Apple to Charge for 2.0 Update?

[abrooks]

During yesterdays conference call I picked up on something that made my ears prick up. I'm unsure whether I heard it correctly and I haven't had the time to go back and listen again, but check out the transcript of the bit I'm referring to.

2:43 PT - DM: Piper Jaffray: And we’re back to the iPhone revenue recognition delay.

2:43 PT - DM: Opp: Delay recognition of revenue and product cost of iPhone, but will continue to expense operating expenses on advertising, engineering, period costs, etc.

2:43 PT - DM: PJ: Charging for iPhone 2.0 for those who bought before March 6th?

2:44 PT - DM: Opp says it’s free.

2:44 PT - DM: PJ: Why deferring after March 6th if everybody gets it for free?

2:44 PT - DM: Opp: Customers presuming when they bought it that they’d get it for free. Proper accounting.

Is it me or is Oppenheimer suggesting that customers who bought after March 6th will be charged?

 

[edesignuk]

I thought it was pretty much a certainty that there will be a charge for 2.0, and everyone knew that already? (after the Touch update @ $20)

 

[Project]

no its free. Its an accounting treatment. Those people who bought an iPhone AFTER the SDK/v2 announcement in March would presume that they will be getting a lot more features for free in June. So they are buying it on the presumption that it would be upgraded. Apple will account for that by deferring the revenue they receive from all iPhones bought from March-June until June

 

[PowerFullMac]

Steve said himself that its free for iPhones bit there will be a charge for iPod Touches.

 

[goosnarrggh]

I thought it was pretty much a certainty that there will be a charge for 2.0, and everyone knew that already? (after the Touch update @ $20)

There's free, and then there's FREE.

Customers will not have an out-of-pocket expense specifically meant to pay for installing firmware 2.0. But Apple still has to account for it. And that money comes out of the income from ongoing revenue sharing service plans with Apple's authorized network operators.

Now, as for iPhone customers who are not using their iPhones in conjunction with a revenue-sharing service plan... IMO they should face the same upgrade fee (whatever it turns out to be) if they want to upgrade, as the iPod Touch users will.

 

[bigandy]

Steve said himself that its free for iPhones bit there will be a charge for iPod Touches.

Black and white, that's what he said at the iPhone SDK launch.

 

[joeshell383]

There's free, and then there's FREE.

Customers will not have an out-of-pocket expense specifically meant to pay for installing firmware 2.0. But Apple still has to account for it. And that money comes out of the income from ongoing revenue sharing service plans with Apple's authorized network operators.

Now, as for iPhone customers who are not using their iPhones in conjunction with a revenue-sharing service plan... IMO they should face the same upgrade fee (whatever it turns out to be) if they want to upgrade, as the iPod Touch users will.

No, no, no! The iPhone update is not free because of the carrier deals, it is free because of the way that Apple is accounting for the iPhone. The Apple TV is accounted for in the same way, which is why the ATV 2.0 update was free. The iPod touch is accounted for differently than ATV and iPhone, which is supposedly why they are charging for updates.

 

[wildcardd]

It probably has something to do with ActiveSync licensing. Since they have to presumably pay a fee for each unit sold. It is probably in the contract that they will begin paying a royalty fee for every unit sold after March 6 announcement.

The update will be free for iPhones, small fee for iPod Touch.