I am not sure what point you are trying to make.

I made an example to explain what would happen if consumers had a way to know, for sure, the quality of a product.

I didn't mean for you to take my example, try to find smartphone models that may match and then come back to me saying "your example is wrong because I can't find those models in real life". The whole point of my example was to share an idea, not to sell a smartphone.

The point is, for the example you have, the difference is not 20% and that price difference is important in the tradeoff. I agree with you, if people knew the quality was significantly better for +20% then they'd probably choose higher quality. But if the difference is 400% then no, lots of people aren't going to pick higher quality as it's out of their budget, period.

A BMW/Mercedes might be a more quality car than a Kia but someone that only has a budget for a Kia isn't going to even consider a BMW/Mercedes for 2x to 8x more.

On top of that "quality" is subjective. I might agree that a Macbook Air ($999) is better than a $300 window laptop (there's tons of them) but both the Kia and the $300 Windows laptop will serve people's needs. a Kia will get them to/from work. Let them transport their kids. Etc.. A window laptop will let them browse the net, view youtube, write a resume. It's not like the Kia and windows laptop are useless. Plus, for the laptop, they can get 3 of them for the price of 1 mac. So everyone in the family gets one. It's like buying a Vizio TV for every room instead of one Sony TV for one room.

> I agree with you, if people knew the quality was significantly better for +20% then they'd probably choose higher quality.

Right, we agree then. People do care about quality. That was my point.

> A Motorola Moto G Play is $110 no contract. The cheapest iPhone is $429. It's is not 20% more, it's 4x more.

But this is the market failure.

If you ask a normal person why they should care about having a phone with drivers in the mainline kernel tree, they don't even know what you're asking. But the answer is, because then it can keep running the latest version of stock Android indefinitely, instead of being forced to buy a new phone over and over.

At which point a 20% difference in the hardware price will be relevant, because if you want to keep the phone a long time you'll want the one with 16GB of RAM instead of 4GB -- which is fine because RAM is under $1/GB.

But since the average phone customer doesn't know this, the phone they want isn't even available and their choices are the cheap phone which will be out of support in less than a year or the one that costs four times as much up front and will still be out of support before they otherwise actually need a new phone.

A "normal person" is a Starbucks barista making $38k/year (roughly 2000 hours at $19/hour).

That person doesn't spend 3 days' wages for "mainline kernel drivers" -- either they buy the iPhone because it's a status symbol, or they use the Android OS that shipped with the device for three years until the screen is cracked and the battery stops charging. To them security patches are just an inconvenience.

I don't think "if only people had the right information they'd spend money on the right things" is the right thesis -- I think it's more "why is everyone so poor? how do we make it so that more people can afford our wares?"

My impression (citation needed) is that globally folks have been worse off the last few years and so the median Android device spec was actually going down.

> either they buy the iPhone because it's a status symbol, or they use the Android OS that shipped with the device for three years until the screen is cracked and the battery stops charging.

That's also exactly the point. Why is it hard or expensive to repair the device? Would they have purposely chosen a phone they have to throw away like trash and then pay more than a hundred dollars for a new one if they could get one where a new battery is $15 and can be replaced like they do the batteries in their TV remote?

> My impression (citation needed) is that globally folks have been worse off the last few years and so the median Android device spec was actually going down.

Or people have realized that they only use their phone for maps and texting and they don't need a flagship if they're just going to throw it in the trash in two years anyway.

Because repairability has tradeoffs

The biggest tradeoff being that customers don't have to buy a new phone as soon.

> the median Android device spec was actually going down.

What is so great about the top end phone that I should get one? They all have cameras (plural) with more pixels than I can see. They all have a fair amount of storage.... Sure the top end models have more of everything, but is there anything that I as a user would notice?

I was one of the first to have an Android back when the G1 came out - the hardware was lacking, but any phone from 4 years later was good enough (except none had a slide out keyboard that was so much nicer than touch screens)

It's not a "failure" - people don't owe you to behave in ways that are approved by you. They have different priorities, and you can tell them they "actually" need something else until you blue in the face, but they'll buy what they want, even after your disapproval.

Having different priorities is not the same as having different (i.e. less) information. In one case they just want something different, in the other they're not getting what they want because the sellers are taking advantage of an information asymmetry to screw them.

What kind of information do you think would allow you to make the market of the phones substantially different than it is now?

If you think the problem is information, the sales of iPhones is about $200 billion per year. I am pretty sure that whatever is the information you are thinking about, it is possible to deliver it to the vast majority of the customer base for the small fraction of this sum. Which would allow to capture if not the whole market, than the significant portion of it - billions-sized portion. Why do you think nobody thought about doing it before you?

Lots of people thought about doing it.

The problem is this: What people want is existing phones with some minor alterations that make them last longer and be easier to repair, which wouldn't significantly affect the manufacturing cost but would reduce future sales across the industry, because many people could buy a phone and be good for ten years. So the large incumbents like Apple and Samsung don't even offer this, because they have such high market share that losing industry-wide future sales costs them more than making more current sales, and also they have such high market share that they were already the ones getting the current sales.

Then we would expect some smaller company to come by and eat their lunch, right? And you get ones like Fairphone and Librem that make the attempt, but those aren't just "Samsung Galaxy with a removable battery and open source drivers" because Samsung also won't sell you 95% of their existing phone wholesale and let you make those couple of changes people want. So they're stuck designing an entire phone instead of making a couple of changes to an existing phone, which is a heavy lift for a small company, and then the other aspects of the phone aren't competitive, or the price isn't. It's possible that someone will eventually get this right, but that doesn't mean that it's easy, and in the meantime the large incumbents are screwing everyone because the market is insufficiently competitive.

