[ad_1]
For many, this winter is the season of inflation. After oil prices spiked (and slowly started to fall) earlier this year, everything we have to pay for suddenly seems more expensive. Outside of the gas station, this is mostly felt in the grocery store, where bread, pasta, vegetables, and other consumer goods all cost more now than they did a year (or even a few months) ago.
Inflation has affected the prices of technology products like smartphones and laptops, but it can be difficult to detect. Unlike food or other consumer goods, technology products have a long manufacturing cycle, often taking 18 months or more to go from idea to store shelves. Many companies set their product target price early in the growth cycle, making them more insulated from short-term inflation. After the release of technological devices, the price rarely increases; In fact, we have become accustomed to them becoming less expensive over time.
But this year, we’ve seen many examples where the devices are clearly expensive or haven’t depreciated over time. Part of this is due to ongoing supply chain problems that make it difficult for companies to source devices, especially for devices that don’t use high-end smartphone or laptop processors. But big companies aren’t immune to the effects of fuel costs and other inflationary pressures, and that can drive up the price of your next gadget.
Let’s look at a few examples.
Apple’s new MacBook Air, which was announced in early June and began shipping in July, comes with a $200 starting price from the successful model. It’s hard to say that’s entirely due to price increases, because the new Air comes with a lot of new features to help justify the cost: a new chassis design, a better display, a faster processor, and so on.
But Apple is still selling the older MacBook Air alongside the new one, and it’s still listed at the same price when it comes out in 2020. Apple typically lowers the price of older models when new ones come out. It gives smart (and patient) consumers a way to save money on the most powerful technology yet. But with the new model coming at a higher price, Apple didn’t have to undercut the old one to make it look like a deal — you’ll still pay $999 for the entry-level MacBook Air with the M1 processor when you buy it in November 2020.
Samsung recently announced a whole bunch of new wearables and foldable phones, and the impact of inflation is clear there. The Galaxy Z Fold 4 and Z Flip 4 are identical to their predecessors, but the new Galaxy Watch 5 costs $30. More More expensive than the Galaxy Watch 4, though it only comes with a slightly bigger battery and one (very useful) additional health sensor. Anyway, it’s the same watch as the Galaxy Watch 4, but it costs more than the Watch 4 did when it launched last year. Similarly, the new Galaxy Buds 2 Pro are $229, $30 more than the Galaxy Buds Pro that came out in January 2021.
Other companies have made unusual moves by raising prices on existing products. Late last year, ahead of inflation in 2022, Sonos raised prices on its line of wireless speakers, raising supply chain costs. Meta recently raised the price of its Quest 2 virtual reality headset by a whopping $100 (a 33 percent jump) as it tries to address its own revenue drain in the business. Quest 2 may have been a financial loss for Meta at launch, but thanks to other business and economic pressures, it’s clear that Meta doesn’t want to stay afloat, and so consumers will have to pay more in the future.
Incidentally, last year it was hard to find great deals on technology. A year ago, I was able to get a one-year-old iPad Pro for hundreds of dollars at Best Buy. When I looked for a similar deal this summer, the big box stores came up empty, and I had to poke around eBay until I found a price I was willing to pay. Our deals team saw fewer big deals on new-in-the-box products across the board this summer, with most of the best sales occurring on refurbished or second-hand equipment. (Pro tip: Buy refurbished if you can – it saves you a lot of money, and keeps things out of the landfill or recycling.) Another factor that drives up prices is simply a lack of supply. – Demand products, thanks to continuous supply chain woes.
As we head into the big product launch season, we expect to see more effects on inflation from new phones, laptops and other devices being announced. Industry analysts are warning that the iPhone 14 will be more expensive than the iPhone 13. If that continues, Apple will be able to keep the iPhone 13 in the lineup without cutting prices like older models have done in years past. At the same cost as a year ago, it still seems like a savings compared to the new one. Apple is also expected to use the same processor in the iPhone 14 as the iPhone 13, which is similar to how Samsung’s new watches use the same chips as last year, but are expected to cost more.
Amazon is reportedly raising sales charges this fall to combat inflation — you can certainly expect that cost to be passed on to the consumer, meaning your next USB-C cable or phone case could cost more. More.
We’ve gotten used to the ever-decreasing value of technology, and if you look at the long-term scale of decades, that’s still the case. But we can’t expect technology to be independent of the rest of the economy forever, and if your next loaf of bread costs more than it did before, so might your next smartphone.
[ad_2]
Source link