Tuesday, July 03, 2007


How the Iphone Avoided Being Ebayed to Death

The whole iPhone thing is a miracle. Just look at the Wii and the PS3. Two hotly wanted items. Both ebayed to high heavens during the first 3 months. Ruthless speculators with the time to hunt it, holding the devices hostage. Avid Gamers that want the system, forced to pay a premium for its release.

So, how did Apple avoid this?

1. They released it only in America. Easier to plan and control the logistics when all the data is in the same country. Shipping streamlined. Distribution quick. Supply can be quantified

2. They only allowed two retailers. No unscrupulous Toys R US workers taking the devices off the market for Ebay purposes. 90% of the iPhones were retailed through Apple stores = 0% corruption. Demand can be quantified.

3. They pre-planned. Apple talked with Ebay beforehand about how they should quickly take down any iPhone reselling ads. Early speculation halted.

4. They allowed people to buy more than 2. Speculation comes in waves. There are the early spectators who take a lot of risk in the first week/day. Then comes the careful spectators--the bigger wave that usually contains the more successful spectators of the first wave (often using the proceeds from their earlier speculation). By allowing the first spectators to buy two, and then making the speculation go bust, that gives the speculator a negative -1000 in their wallet. An ouch that makes them think twice about trying to speculate again. Snowball anti-speculation effect. Late Speculation halted.

I'm not sure any other company except Apple could have implemented such a top down effort to stamp ebayism of their product. But dammit, it is beauty to behold.

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