AT&T iPhone 3G $199/$299 Pricing Policy

[LoganT]

Actually, Jobs left an opening: he said this would be the price in "almost" every country in which the phone is released. Of course the U.S., home to Apple, would be the exception. It's how we do business!

Well yeah but most people probably assumed (as normal people would) that they were talking about some country that no one has heard of.

 

[supmango]

I have been talking to people at AT&T and no one will give me any information. I keep getting the same disclaimer about not having released any "details" yet. I am not sure who said they talked to real people and got answers from AT&T, but I remember someone saying that. I got nothing from anyone, so either they have wised up or someone is really desperate to have something to post.

 

[nxent]

this is very anti apple. leave it to at&t to foul up a once wonderfully simplified process. way to go, at&t.

 

[macwh0re]

this is very anti apple. leave it to at&t to foul up a once wonderfully simplified process. way to go, at&t.

Not at all. If it wasn't for the people who didn't activate on AT&T, then there would still be a simplified process. As about half of iPhones purchased were activated on other networks, it was in their best interest to figure out a solution. Apple had to "approve" the subsidy. If there was no subsidy on the phone, then we would be in the exact same spot when the first iPhone was released. You pay full price and sign a contract. Full price would not be $199. No way no how. A Motorola KRZR sells for $200 directly from Motorola without contract. iPod Touches would cost $99... You get the point. It was against Apple's will to sell the iPhone the standard cell phone way, because of perceived value. I would agree on that. But because so many people unlocked the iPhone and went elsewhere, Apple had to do something, in order to fulfill their end of the contract with AT&T.

 

[clubvulgar]

scenario:

the original iphone comes out, 2007. i decide to switch over to at+t, but i realize i am paying an unsubsidized price for the phone. i open my account with a given subsidized phone (let's just say it's the free one, a nokia perhaps). seconds later, i purchase the iphone, swap it out for the nokia. voila! i now have the iphone and a nokia for ostensibly no more than i would have paid for the iphone alone.

how does at+t assess this situation? it's true that i have the original iphone, which i paid an unsubsidized price for, but i did expend my subsidy on the nokia. the principle would apply to anyone who purchased the original iphone while being under contract for less than 1 year; as of current, their 2 year contract (if those are the terms they agreed) has yet to expire.

 

[BrewCityGirl]

I just called AT&T Customer Service about when I'm eligible for a phone upgrade. I have been with AT&T for a little over three years now. I upgraded my phone in November '07. The Customer Service rep said I was eligible now for a payment of $18.

Not sure if it will be different with the iPhone.

 

[Tadros]

Why this is bull

Steve Jobs never said anything about $199 and $299 being "subsidized" prices he said it was maximum price world wide. Now if you are a current AT&T customer as I am and you are eligible for an upgrade, check all the phones there. Each phone has a main price, and then a price with the two year contract. Now if Steve Jobs DIDN'T lie, when you go to an AT&T store on July 11th there will be two prices, that is if there really is a "subsidized" price. It would be an "unsubsidized" price of $199 and $299 for 8GB iPhone 3G and 16GB iPhone 3G and have a "subsidized" of some lower prices that go along with your two year contract. So for the fact that they are screwing people over I think this is BS and Steve is a jerk for lying to us all. I say if Apple were really about standing by their word then AT LEAST the Apple store would have the maximum price be $199 and $299 no matter what the case with your contract. I also can't stand the fact that EITHER WAY you are locked in a 2 year contract! WTF If you are paying the "full unsubsidized"price you should not be locked in any kind of contract what so ever! AT&T and Apple really make no sense right now, and I feel bad for all you people that signed up for AT&T and got a crappy razor or sony for free and now have to miss out on an iPhone or pay ridiculous cancelation fees just to resign with the same provider. Thats just my two cents

 

[matticus008]

Steve said the MAXIMUM price would be $199.... that's what the ruckus is about, current AT&T customers previously subsidized will be paying more...

No, he said the price would be $199 US, and that it would be indexed to that amount almost worldwide. The maximum comment was in reference to the exchange rate, and was almost everywhere. That's what they're charging. Not everyone is eligible to buy a phone with a new contract.

AT&T charging customers $199 + $175 is more than the $199....

Apple is charging $199, period, for customers signing a new two-year agreement. It's your responsibility to put yourself in a position to do that. If you have independent obligations to AT&T, that's not part of the statement. If you have to pay an early termination fee to get it, that's not involved. If you choose some other service plan, that might impact the price. All of these details are up to the cellular carriers and outside the scope of Apple's keynote.

Pricing was announced to be $199.
That's what was announced & that's what the signs say in the Apple Stores.

And that's what Apple charges.

Why is there so much confusion with the pricing policy.
How about sticking to your word & hand out the phones at $199 and not concern yourselves with contracts, existing customers or new customers.

