Headline Feeds
Conversation in the Apple-focused blogosphere is all over the map this week, but with Apple (Nasdaq: AAPL) in the tech world's driver's seat these days, wide-ranging activity is only to be expected.
Out of dozens of news nuggets, here are three that create some interesting glimmers: iSuppli's teardown of Apple's diminutive iPod shuffle reveals a tidy profit margin; AT&T (NYSE: T) reportedly wants to keep its lock on the U.S. iPhone channel; and Apple is offering an $899 iMac -- but only to educational institutions.
The Mighty Margin
Apple's tiny, third-generation, 4GB iPod shuffle, according to iSuppli, has an equally diminutive bill of materials -- the research firm says components cost just US$21.77. With a retail 
price of $79, that gives the iPod shuffle a nice profit margin. Of course, the difference isn't all in the margin -- iSuppli doesn't factor in the costs of licensing fees, royalties, software, shipping, or other development and channel-related costs.
Blog chatter ranged widely over Apple's so-called profit margins and corporate coffers, as well as price drops and rises for the iPod shuffle, which have done as low as $49 before creeping back up to today's $79 -- all of which brings to mind other low-cost MP3 players.
"The original price point has always been $79. They cut the price after they had been on the market for a long time. Other MP3 players are crap, which is why they are $30," commented hillstones on the AppleInsider.com post on the subject.
So how much do other low-cost MP3 players cost to build, anyway? Has iSuppli bothered to teardown any others?
"With respect to other non-display MP3 players -- we haven't done any," Andrew Rassweiler, director and principal analyst of Teardown Services for iSuppli, told MacNewsWorld.
"We actually haven't done any other media players other than Apple products, since Apple is the main 'big' player in the space (media players). The rest of the industry is composed of countless smaller-player manufacturers, none of which, in our opinion, really were worth analyzing as an individual teardown," he explained.
"Other companies can build them as cheaply, if not cheaper, but the end products are not comparable," he added.
AT&T to Apple: 'We Want Your iPhones - All of Them'
When Apple begins selling the iPhone in any particular country, it typically partners with a single carrier service there in an exclusive arrangement. The biggest of these, of course, is AT&T in the United States. While AT&T has apparently been doing a pretty good job selling and servicing iPhones -- millions of ongoing sales are hard to argue with -- the fact that the carrier may provide excellent service in any given city provides little consolation to those dealing with lousy coverage in their particular home areas. Then there's the mandatory $30-per-month charge for data services, regardless of whether a customer uses the iPhone for Web browsing or not. Still, are people exactly complaining in droves? More to the point, are they willing to ditch their beloved iPhones?
AT&T is in discussions with Apple to lock up its exclusive iPhone contract until 2011, according to The Wall Street Journal. It's currently believed to be slated to end in 2010.
"But is the AT&T exclusivity deal good for anyone other than AT&T?" asked Lonnie Lazar on the Cult of Mac post on the subject.
"From Apple's perspective, it's likely good insofar as it keeps things simple, having only one behemoth service provider to potentially screw up the tightly controlled customer experience around which much of Apple's mystique has been been built," Lazar added. It's time, Lazar said, that Apple offered the iPhone to consumers who want to use different carriers.
"Anyone remember that report that came out estimating how many of the 1st gen iPhones Apple had sold which weren't being used on ATT? Locking to a single carrier is limiting sales. Not a good thing in this economy," added MacRat.
The idea of an open-carrier iPhone got a generally positive reception among bloggers.
"I know of several people who do not have iPhones for the SOLE reason that you have to have AT&T. Personally I work for an cell phone company (NOT AT&T) and therefore I don't have an iPhone -- though I would LOVE to have one. But for others I know it is simply a case of poor reception or poor customer service that has driven them from AT&T. One even has sold his iPhone and went back to his previous carrier due to the poor reception and performance. It is in EVERYONE's best interest (except AT&T) to have the iPhone exclusive rights of AT&T end!" commented Phatslacker.
However, perhaps the issue isn't so clear.
