802.11n Upgrade Fee Confirmed at $1.99

MacRumors

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Original poster
Apr 12, 2001
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Apple spokesperson Lynn Fox has confirmed to News.com that Apple will be charging an upgrade fee in the amount of $1.99 for Core 2 Duo iMac, MacBook, MacBook Pro, and Mac Pro users who have 802.11n capable chipsets. Users who purchase an Airport Extreme base station will not have to pay for the upgrade.

An Apple service document obtained by MacRumors had previously indicated that the fee would be $4.99, however Apple may have decided to cut the cost in reaction to strong negative reaction to the fee.Apple said it is required under generally accepted accounting principles to charge customers for the software upgrade. "The nominal distribution fee for the 802.11n software is required in order for Apple to comply with generally accepted accounting principles for revenue recognition, which generally require that we charge for significant feature enhancements, such as 802.11n, when added to previously purchased products," Fox said in a statement.
The explanation for the fee is reminiscent of an explanation previously given to iLounge. However, the explanation does not fit well with many of Apple's previous practices. For example, in May Apple updated iWeb to version 1.1 which added a host of commonly-requested features at no charge.

Article Link: 802.11n Upgrade Fee Confirmed at $1.99
 

bigandy

macrumors G3
Apr 30, 2004
8,855
0
Murka
Translation: "We must make more money off of loyal customers."
Macrumors said:
Apple said it is required under generally accepted accounting principles to charge customers for the software upgrade. "The nominal distribution fee for the 802.11n software is required in order for Apple to comply with generally accepted accounting principles for revenue recognition, which generally require that we charge for significant feature enhancements, such as 802.11n, when added to previously purchased products," Fox said in a statement.
is there some problem here? i think your statement is a bit out of hand. $1.99 isn't exactly much worth complaining about.
 

SpaceMagic

macrumors 68000
Oct 26, 2003
1,740
0
Cardiff, Wales
I agree with Apple. $1.99 is a nominal fee and thus only counts as in accounting purposes. As they'll be selling Airport Extreme 'n' cards now as a separate product, there must be some make up for the loss that 'g' cards have suddenly transformed into 'n' cards. It's complicated but kinda makes sense to me.

Who cares anyway! I'd rather pay £1 than go buy a new airport express card. Thanks Apple I say.
 

WildCowboy

Administrator/Editor
Staff member
Jan 20, 2005
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The explanation for the fee is reminiscent of an explanation previously given to iLounge. However, the explanation does not fit well with many of Apple's previous practices. For example, in May Apple updated iWeb to version 1.1 which added a host of commonly-requested features at no charge.
This is a different situation though...Apple is enabling an hardware feature that was present, but disabled and unadvertised at the time the customer originally purchased the machine. $1.99 is not a big amount, and it will obviously cost Apple some money to process these transactions, so I'm sure it's something they'd rather have avoided if they felt they could.
 

swingerofbirch

macrumors 68040
All software enables hardware to perform various functions. I don't understand this.

Is this Apple being super careful because of their corporate scandal?

I can download shareware programs that use the built in temperature monitors in my computer and use software to display the temperature on the screen. Are the companies who enable the use of this piece of hardware without requiring a charge breaking the law????????
 

smueboy

macrumors 6502a
Oct 30, 2006
780
1
Oz
Why didn't they just enable 802.11n in C2D computers from the get go, and advertise as such? Or would that have detracted from the later release of 802.11n compatible Airports?
 

rjfiske

macrumors regular
Dec 8, 2003
117
0
Washington State
oh good grief, are we now complaining because Apple is charging the price of a couple of iTunes songs simply because it has to? This isn't a money-making scheme. This isn't a screw-job to loyal customers.

It's a compliance issue. If it was anything other than this, the fee would still be imposed (because again it has to) but it wouldn't be $1.99, it'd be higher. Don't forget if you have one of these 802.11n capable machines, the fee is NOT so you can use it as you are now. The fee isn't to give you functionality that existed when you purchased your machine under previous pretenses. It's to give you the abililty to use it in a NEW, better, faster (albeit unadvertised) way. You are losing nothing by not paying the fee. You are gaining something by paying the fee. I don't see the problem.
 

nbs2

macrumors 68030
Mar 31, 2004
2,713
485
A geographical oddity
Is this Apple being super careful because of their corporate scandal?
I wouldn't be surprised if this is what it is, coupled with an attorney that is concerned with making sure that Apple complies with the letter of the law, even if the spirit is undermined. After all, as long as you comply with the letter, you're untouchable.
 

patrick0brien

macrumors 68040
Oct 24, 2002
3,238
0
The West Loop
-All

This has to do with the gulf of having a feature installed, but not complete yet - e.g. the 802.11n spec is still in draft - so Apple has not enabled it yet. However, when the draft is certified, then enabling is possible. However, due to Sarbanes Oxley interaction with GAAP, Apple must charge due to the 'new feature' preinstalled in the machine.

