Just one more thoguht on this topic of the iPhone price drop (for which Apple is now offering to give a credit of $100 to early buyers). It occurs to me that the complaints over this may have something to do with what Barry Schwartz refers to “the tyranny of choice” (or the “paradox of choice” if you read the book version).
The iPhone price drop is an example of an opportunity cost. Schwartz talks about “maximizers” (people who constantly seek out the best possible choice, and even after making a purchase continue researching options) and “satisficers” (people who seek out a “good enough” choice and then, once made, stop looking further). In reality everyone is a mix of both, depending on the category in question, but when it comes to technology, early adopters are almost by definition maximizers. Maximizers are particularly vulnerable to the tyranny of choice, which actually tends to make them less happy overall. He says:
Several factors explain why more choice is not always better than less, especially for maximizers. High among these are “opportunity costs.” The quality of any given option cannot be assessed in isolation from its alternatives. One of the “costs” of making a selection is losing the opportunities that a different option would have afforded. Thus, an opportunity cost of vacationing on the beach in Cape Cod might be missing the fabulous restaurants in the Napa Valley. If we assume that opportunity costs reduce the overall desirability of the most preferred choice, then the more alternatives there are, the deeper our sense of loss will be and the less satisfaction we will derive from our ultimate decision.
For early adopters of the iPhone who have paid the “early adopter tax”, their thoughts immediately turn to all the other things they could have spent that $200 on, all those other opportunities that got passed up.
If you haven’t read Paradox of Choice, definitely check it out, it’s full of fascinating insights.