Because the contracts and customers are what enable the $199 price. Apple collects $199 plus tax from your wallet. You deal with AT&T for the rest.

It's not a sense of entitlement. It's that everyone was used to paying the same price for the phone for over a year and Apple told us all 199/299 for the iPhone for everybody. So is Steve Jobs a liar now?

The iPhone is $199/299 with a new two year agreement, exactly as described. If you're not eligible to enter into that new two year agreement, that's your problem, not Apple's.

 

[boss1]

how's that saying go? "once a thief always a thief".

Wasn't AT&T branded an abusive monopoly by the government for this type of reason?


I had hoped that the "new" AT&T was going to be a better company but I had a feeling this was coming .

They really can't be abusive and really go back to their old ways without market share so give another year or two. Then we're all screwed.

 

[marksman]

Why do you think they waited till July 11th to release the phone?

Either there has to be a way for Apple stores to check your ATT account (which is the time-killer), or Apple may have to sell it at a different price than ATT.

We'll see what happens.

Since O2 in England is saying they are training Apple store employees and providing the means to do credit checks, activations and all the rest, I am pretty sure the same thing will happen here.

Apple will do the same stuff here.

 

[boss1]

The unsub price is for people who's accounts don't qualify for a subsidized phone. Either way you still have to sign a contract. So if you get an unsub phone you'll pay up front and get a "monkey on your back."

I think our president made monkey's illegal today . I don't have all my facts in order . I heard something about Bush and illegal monkeys today. That's all i know.

 

[marksman]

many who criticize people on this should read this.....it the EXPECTATION that AT&T has created that is causing the problem. People would have been ok if you had told them in the first place but to come out later and change the pricing is what piss people off.

I don't know. I knew from the second the price was announced it was going to be subsidized. I am not sure where people got this expectation of anything else.

It seems to me most of the people with this expectation are young and lacking in life experience, so perhaps that is where the disconnect is.

Anyone who thought that the announcement was $199 for a walkaway unsubsidized 8 gig 3G iPhone was really not paying attention. So I think the resonsibility for these expectations should perhaps be on those who created unrealistic ones in their own minds.

I didn't say that....

Steve said the MAXIMUM price would be $199.... that's what the ruckus is about, current AT&T customers previously subsidized will be paying more...

As of right now that is not true as there is no other price except $199/$299 in the US for a 3G iPhone.

Do you want to call them a liar or do you want them to simply not sell the phone to people who are not eligible for an upgrade so they can be deemed honest in your eyes?

There is a subtle reason... Business. No other individual phone will be able to compare to the sales of the iphone. Thus, it is in the best interest of Att to cut some sort of a deal with people currently in subsidized phone contracts, even if it means losing a little money. For that reason I think there will be two unsubsidized costs.

Your position makes no sense.

From AT&T's perspective they have a group of customers who are contracted to pay them a monthly service fee for the next 12-24 months. This is what they want. This is the ONLY thing they care about.

Now these people complain, because they can't get the iPhone. Yet these people are still under contract, so who cares? You say it is business, but if it is business, then there is ZERO reason for AT&T to let you out.

See you pay them for the next 12-24 months on your old phone, and because you love the iPhone so much and can not get it anywhere else you will still end up getting one as your next phone and you will pay them for 24 more months.

So someone who is under contract and not eligible now, but is dying for an iPhone is someone they can count on to provide them monthly recevenue for the next 36-48 months. Why would they do something to lessen that? That would be bad business.

 

[yg17]

So someone who is under contract and not eligible now, but is dying for an iPhone is someone they can count on to provide them monthly recevenue for the next 36-48 months. Why would they do something to lessen that? That would be bad business.

With any cell phone company, if you renew your contract for 2 years, your contract ends 2 years from the day you renew, it doesn't add on to your existing contract.

Edit: Nevermind, I see what you're saying. They'll renew once their existing contract is up, right?

 

[booksacool1]

Havent read the previous discussion, but heres my 2c.

Its very ironic that at&t a treating new customers better than existing ones.
From a business perspective it makes sense, assuming they don't get a terrible rep (which they might from existing iphone owners). The existing owners are still on a contract, lured in by the iphone. Contract = money.

So much for customer loyalty.
Contracts are a trap.

 

[zync]

Your position makes no sense.

From AT&T's perspective they have a group of customers who are contracted to pay them a monthly service fee for the next 12-24 months. This is what they want. This is the ONLY thing they care about.

Now these people complain, because they can't get the iPhone. Yet these people are still under contract, so who cares? You say it is business, but if it is business, then there is ZERO reason for AT&T to let you out.

See you pay them for the next 12-24 months on your old phone, and because you love the iPhone so much and can not get it anywhere else you will still end up getting one as your next phone and you will pay them for 24 more months.

So someone who is under contract and not eligible now, but is dying for an iPhone is someone they can count on to provide them monthly recevenue for the next 36-48 months. Why would they do something to lessen that? That would be bad business.

