Apple Tax Is All Perception


Historical perception of Apple products has always been that there is an inherent cost differential between them and their competitors, coined by Tony Bradley at Forbes in a recent article as the “Apple Tax.” Both that article and other independent cost comparisons, however, fail to justify that perception. For comparable products of similar quality and functionality, the numbers make it clear that this alleged up charge is all in the minds of those consumers with a conditioned expectation of an elevated price point. Those trend setters willing to pay the price to have the cutting edge of technology in order to maintain their status have been getting a bargain in actuality.

A comparison of the iPhone 6 and iPhone 6 Plus against the Samsung Galaxy S5 and the Samsung Galaxy Note 4, similar devices and progressions, found that they also had similar pricing. The features and quality were comparable, and all fell in the $800-$925 price range. There is no evidence of an “Apple Tax” simply for the prestige and perception of the name.

Laptops vary widely in features, construction materials, and capabilities, and it is easy to find PC products which are functional that retail for a significantly lower price than the Apple offerings. Evaluation of those differences tend, however, to justify the price gap according to Bradley. Another comparison recently published found that when not bargain hunting, and comparing a nearly identically equipped MacBook Pro with a Dell XPS M1730, the Apple computer was matched point for point with the PC and even had a slight advantage in terms of gaming functionality for the exact same price. Neither the up charge nor the superior technology was anything more than a product of customer expectations. A similar comparison of a MacBook Air to the Envy 133 from VoodooPC actually showed the Apple to be a less expensive machine, even with an upgrade to match functionality, than the PC. For nearly identical packages, the idea of paying more for the Mac name was nothing more than a false impression.

With respect to the watch products compatible with smart phones, the comparisons are more difficult to make. There is a significant price difference in the Apple Watch line and the Samsung Gear products. The Samsung watches are around 150 dollars less expensive, but provide far fewer features. The only area where they are ahead of Apple is with respect to durability. The Samsung has a better rating for water and dust resistance. It also has the advantage of being immediately available where the Apple will not be available until early 2015. Given the differences in features, the price difference does not really appear to be an inflated “tax” as much as representing an actually superior product.

The prevailing thought is that the lack of third-party devices which are compatible, in particular devices constructed to a lower standard offered at a lower price point as is the case with PC products, gives an impression of exclusivity and quality which accounts for the perception of an “Apple Tax” on their devices. Upon closer inspection, however, it just is not there.

By Jim Malone

Image courtesy of Anthony22 – License

Leave a Reply

Your email address will not be published.