As most of you know by now, Russia has begun investigating Apple for price fixing of its iPhone 6 and 6S. My first inclination was to be sympathetic with them over this, since I always thought of the iPhone the same way. You can go to any number of retailers and the price is always pretty close. Apple can give us the 100 business excuses for this, but it is still price-fixing to a consumer. It isn't like gasoline where stations can vary a little from place to place. But that kind of brings up my point.
Retail is a business that is cutthroat as any in the world. So, if an iPhone 6 costs $730 in China, where they are made by the way, and less in the U.S then something is wrong with the consumer pricing model, or other factors are entering in. Price-fixing is rampant, and even Russia participates in it on occasion. They are not in OPEC, but they certainly fix their oil price on the market mostly created by OPEC. That is price-fixing in the same way that Apple is doing it. It doesn't make me feel any better to know that gas, razor blades, toothpaste, and a host of other things all rely on consistent pricing on a regional basis. There is no such thing as margin for most of these goods. The price is fixed; the margin is fixed.
The other factors entering in are tariffs and taxes that vary from one country to another. That is why a Chinese iPhone 6 from down the street costs more than one shipped from China to the US and sold. The Russian oligarchs may be another. Apple distribution is done largely through MegaFon, the second largest telecom there. The largest shareholder in that company is Alisher Usamanov, Russia's richest man and a Friend of Putin. If there was really anything going on with Apple, you would think Mr. Putin could just call him up and work things out. The fact that he doesn't is more of a reflection on the relationship between the two, than on Apple and its iPhone.
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