"I had Sprint (NYSE: S), then T-Mobile, and now ATT for the iPhone. NONE have been spectacular in either their level of access or their customer service, and I have no reason to believe that Verizon would be any different. I'm not a big ATT fan, but I'm not a big fan of the other choices either, because, as I've said a million times ... they all suck," added jltnol.
Will the iPhone Mystique End With Ubiquity?
"While being offered by several carriers in the U.S. would help drive increased volumes for iPhone, as it did with international launches, working with more than one carrier in a market would cause the Apple brand to lose importance as all carriers offer the device," Chris Hazelton, research director of Mobile & Wireless for The 451 Group, told MacNewsWorld.
"By going with one carrier in each market, the Apple brand and corresponding services like App Store and iTunes are used as a differentiator, and Apple competes with other device vendors at the hardware and software level -- instead of being an enabler for carriers to compete with each other's branded services, as with France's Orange launching mobile TV on iPhone after losing its exclusivity deal," he explained.
"Working with multiple carriers is a volume play, selling more devices, but Apple does not want to be a volume leader. Apple has always had limited channel partners for its desktops, notebooks and iPods -- online and Apple retail stores. iPhone will be no different -- sales will be limited to Apple and AT&T to protect margins and remain a high-end device margin leader," he added.
How Come the Schools Get All the Great Deals?
Meanwhile, the blogs have been rattled by chatter over Apple's low-end iMac line for educational institutions -- the iMacs that Apple sells to schools and pretty much nobody else.
Basically, Apple is now selling a 20-inch aluminum iMac for $899. Meanwhile, the consumer-grade, entry-level iMac -- also a 20-incher -- comes in at $1,199. However, before you start drooling over the $899 model, consider the low-end specs: It's got a 2.0 GHz Core 2 Duo processor, only 1 GB of RAM, and a 160 GB hard drive -- though it does come with a SuperDrive and the new GeForce 9400 graphics processor.
The consumer 20-inch model boasts a 2.66 Ghz Intel (Nasdaq: INTC) Core 2 Duo processor, 2 GB of RAM, and a 320 GB hard drive -- quite a bit more oomph. Still, isn't that $899 price point gloriously tantalizing?
Only in the Land of Apple
A lot of the posts on Tom's Hardware appeared to bash Apple for selling an overpriced machine at $899 -- compared to cheaper PCs, of course.
"Wow what a deal, they are selling the old discounted models to students and asking them to pay through the nose for them ..." commented jsloan.
Some, on the other hand, took the Mac road.
"I work in a school that has both new Dells and 5 year-old eMac's with 1Gb of RAM. The eMac's are far superior to the Dell's (Nasdaq: DELL), and by the time you get all of the MS software then you are far beyond the price of the Mac. The life cycle of the PCs is about 3-4 years, whereas the Mac 5-6. I still have not found a PC laptop with the EXACT same specs as my new 17" MBP that is cheaper. BTW, I build my own PCs and have two Win boxes and two Macs at home," commented Yoder54.
Still, the low-end iMac for education just might not be suitable for consumers -- at any price.
"In general ... a problem for the iMac and other 'all-in-one' PCs like the HP (NYSE: HPQ) TouchSmart and Dell XPS One is the higher price than an average laptop. Consumers have embraced today's laptops for home computing for its attributes of portability and processing power now on par with many desktops. Only a small group of consumers are willing to pay more for a home PC for the better look and spacing saving of all-in-one devices," Bruce McGregor, a senior analyst of Digital Home Services for Current Analysis, told MacNewsWorld.
"Also, in my opinion, their best use in the home is a shared kitchen counter PC to act as a home's media and communications hub. Furthermore, if a household desires an all-in-one computer, they should not sacrifice processing power for beauty," he added. A Dell XPS One 20, he noted, can be found online that comes with 2 GB of memory and a 250 GB hard drive.
Still, the point remains: $899 for an iMac is the kind of price point that could entice more than a few Mac lovers to clear off their kitchen counters.
Talkback: 
