Steve Jobs Talks Beatles, iPod Pricing, Competition with Newsweek

by , 10:00 AM EDT, October 20th, 2003

Newsweek has published a short interview with Apple CEO Steve Jobs today taken during Mr. Jobs' publicity rounds from last week's introduction of iTunes 4.1 and iTunes for Windows. The interview covers such issues as iPod pricing (including an interesting exchange over Apple's policy on pricing), the lawsuit against Apple from The Beatle's record label (Apple Corps), and competition in the music download business. From the interview:

With Windows and Pepsi, you're aiming toward a mass market in downloading. But the iPod is premium-priced.
It's the No. 1 player in the world.

Still, US$300 to US$500 is an obstacle to a lot of people.
No, of course I don't think it's too costly. Fifty million homes have DVD players that cost that kind of money. For music lovers, I don't think it's a hurdle at all. There are sneakers that cost more than an iPod.

Some think you wouldn't want to sell a US$100 iPod because the profit margin would be so low.
What are you talking about? We'd love to have a $100 iPod! We just don't know how to do it right now. We're constantly trying to make cheaper iPods. We're working on the next step.

In the interview, Mr. Jobs also laments the lawsuit from the The Beatles, calling it "no big deal." Mr. Jobs says he loves The Beatles, and that he would "do anything for those guys." There's more in the full article, and we recommend it as a very interesting read.

The Mac Observer Spin:

"What are you talking about?" That Steve Jobs...Always pulling his punches.

We are in the camp of those who wish Apple could or would offer a US$199 or US$249 5 GB iPod in order to penetrate the market that much farther. Clearly, Steve Jobs sees it otherwise, but a US$100 iPod? It is just not possible to offer a device with all the features of the iPod for that kind of price point. Certainly Apple could make an MP3 player without a hard drive, the contacts, calendar functions (etc.), playlists, etc. for a hundred dollars or less, but then it wouldn't be an iPod.

Lastly, we love Mr. Jobs' quick dismissal of the initial "premium-priced" comment. The iPod is the #1 selling iPod player. The market very much will correct any over-pricing issues with the iPod, and Apple will eventually be forced to lower its price. For now, however, there are clearly lots and lots of people who are willing to pay Apple's "premium price."

One can argue that Apple's Mac pricing keeps some people from buying, but you simply can't make that same argument with the iPod. Reality belies such a notion.

MSNBC Article