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Apple Store No Longer Sells iPhone With 2-Year Contract on AT&T
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HobeSoundDarryl
macrumors G5
I feel like goal posts keep moving here.
I originally replied to a different guy because he appeared to be worried that this move would hurt AT&T's business. I don't see how it hurts AT&T as it looks like it will help them sell more phones.
You replied to my reply about how this could be bad for unlimited plan owners. I replied that I don't see that either since unlimited people can still buy new iPhones for cash or creative financing if they need monthly payments and preserve their unlimited deals.
Now you reply that this may drive traffic from Apple stores to AT&T stores and that accessory profits may be lost by Apple. First, I'm not sure Apple gives a hoot whether an iPhone is purchased at AT&T or Apple as they are going to get paid in full for that phone either way. There's probably some accounting math that shows that unit sales of iPhones sold and serviced by salespeople paid by other companies is more profitable than paying Apple employees for the same amount of selling & service time.
Second, there may be some merit to the concern about accessory sales. But it seems those accessories are going to be sold anyway. Every time I've been in an AT&T store, I've never personally noticed them stocking much in the way of accessories for iPhone. They probably do have some such stock but I haven't noticed. So yes, I suppose if an AT&T store happens to stock an iPhone accessory that a consumer wants to buy when they buy their new iPhone, they may buy it from AT&T, robbing Apple of the profits from getting to sell that accessory direct. But I'm sure Apple will be fine. For ever incarnation of that scenario playing out, there are probably at least the same number of scenarios of AT&T salespeople doing all of the showing work for consumers who then go to an Apple store (physical or online) to actually buy their new iPhone and any iPhone accessories.
Don't worry so much about Apple profitability. They are doing very well. VERY, VERY, VERY well. If AT&T accessory sales was a big threat to Apple profitability, Apple could stop/slow supply of new iPhones through the AT&T store channel.
Can anyone try to purchase an iPhone that is currently on unlimited data and that would be eligible for a 2 year contract renewal? Maybe this can shed some light on it if you can purchase at full retail price or it defaults to the Next program regardless if you want it or not.
Don't know why anyone is surprised. AT&T (and Verizon) stated back in 2013 that they would be watching how consumers responded to T-Mobile dropping subsidies and would follow suit if successful.
Looks like it is. The U.S. Cellular industry is moving forward and subsidies will soon be a memory. Expect Verizon to remove them in the near future as well.
Looks like it is. The U.S. Cellular industry is moving forward and subsidies will soon be a memory. Expect Verizon to remove them in the near future as well.
If you read the whole article I posted, it included people who pay for the phone... it's $400 more with Next than on a 2 year contract. And as for unlimited data users - it's not a small number of their customers - it's half. (http://time.com/money/3546472/att-unlimited-cellphone-plan-ftc/)
My understanding from an AT&T rep is subsidized phones ($199/$299) etc are no longer available at all even for customers coming off the two year contract or adding a line. You must go into the new plan.
Let's just be honest here, ATT will do just fine with this new plan. People who visits Macrmors are mostly tech people which is probably a sub-sub group. This group of people is well informed and they know how to navigate the mobile world. On the other hand, given that most people are so used to monthly payment, they will eat this up like everything else. I have known many people who can walk into a car dealership and walk out with a new car and a new $250 monthly payment in under an hour, or buying electronics from Best Buy when they don't have the money but they can still "afford it" because of the monthly payment plan. So I don't think they will think much even if they have to put in another monthly payment for the phone.
Personally I feel that cellphone function/technology have plateaued, most of the functions are more or less software related. I have yet to see any real innovation coming from mobile companies over the last several years (e.g., they can easily throw millions at a R&D group and come up with next generation battery, or promote wireless charging). Not saying that the iPhone is not great, but I feel that the desire to need a new phone or even upgrading every two years is a bit of a waste these days. I recently purchased a Moto E as a toy for $50, the device is a bit rough around the edge but for the price I can deal with it. I guess I'm just not sure if it's a wise idea to keep buying these $700+ cellphones.
