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Apple not just refusing cash, also refusing Apple Gift Cards for iPhones
- Thread starter Dybbuk
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Yes...and?
Unfortunately, this has been covered by Apple:
How's that the point? What's next? Is Apple going to start badgering people that purchased an iPhone as to why it's not been activated on the AT&T network?
"Wow, John. You've had your iPhone for two months and according to our database the phone you purchased is not activated. Activate it now or you can't shop at our stores anymore."
This is ridiculous. There will be a rollback on this policy within a few months, you wait and see. Maybe they should just act like AT&T, and require a signed contract (right there in the store) when you purchase the iPhone. That would be more acceptable if they're just wanting to limit phones to people who activate them legitimately.
After all, that's how the rest of phone purchases that require a contract work.
The point, from how I read it, is designed to make it more inconvenient for people who buy iphones just to unlock and resell them.
If the same people are buying phones over and over wish cash you'd never know it.
With credit cards you'll either scare people into no longer doing it, or force them to leave a trail when they do.
What Apple will actually do with that paper trail is pure speculation, but I can certainly see them blacklisting people who buy more than a couple a month.
I'll take a shot, I love speculation, but before I do that we need to speculate about something else as a premise. So here are my 2 string theories: (1st ones solid, 2nd one needs help)
String theory 1:
A. It's possible that Apple as a company initially assumed that most (95%ish at least!) of iPhones sold would be used on the AT&T network. The accounting methods used to initially cost the product, and forecast revenue over 2 years all fit and are part of the $400 (or former $600) selling price.
B. One of the reasons Apple convinced AT&T to allow the selling of iPhones w/o activiation at point of purchase is to introduce this neat new easy way for consumer convenience. "Let the consumer go home and activate the phone via iTunes, it's going to revolutionary!". AT&T played along, willing to try new things and be open minded etc.
C. The convenience proved to be a success with 1 slight mishap. 250,000 + iPhone's weren't activated and are being unlocked relentlessly (oops, that's a pretty large ***** number Apple!, we should have required activation at the point of purchase?! or are you going put the worms back in the can? ). So, AT&T is upset because this works against the grain of their exclusivity and Apple is upset because it undermines their total net profit per iPhone over a 2 year schedule.
String theory 2:
Now that the premise is laid out and all is very true because I posted it
, comes the reason for the paper trail. It's not the legal action most people would probably assume; that Apple is going to knock on people's door's with court notices for not activating their iPhones, nope. That type of behavior does very little to solve future problems, it tarnishes Apple's image (makes them look like the RIAA on a witch hunt), and results in a costly method of chasing would be criminals to a result of zero profit, back to square one. It's possible Apple may be prepping for the next logical action (well at least what i would do) to derail, slow down, unlocking efforts. During the next phase of iPhone releases and or AT&T/Apple pricing promotions the consumer is charged a hefty price for the iPhone at the point of purchase. ( example numbers only so don't knock them
). Consumer uses a credit card, leaves name and address at the purchase point. pays $200 for the phone. Upon activation, consumer receives a $100 instant refund (incentive). So if the purchaser activates the phone via AT&T then the purchaser receives his refund. If it was bought as a gift (the accountability scape goat) , then the purchaser receives his refund only if the receiver of the gift activates it on the AT&T network.What this essentially would do is make the cost of purchasing an unlocked iPhone much much higher than the cost of the unit if activated via AT&T. All this without ruining Apple's price image it's so worried about. So you still can't "get an iPhone for a penny!, if you activate with AT&T" . you still have to pay $400 or w/e up front.
Now i'm sure string theory 2 is full of flaws, i really didn't spend to much time thinking about it so prod away, but they idea of it or something similar to this may be in the works. This incentive type deal won't work without being able to trace back an activation to the purchaser accurately thus it's a possible reason for the paper trail.
Apple should just go back to $599 and give those who activate on AT&T the $200 back. After all, technically 100% of iPhones are destined for AT&T activation under the current iPhone business model -- legit buyers would have nothing to worry about.
In fact, this probably should have been the price drop strategy all along.
At the AT&T stores, they could keep the $399 @ POS price but install an iTunes activation station at each location (or simply require in-store activation).
In fact, this probably should have been the price drop strategy all along.
At the AT&T stores, they could keep the $399 @ POS price but install an iTunes activation station at each location (or simply require in-store activation).
this crap is the reason I held off on the ipod for so long and now it's the reason I'm never buying a mac. Apple demands too much control from consumers. I think the iphone is cool but it isn't worth a crap contract with AT&T especially since that just about any other phone with just as many and more features can be used on any network.
This is such a myth (at least in the United States). When is the last time you used your Sprint phone on the Verizon network? Or your Alltel phone on the Sprint network? You can't because they are CDMA and LOCKED to a specific carrier.
The only phones that are even capable on other networks are GSM phones, and they can only be used on AT&T or T-Mobile (which is mostly the same network by the way). In the United States, people don't buy unlocked phones in the masses and that's not going to change anytime soon.
It does appear that in-store activation would be more consumer-friendly than refusing to accept cash or gift cards.
However, it will never happen. Apple is afraid that they will lose control of the activation process. By forcing customers to use iTunes, Apple can control the end-user experience.
As luck would have it, that's changing... at least with Sprint.
After a lawsuit, Sprint has agreed to unlock their phones:
http://www.iht.com/articles/2007/10/28/business/sprint.php
From lawsuits to Congressional hearings, there's beginning to be a general push to open up the USA market to more phone choice. We will all benefit.
