[First] Buyers Beware: Price Cut Coming

Sept. 8, 2007 — -- In June, early birds shelled out $600 for the first Apple iPhones, and since its release having an iPhone has been a status symbol for a select few.

But now, just two months later, Apple's CEO Steve Jobs announced, "We are going to price the 8 GB model of the iPhone at just $399." ... And Apple customers are none too happy about the news.

"I was just a little taken aback that it was so soon," one man said.

But the reality is, price tags on new technology will always drop.

A year and a half after the X-Box 360's gaming console debuted, $50 was slashed from the base price. As for its competitor, the PlayStation 3 console, its price dropped $100 just six months after it hit the shelves.

And in perhaps biggest high-tech markdown of all, the Razr phone debuted in 2005 for $500 -- and now it's $50 with a contract.

"Technology is moving at the pace of fashion," said Ken Dulaney, a mobile computing analyst for Gartner Research. "This phenomenon of pricing and price reduction is not a great anomaly."

But $200 cut in just 10 weeks? For the Apple faithful who bought the iPhone, it hurts.

"They've gone from being envied," University of San Francisco Professor J.P. Allen said, "to being labeled as losers for having paid too much for their iPhones."

Steve Jobs did issue an apology on the Apple Web site and is offering a $100 Apple store credit for anyone who paid the initial $599 iPhone price.

Apple is rumored to have sold about 750,000 iPhones at the introductory cost of $599.