Thursday, September 29, 2011

Will Apple kill the Ipod Classic and Shuffle?

According to recent activity on a reliable blog concerning Apple news, the unveiling of the new Iphone 5 will come with other news as well.  The common speculation is that apple will be discontinuing the sale and manufacture of the classic and shuffle models of Ipod.  This information must be questioned and using basic economic ideas we can formulate an accurate prediction of the company’s next move.  In the company’s last earnings report it was shown that only seven percent of the company’s earnings was from the Ipod.  This shows that the public’s demand for a device that solely functions as an Ipod is transitioning as better devises with more functions are made by apple.  These newer products like the Iphone and Ipod touch have become substitutions for the classic and shuffle.  The newer models have all the same features that these two products valued as their key features.  It is possible that the marginal costs of these products have also begun to become higher the marginal revenues for these older products, as the demand slowly shifts to the newer products, due also to a drop in the equalibrium price.  Considering this, it seems obvious that there are more costs of keeping the Ipod classic and shuffle around.  Therefore, economically speaking, it makes perfect sense for Apple  to be discontinuing these relic models of the Ipod.


Molly Aaron said...

It does make sense to discontinue the products if sales are so low, but some people are still buying them for their basic abilities. Not everyone wants to carry around a device as big as the Itouch, they would rather carry around something small like the shuffle or nano. Many consumers choose these for excersize purposes because it light weight and easy to operate on the go. Instead of having to turn on the Ipod touch that requires you to slide the screen to unlock, then finally be able to change the song, you can switch to the next song with just a click of a button. Will sales may be lower, I think it would be at Apple's best interest to continue the sales of the basic Ipods, but perhaps produce less.

Andrew Boyd said...

By what Nick said in his post, Apple should discontinue the Ipod classic. The quantity supplied is more the the quantity demanded resulting in disequilibrium as well as an excess supply. Apple has already started to discontinue models of the iphone because of the new iphones that hvae been released. I believe that is what apple should do with their classic ipods. A business' goal is to maximize profit and by Apple keeping products that stretch them farther from equilibrium, they are not getting closer to their goal.

Lauren said...

Althuogh Apple is not making as much money from the Ipod classic and shuffle i believe that Apple shuold keep those models still. Many people still use them for reasons such as a gift for children that want to use an item solely for music and not for other things like the Ipad is used for. Also it is much more accesible because of its small size. I think Apple should just lower the price on the ipod shuffle and classic so that more people can buy them.