Given how popular gift cards continue to become in terms of gifts, I really hope this comes back and bites Apple in the butt. They're starting to act like the RIAA in terms of implementing policies that only punish the people that aren't doing whatever they're trying to prevent.
Though it should be noted that even if you unlock your Sprint phone, you're still stuck with Sprint service in the US. Verizon, the other compatible network, refuses to allow you to use Sprint phones with their service.
True, will have to wait for the next lawsuit
Verizon just ended up agreeing to a settlement over their previous "unlimited data plan" that turned out not to be such.
Like I keep saying Attorneys General up here just love this kind of thing. Easy money for their state in fines, and they look good protecting the consumer.
That's interesting, but unless Verizon and Alltel are involved–who's network are we going to use our newly unlocked (after 2 year agreement) Sprint phone on?
We hope we will benefit. I have a feeling we are just going to end up paying more on the front end. Until all the wireless carriers switch to the same cell technology, unlocked phones will never reach their full potential. And the chances of that happening are slim to none.
I would say 100% of people that buy gift cards don't buy them for themselves, and 99% of those people never read the agreement and just assume that they can be used for anything in the store.
If I were to buy someone a GAP gift card, I would automatically assume that it could be applied to anything purchasable in the store. Which it can. The same is true for every other retailer I know, so why would I (or anyone else buying a gift card for someone) think that the same wouldn't be true for Apple?
I do understand where they are coming from, but this was not the solution and with holiday seasons coming up, I'm sure it will bite them in the butt some.
The only logical thing I can think of is that AT&T is behind it.
Why you ask... because it's easy to point blame at them.
Seriously though. I can't imagine Apple being this difficult without AT&T.
Why you ask... because it's easy to point blame at them.
Seriously though. I can't imagine Apple being this difficult without AT&T.
You never know. Vodafone and Verizon have been talking about moving to the same technology, and now this:
Verizon might switch
Obviously Apple has a huge incentive to keep these phones in the hands of AT&T subscribers, and with the current estimates of over $400 from AT&T to Apple per iPhone subscription than they have suffered a huge loss with the 250,000 phones that are not linked with iPhone subscriptions. Apple can try to keep the phones in the hands of AT&T customers by limiting resellers who may sell the phones in Canada or South America to be used on other networks.
So that brings me to the topic at hand, is Apple making a good business move in saying that they do not want people to pay with cash or their gift cards? I would think that it could be a bad move. The resellers can probably get the phones in the hands of AT&T customers and obviously the more phones they sell the more that will end up on the AT&T network. However, if they are going to forbid cash purchases they have to forbid the gift cards and if that puts some people out than I guess that is a risk they are willing to take.
I paid with my check card so not an issue for me and I am sure for the majority it isn't going to be an issue and if it gets to be a real issue perhaps they will revise the policy.
So that brings me to the topic at hand, is Apple making a good business move in saying that they do not want people to pay with cash or their gift cards? I would think that it could be a bad move. The resellers can probably get the phones in the hands of AT&T customers and obviously the more phones they sell the more that will end up on the AT&T network. However, if they are going to forbid cash purchases they have to forbid the gift cards and if that puts some people out than I guess that is a risk they are willing to take.
I paid with my check card so not an issue for me and I am sure for the majority it isn't going to be an issue and if it gets to be a real issue perhaps they will revise the policy.
For my birthday this past summer I had asked for Apple gift cards from everybody for an iPhone. Amazingly I got enough for the 8Gig. I decided to wait a bit to buy the phone though. On Friday I went to the Apple store near me and picked up Leopard and an iPhone (which was less than the phone alone would have been when I received the gift cards). Little did I know how lucky I was to have chosen that day to get the phone. I would be seriously pissed off now if I had not.
I paid cash for my iPhone on release day - if it had required a credit card, I wouldn't have minded; but I would have had to change my plans up alot. I don't know about everyone else but I have a 1500/day cap on my bank card and I'd already bought a digital camera earlier that morning.
Seems like a jackass move on a phone that sells like hotcakes in the 17 and under market, those who are least likely to have a credit card.
Seems like a jackass move on a phone that sells like hotcakes in the 17 and under market, those who are least likely to have a credit card.
Do we know if they'll accept a combination of gift card and credit card? Because if they do, it's not nearly as big of a deal.
I honestly have no idea. However, this policy has me quite ticked with Apple right now simply because Apple is trying to bully people. I won't tolerate any company that tries to bully, no matter how much I like their products
Well, policy aside, I hope for the sake of Apple and the iPhone product, that Apple:
1. releases this SDK by the beginning of February rather then by the End of February.
2. And also hope they really push to get this product to areas where the product isn't available as quickly as humanly possible.
Seems like every day/week that goes by, the more unlocking and hacking iPhone seems like the norm rather than the exception.
The incentive to unlock an iPhone in order to allow it to function in areas where it's not officially available is > then any silly written agreement Apple can cook up.
The incentive to create 3rd party wares that allow the iPhone to do things people want, which Apple didn't include in the box or at iTunes is > then any silly written agreement Apple can cook up.
1. releases this SDK by the beginning of February rather then by the End of February.
2. And also hope they really push to get this product to areas where the product isn't available as quickly as humanly possible.
Seems like every day/week that goes by, the more unlocking and hacking iPhone seems like the norm rather than the exception.
The incentive to unlock an iPhone in order to allow it to function in areas where it's not officially available is > then any silly written agreement Apple can cook up.
The incentive to create 3rd party wares that allow the iPhone to do things people want, which Apple didn't include in the box or at iTunes is > then any silly written agreement Apple can cook up.