Would we all rather Apple stick with 802.11 a/b/g and we suddenly can have our 3 month old machines not play with 802.11n? Can you imagine the yells of Obsolete in only three months from we Mac users?

This isn't the first time Apple has pre-built-in a feature before the draft was ratified - remember 802.11g?

The difference is now we have SOX - and Uncle Steve doesn't want to go to jail.

Blame Jeffrey Skilling, Ken Lay, and Bernie Ebbers for this sillyness.
 

EagerDragon

macrumors 68020
Jun 27, 2006
2,098
0
MA, USA
You that poor?

You are getting 2 to 5 times the speed for a minor price of $1.99 or $4.99 (which ever is correct).

Who cares, look at the Return On Investment (ROI for you).

Believe me it is not going to add that much to Apple's bottom line, but it is going to add huge speed increases to your networking.
 

darwen

macrumors 6502a
Apr 12, 2005
668
12
California, US
is there some problem here? i think your statement is a bit out of hand. $1.99 isn't exactly much worth complaining about.
I have a MacBook that is pre-'n' upgrade. I would gladly pay $2 for the upgrade. I agree, I dont see what the problem is. So apple is charging $2 to use the functionality your computer has. As far as I can remember, they were not advertising it had the 'n' when it was purchased. What's the problem?
 

guez

macrumors member
Oct 8, 2004
64
0
Let me get this clear...

I agree with Apple. $1.99 is a nominal fee and thus only counts as in accounting purposes. As they'll be selling Airport Extreme 'n' cards now as a separate product, there must be some make up for the loss that 'g' cards have suddenly transformed into 'n' cards. It's complicated but kinda makes sense to me.
So wait: you're telling me that for accounting purposes, Apple has to charge something for the upgrade, but that it doesn't matter what they charge? This seems like an invitation to wacky accounting. Imagine if a corporation said: "Yes, our CEO received a house in Malibu, but we SOLD it to him for 1 cent."

I have a hard time believing that this is way things work...
 

revman

macrumors newbie
Jan 18, 2007
17
3
Just GAAP

Just GAAP accounting. If Apple includes hardware features that can easily be identified (e.g. n chips) and then provide a free driver upgrade at a later date, the implication is an "unspecified" software upgrade. Since this would have no standalone value then ALL revenue form the sale would have to be deferred until this was delivered to the customer. (In reality it is more tricky than this).

By charging $1.99 they estabish the value for it, which is really smart. My Oppenheimer has some clever guys on the team!

Web 1.0 to Web 1.1 is not comparable since the features of 1.1 were never released and so no implication was made.

This has been around for about 7 years, and SOX makes it much more visible
 

pale9

macrumors regular
how does that make sense?

I agree with Apple. $1.99 is a nominal fee and thus only counts as in accounting purposes. As they'll be selling Airport Extreme 'n' cards now as a separate product, there must be some make up for the loss that 'g' cards have suddenly transformed into 'n' cards. It's complicated but kinda makes sense to me.

Who cares anyway! I'd rather pay £1 than go buy a new airport express card. Thanks Apple I say.
why charge anything for a simple firmware update!? i have tons of gadgets that get firmware updates that dont cost a cent, AND add functionality! apple is starting to nickel and dime us and i dont like it one bit. has success gone to their heads? hope not.

seems like many here agree with ANYTHING apple does and find reasons, even stupid ones, to justify the company's actions. sure, its just for accounting purposes, 1.99 is nothing, its adding value, apple is right in charging, ....
 

patrick0brien

macrumors 68040
Oct 24, 2002
3,238
0
The West Loop
I have a hard time believing that this is way things work...
-guez

It is, unfortunately. However to understand the intricacies of why, and expecially, how much per sold unit would require Ph.D's MBA's and a slew of gov't lawyer types.

It's one of those things it's less painful to just do it and make it go away.

Trust me.