Lots of people thought about doing lots of things. Thinking about doing it and actually successfully doing it are two very, very different things, as any startup entrepreneur can tell you.

> So they're stuck designing an entire phone instead of making a couple of changes to an existing phone, which is a heavy lift for a small company,

Why a big company doesn't do it then? I mean, there are a lot of big companies not having a phone, and a bunch of big companies that used to have a phone and now don't. You'd think they'd do the easy thing and just add the extra 5% and eat Apple's lunch - but somehow they don't. Maybe that lunch is not as easily eatable as you think it is.

> You'd think they'd do the easy thing and just add the extra 5% and eat Apple's lunch - but somehow they don't.

Because the market failure is the size of the companies in the market. If you're big enough to sink the resources to make a competitive phone from scratch then you're expecting to capture a large chunk of the market, in which case you'll behave like a large incumbent with the incentive to sell disposable phones.

To avoid this you need to bust up the vertical integration that makes it hard for small companies to make a competitive phone so that it's possible for a small company to make a device which is overall competitive while they're still hungry enough for market share to give customers what they want.

If you say "people" want something else than what is offered now, then by providing this something else you should be able to capture a lot of the market. Example: Apple produced an iphone, but some people wanted more open, not-so-closed-garden, customizable, moddable phone. And they wanted an OS to go with it. And here it it, Android and a booming Android phone market. Yes, a giant - Google - owns the OS. But another giant - which are many around - could dislodge them if they slept at the wheel.

Another example: Microsoft owned the browser market with their Explorer. Then they fell asleep at the wheel and now Chrome owns the market. Sure, again, it took Google to do it, but it can be done. And it will be done again - when there is a substantial unsatisfied market need.

If this is not happening for a long time, then I think it's time to consider the possibility that it's not that the "market" "fails", but just your ideas about what people should want are not the same as what people actually want. If nobody buys the "ideal" phone somebody built - maybe it's not actually ideal for enough people.

> If you say "people" want something else than what is offered now, then by providing this something else you should be able to capture a lot of the market.

Suppose you could capture a lot of the market in the sense that the installed base of people using your phones goes from 25% to 40%, but then your repeat customer interval goes from an average of 3 years to 9 years. Your future sales outlook would be down. You're not going to do it.

Now suppose that your existing installed base is below 1%, or you're a new company and it's zero, and by doing this you could capture even 3% of the market. Then you do have the incentive to do it, as long as that percentage of the market can recover your R&D for developing a competitive phone to begin with. But what happens if the existing market is vertically integrated, so you have to do a lot of unrelated work from scratch instead of starting with a competitive reference design? Then your R&D costs are much higher and you don't do it.

And then nobody is making the competitive phone that people want.

> If nobody buys the "ideal" phone somebody built - maybe it's not actually ideal for enough people.

Let's pick some random midrange device; Samsung A35. It's ~$265, has 8 cores at >2GHz, 8GB RAM, 128GB storage, 2k display, etc. All I want is that with a removable battery and the ability to run a mainline Linux kernel. These are similar specs to the Fairphone 5, which doesn't yet appear to run a mainline linux kernel (they're working on it), but that's $800. Even at that price they're selling them, but which phone is the open competitor in the A35's price range? Can you identify anyone offering this device?

You can't say the market doesn't want something the market isn't offered.

The vertical integration is why the $110 phone exists in the first place…

If you arbitarily move the pricing bar then of course there may be more competitive small companies, relative to the new baseline.

> The vertical integration is why the $110 phone exists in the first place…

There is no evidence of that. If anything more vertically integrated devices (e.g. iPhone, Samsung flagships) cost more, because a vertically integrated market increases barriers to entry and impairs competition.

A Samsung phone might very well have a Samsung CPU with Samsung RAM and Samsung flash made in Samsung fabs with a Samsung battery and a Samsung screen. Galaxy S24 Ultra, ~$1000.

Meanwhile, the $110 phone was the Moto G Play. That's a Qualcomm CPU with Samsung RAM, a "Motorola"-branded battery which is probably Sanyo or Panasonic, and a third party screen and flash because Motorola doesn't make those either. It's $110 because it's full of fungible commodity parts.

The issue is, some of them -- especially that CPU -- are poorly documented and full of tightly integrated but closed source firmware/drivers. Which has nothing to do with the manufacturing cost of the hardware. A fully-documented open-source RISC-V CPU is not going to cost more.

“No evidence”… according to who?

Based on what arguments that such evidence does not exist?

The phones market is completely distorted by several kinds of anti-competitive and purposeful social-engineering forces.

For a start, it's not a given that the Moto G Play has a lower quality than the iPhone. If the market was competitive, there would be comparable alternatives on every dimension, but it isn't, and those can't be compared.

> For $15/month savings her child will be ostracized at school because of the blue message box

FWIW I have teenage kids, and nothing like this has ever happened in their lives.

It seems to me like you are an expert on rationalizing expensive purchases. If that's unconscious, I think it would be good for you to bring it to conscious awareness.

While I disagree with your first paragraph, the other two are spot on. When comparing prices of tech products, people focus too much on the percentage difference, while the dollar difference is not that significant. Depending on the person making the purchase. Anybody who can afford a car could easily afford the most expensive smart phone for sale.

> Anybody who can afford a car could easily afford the most expensive smart phone for sale.

This is ignoring that many people “afford” these purchases on credit.

To answer this question properly she would have to use both and then make a judgement, no?