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10 June, 2008

Early adopters' tax

Khoi Vinh uses the iPhone as an example of precipitous drops in the price of consumer electronics as the novelty wears off.

At its launch a year ago, the new 8GB, non-3G iPhone cost $599, but the price dropped to $399 within three months (that's for a new iPhone, of course; depreciation on the June batch would have been even greater).
By February this year, the price was $499, but for a 16GB model; Vinh estimates that would have stripped a further $100 off the value of his 8-month-old 8GB phone.
Then yesterday the iPhone 3G was released: the 8GB version can be yours for $199 – about as much as one share in Apple Inc. ($183.68, at the time of writing).

Investing tip: buy the company, not the product.

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