What’s something worth?

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My iPhone X retails for $1,000 at the Apple store. That’s a lot. It’s one of the most expensive mobile phones on the market and it could be argued it’s at the top of the expense heap. And yet, if that were a high-end DAC or power amplifier it would be on the extreme low end. And, what’s tough about that equation is the level of technology and parts in an iPhone is a magnitude more expensive and sophisticated than any DAC.

Now, it should be noted that millions of iPhones are manufactured each year compared to thousands of DACs. Economies of scale certainly play a big role in pricing. That said, the chasm between an expensive DAC and a technological wonder like the iPhone cannot be explained entirely by scale.

Pricing strategies have a myriad of formula. Some are priced according to marketplace expectations, some a fixed formula of parts and labor. Still others are boastful of being the most expensive, or the cheapest.

When I judge value I look at a lot of factors: importance of the product to me, other models in the market, need, scarcity or abundance, the company story and its founder’s philosophies.

What a product is worth is up to each buyer and its value to them, not what’s necessarily fair or equitable to charge.