I don't get it though.
- If you accept that the Apple pricing is justified for the hardware you get, then flagship android devices with arguably better hardware should at least justify similar pricing. But high priced android smartphones get laughed at it seems.
- if you accept that android devices with similar hardware to apple should sell at $3-400, then why are people accepting Apple charging those prices? Why hasn't their margin collapsed?
Yes I realise this is a huge amount to do with marketing and brand value, but isn't that all just vacuous nonsense? Why is nobody going 'hang on, why are we paying $7-800 for these phones?'. Especially in the US which is supposedly such a price-sensitive market.
It is...
-Partly perception, whether justified or not, of iOS being faster and better than Android.
-Partly due to a better app selection; the vast majority of developers go iOS first, Android second (if ever) because that's where the money is.
-Partly marketing and brand power, yes.
-Partly due to a value proposition that better appeals to wider classes of people (ease of use, communication between Apple devices is years ahead of anything else on the market. I'm not saying it's a better value proposition, mind you, just that it's more appealing to many more people than what Android has to offer)
-Partly due to better design, materials, construction (nice Android phones are a rarity, most of them are ugly as sin)
-Partly due to better support (updates years after release, generally good warranty support)
-Partly due to platform lock-in (when you've got more than one Apple product, you're not switching. Nor will you if you risk losing apps you've bought, etc.)
-Partly due to better value retention (you can sell Apple devices much, much higher than you would a competing device once you're done using it, which amortizes some of the cost)
-Partly because Apple products are seen as a status symbol (especially true in China and other developing countries these days, but also true in Occidental countries)
-Partly due to personal preference, often.
The problem you have, like most geeks evaluating smartphones, is that you equate value with hardware specs, which is as far as you can get from the typical consumer's mindset. Apple has high margins because people are willing to pay for an experience which is perceived as superior to what competing smartphones offer. That has nothing to do with how much it cost to produce and everything to do with the fact that they differentiated their product enough that consumers consider the competition inadequate unless they're on a tight budget. When they have enough money to buy an iPhone, there is no product currently that the consumers see as close enough to consider buying.