Personally I feel that cellphone function/technology have plateaued, most of the functions are more or less software related. I have yet to see any real innovation coming from mobile companies over the last several years (e.g., they can easily throw millions at a R&D group and come up with next generation battery, or promote wireless charging). Not saying that the iPhone is not great, but I feel that the desire to need a new phone or even upgrading every two years is a bit of a waste these days. I recently purchased a Moto E as a toy for $50, the device is a bit rough around the edge but for the price I can deal with it. I guess I'm just not sure if it's a wise idea to keep buying these $700+ cellphones.
Windows 8 ain't so bad. I appreciate your efforts to throw in some Microsoft hate though.
FWIW- I've had an AT&T family plan with 4 iPhones for over 5 years. We've got a corp discount so my numbers will vary from yours, but here's my observation. Before Next we paid about $250 per month(we've got a high data plan). When Next rolled out my bill went down to about $180. Then, I upgraded one of our iPhones because it's 2 years was up. I got the discounted pricing ($199) but my plan went back up by $25 to $205. Now, 2 more of my phones are ready for upgrade and AT&T is pushing me to do the monthly Next pricing on them (0 down, $28 per month for iPhone 6+ 64gb). I should also mention that about a year ago AT&T voluntarily doubled the size of my data plan and added rollover. In summary, over the course of about the last 2 years my AT&T bill has gone up about 10%, but they voluntarily doubled my data plan and added rollover AND my phone financing is now on the more transparent Next payment model. Honestly, I'm not terribly upset about any of that.
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HobeSoundDarryl
macrumors G5
How does this change that opportunity to sell the iPhone instead of trading it in? And here, instead of $99 or $199, your upfront cost is $0. So if you can use it for 2 years and sell it for $99 or $199, that seems better than paying $99 or $199 now and selling it in 2 years for $99 or $199.
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So much FUD.
1. AT&T is not pushing anyone out of a legacy plan.
2. Apple makes and prices the iPhone. Yet, people are mad at the carriers because of the cost of the iPhone. What!? Literally, why?
Do you want to know the price difference between a subsidized legacy plan and the new plans without the cost of the phone? The cost of the phone. Do you REALLY think anyone was giving you an iPhone for $200?
It pains me to see people so adverse to logical analysis of a given scenario, because truth be told, the price of equipment has gotten cheaper for OEMs yet more costly in the market for consumers. For some reason people feel that their carriers should foot that bill while simultaneously lowering the cost of service. Do you get mad at the gas station because of how much your car costs? Hell, does the gas station give you a 0% APR loan for your car with $0 down at signing? LOL!
Putting pressure on OEMs to lower device costs is the potential outcome of all of this, yet everyone turns their sword against the service providers because they are giving the consumer more options and making transparent just how much money your giving to Apple, Samsung, LG, HTC, etc each month in the form of a premium on your wireless bill. Why aren't the masses questioning the OEMs about the cost/value paradigm? Huh?
Just make it make sense.
1. AT&T is not pushing anyone out of a legacy plan.
2. Apple makes and prices the iPhone. Yet, people are mad at the carriers because of the cost of the iPhone. What!? Literally, why?
Do you want to know the price difference between a subsidized legacy plan and the new plans without the cost of the phone? The cost of the phone. Do you REALLY think anyone was giving you an iPhone for $200?
It pains me to see people so adverse to logical analysis of a given scenario, because truth be told, the price of equipment has gotten cheaper for OEMs yet more costly in the market for consumers. For some reason people feel that their carriers should foot that bill while simultaneously lowering the cost of service. Do you get mad at the gas station because of how much your car costs? Hell, does the gas station give you a 0% APR loan for your car with $0 down at signing? LOL!
Putting pressure on OEMs to lower device costs is the potential outcome of all of this, yet everyone turns their sword against the service providers because they are giving the consumer more options and making transparent just how much money your giving to Apple, Samsung, LG, HTC, etc each month in the form of a premium on your wireless bill. Why aren't the masses questioning the OEMs about the cost/value paradigm? Huh?
