Hidden expenses lurking in shadow of new iPhone
SAN JOSE, Calif. (KGO) -- Apple fans can start to pre-order the new iPhone 5 online starting at midnight, but there's a hidden cost that consumers will be paying to have Apple's latest device.
Analysts are predicting Apple will make an extra $100 million just because it changed two things on the new iPhone 5 -- the larger screen and the dock connector. That means after shelling out from $199 to $399 for the phone, you'll also have to get a new case and probably some new cables.
Apple is no doubt excited how its larger screen is playing to iPhone fans and how it's replacing a clunky 30-pin dock connector with a tiny one called "Lightning." But that means users will either need a $30 adapter to connect it to an older dock or they will have to buy new cables.
The changes Apple made for the iPhone 5 already have accessory makers scrambling. They learned the details Wednesday and want to have new items ready when the iPhone 5 comes out at the end of next week.
Zagg makes iFrogz cases and invisible shield protective film for the iPhone's screen.
"That tiny fraction of size that consumers may not think about, it means that people like us, we start all over from scratch," Zagg Product Development Vice President Ben Godfrey said. "It's brand new tooling. It's new molds. It's complete new production, new packaging, a massive effort to support what customers want."
By some estimates, a typical iPhone 5 buyer will end up spending $50-$100 on accessories. Accessory suppliers make an estimated $2 billion a year for Apple devices.
"It's only money, and you're already shelling out a ton of money for the iPhone 5, so I'm not sure consumers will notice; but I think a lot of the more obsessive mobile geeks like myself will find it to be a bit irritating," Palo Alto resident Ryan Staatz said.
Apple, along with wireless carriers like AT&T and Verizon are gearing up for pre-orders online starting at midnight. The hope is to avoid long lines when the new iPhone is released a week from Friday.
"A lot of people like that culture -- get there early, some of them sleep out overnight, but absolutely, the easiest way to get one is to go online tonight and order, and you'll have it on the first day," AT&T spokesperson John Britton said.
You can just imagine cargo jets from China to the U.S. will be filled with a lot of iPhones and accessories over the next few days to have products ready for sale and distribution a week from now.
apple, iphone, business, david louie
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