September 23, 2013
Apple Incorporation unveiled the long-awaited iPhone 5s and 5c to diverse investigations and criticism. The industry for high-tech smart phones is a perfect example of monopolistic effective market structure. However, a business proposal will be designed explaining briefly about iPhone the market structure. Additionally, this proposal will include iPhones’ elasticity demand. Subsequently, the business proposal will explain how pricing is related to elasticity supplied of iPhones, changes in the quantity supplied as result of pricing decisions affecting marginal cost and marginal revenue. Last, besides pricing this proposal will include what are the suggested pricing can be applied, together with non-pricing strategies included to increase barriers to entry. Finally, the proposal will explain how could these changes in business operations may alter mix of fixed and variable costs in line strategy.
The Apple Inc. market structure consists of a large number of customers and retail sellers. In fact, each retail seller has certain monopolistic power marketing Apple’s high-tech products. "Retail structure may be changing dramatically due to the diversified retail formats, increased size of retail stores, new technological developments, and the changes in consumer behaviors. It is important to understand these changes. If we can understand these changes better, we will know what is happening in retail and further we can predict what will happen in this business sector" (Xu, 2007). Therefore, Apple is considered a mixture of monopolistic and effective competitive market selling iPhones. The principal characteristics of Apple market structure is described as follows:
In a competitive market Apple has to sell iPhones, which are most likely similar in features but not identical to major competitors such as Blackberry, Android, HTC one, Samsung- Galaxy, and so forth.