Just make it make sense.
Wow... you're right. I just did the math for an individual 3GB plan at ATT (which is what I'll be switching to).
No contract:
$65 a month x 24 months = $1,560
Full price of iPhone 6 (16GB) = $650
Total = $2,210
2-year contact:
$80 a month x 24 months = $1,920
Subsidized price of iPhone 6 (16GB) = $200
Total = $2,120
That's $90 in savings... now it makes sense why they'd want to phase out the contracts.
Well hopefully this will make it easier for the people who purchase the phone outright without contract...nice
Every time I look at these posts or read about all of these plans, I just get the biggest headache. Life is too short to sit here and discuss all this needless unnecessary complexity all the time.
I've been using Ting for over a year now and I usually pay $19 a month. Boom. Done. I never think about any of this crap, and my life is infinitely better for it. And I'm sure yours would be too.
I've been using Ting for over a year now and I usually pay $19 a month. Boom. Done. I never think about any of this crap, and my life is infinitely better for it. And I'm sure yours would be too.
You linked to a 2 year old article written before AT&T announced the mobile share plans which are significantly cheaper than the old plans to compensate for the fact that there's no device subsidy.
Next is NOT leasing.
Next is simply a 0% APR finance contract that spreads the price of the phone over a certain number of months. You own the phone the entire time.
The ONLY time you are required to turn your phone back in is if you want a new phone BEFORE you've completely paid off your previous phone. That is 100% optional and controlled entirely by you.
FWIW, here's a Next contract:
I just wonder how this is going to affect people in line who have their contracts up and want to re-up in September when the new model arrives. People in the know will understand it's not possible to get a new contract, but some will be told otherwise while there. I can see many disappointed people trying to get a 2 year contract.
The cost of the phone is factored into your service plan. Someone said the calculated cost is $20 a month.
What I am complaining about is how complicated and non transparent this process now is.
For example, after two years of paying on Next, some are claiming that you don't even own the phone and must turn it in unless you pay a few more installments. Is this clearly spelled out or is it hidden in fine text?
I edited my previous post to explain my argument by adding some numbers. I'll repost them here.
For a 10GB plan and 16GB iPhone 6. Both cost $100 per month base.
2-year contract: $200 upfront and $40 per month for 24 months. Total:1160
Next: $0 upfront and $15 per month for 24 months. You must pay for your phone in 24 equal installments of $650/24. Total: 1010.
The next plan is $150 cheaper.
But key is not to trade-in your phone for the upgrade. If you want to upgrade, sell the phone on the private market and then upgrade. Where am I wrong?
It's not worse. Some people just REALLY want to hang on to that unlimited plan, but since they start to throttle at 5GB, I fail to see the point.
I dropped ours last year and went to a huge shared data plan (40GB a month) when they had their special where you could get double the data (my rate is the same rate they currently offer for 20GB per month).
We have 10 lines on one plan. Ours (5 of us), the inlaws plus husband's grandmom, and my mom and grandmom. His parents and mine pay for their share, so we actually wound up saving money and we never run out of data, using them however we like. And tethering without a jailbreak!
People just got used to a phone costing 199 on a 2-year and lost sight of the fact that the rest of the cost of that phone was being paid every month in their bill and would KEEP being paid every month in their bill, long after the phone was actually paid off. AT&T made a fortune off those plans, really. I think they're ditching them now because they don't want to deal with unlimited data and these new plans make the transaction far more transparent.
Plus, people can upgrade pretty much whenever they want.
yg17, half of AT&T's customers still have unlimited data (http://time.com/money/3546472/att-unlimited-cellphone-plan-ftc/) for us the article is still true. If you're on the mobile share plan than it will be cheaper, but for half of us (and the majority of MR readers) it is not.
If one just pays cash for their phone, they can avoid the whole mess, really. It might sting the first year, but if you plan it properly, you can pay cash for your phone and sell your old phone every year to recoup it, so it's not really a bad deal at all.