about as much as off-plan prices matter to most American consumers. The majority of them get phones with contracts, particularly when you're considering smartphones.
I think you have a valid point about segmenting only the upper end of the market though. Apple has always catered more to the upper end than anything else, but it works for them. Segmenting this end of the market is still a very lucrative proposition for them. Also, the fact that the top selling smartphone in the US is the iPhone meaning they're currently able to cater to the whole of the smartphone market very effectively, not just the upper end.
I agree this isn't a good strategy when the 3rd world countries start going strong on smartphones, but that doesn't mean it's not a good strategy now. Perhaps when that happens they will fundamentally have to shift their focus from catering only to the upper end of the market to a broader one, but I don't think that will happen soon enough for them to change their strategy now.