Because people who have a regular phone would probably get the data plan with the iPhone, so they'd begin making $30 more on your contract right now, instead of a year or two from now.

 

[macwh0re]

If everyone could just head on over to AT&Ts website and check out the upgrade policy then you will all understand how it is going to work. Let me put it in perspective for you with imaginary numbers.

Blackberry Curve--
$369.99 no commitment price
-150.00 2 yr contract price*
-$100 mail in rebate**
-$20 instant data discount***
$99.99 final price

*standard upgrade/activation applies
**unlimited data and/or text messaging plan required
***see above

With a standard upgrade, (2 yr contract price, you are required to be at a certain point in your current contract to receive full $150 off of phone. If you are not, your might be eligible for an "exception upgrade" or "early upgrade" depending on things like MRC (monthly recurring charges), how far into your contract you are, if you pay your bills on time... you get it. If they approve you for that, then they meet you halfway with discount. Instead of getting the $150 off, you would get $75 off, plus the mail in rebate, plus the instant data discount, if you meet the requirements. Its like that at every cell phone company. AT&T, Verizon, Tmobile, Sprint... They might word it differently, but its the same thing. Sometimes, a customer who gets approved for an early upgrade, will get the standard discount price depending on the situation. (ie buying accessories, data plan...) something like you scratch my back ill scratch your back in AT&Ts eyes. So quit whining about how they are treating new customers better, because its a standard practice with every wireless company. If they treated existing customers better, they would be out of business. They can't hand out $270 worth of subsidies every 2 months because u want a new phone. If you read the contract you signed you would be aware of every detail from the start.

 

[SlyMac]

If everyone could just head on over to AT&Ts website and check out the upgrade policy then you will all understand how it is going to work. Let me put it in perspective for you with imaginary numbers.

Blackberry Curve--
$369.99 no commitment price
-150.00 2 yr contract price*
-$100 mail in rebate**
-$20 instant data discount***
$99.99 final price

*standard upgrade/activation applies
**unlimited data and/or text messaging plan required
***see above

With a standard upgrade, (2 yr contract price, you are required to be at a certain point in your current contract to receive full $150 off of phone. If you are not, your might be eligible for an "exception upgrade" or "early upgrade" depending on things like MRC (monthly recurring charges), how far into your contract you are, if you pay your bills on time... you get it. If they approve you for that, then they meet you halfway with discount. Instead of getting the $150 off, you would get $75 off, plus the mail in rebate, plus the instant data discount, if you meet the requirements. Its like that at every cell phone company. AT&T, Verizon, Tmobile, Sprint... They might word it differently, but its the same thing. Sometimes, a customer who gets approved for an early upgrade, will get the standard discount price depending on the situation. (ie buying accessories, data plan...) something like you scratch my back ill scratch your back in AT&Ts eyes. So quit whining about how they are treating new customers better, because its a standard practice with every wireless company. If they treated existing customers better, they would be out of business. They can't hand out $270 worth of subsidies every 2 months because u want a new phone. If you read the contract you signed you would be aware of every detail from the start.

Yeah thats all well and good but the iphone isnt being treated like any other phone in that they wont sell one without a contract. ATT offers all of their phones at a full price if you arent eligible for an upgrade. Those full price phones DO NOT require a contract. If ATT is going to truely treat this phone like "any other" then they either have to offer those who pay the full price, no contract extention or additional terms. Or, sell the phone with a partial subsidy and have them (non eligible customers) sign a new contract.

 

[macwh0re]

Yeah thats all well and good but the iphone isnt being treated like any other phone in that they wont sell one without a contract. ATT offers all of their phones at a full price if you arent eligible for an upgrade. Those full price phones DO NOT require a contract. If ATT is going to truely treat this phone like "any other" then they either have to offer those who pay the full price, no contract extention or additional terms. Or, sell the phone with a partial subsidy and have them (non eligible customers) sign a new contract.

You answered your own question. AT&T is a smart company, and they are sure to do their research before making a decision. If they can get away without selling it at a no-commitment price, u can bet they will. If for some reason they can't, guess what..Retail cost will be $1000. Same thing Tmobile did over seas when they ran into that same issue. 🙂

 

[dragonslayer458]

is there a possiblity that i'll have to either re-up my contract or cancel it and get a new one because my phone won't be discounted untill september of this year? If not, should i expect to pay a higher price for the new iphone?

 

[macfan881]

why are people upset that att just does this all cell phone companys do this its retarted that im looking to get a upgrade over verizon and yet if i want a decent phone i gotta pay over 99 bucks to get a decent phone and more if i just wanna just get a 1 year id switch over to att but my bro upgraded his phone cause it was broken and we didnt realize they sinked us in a 2 year upgrade for that

 

[know-it-all5]

Why would they do something to lessen that? That would be bad business.

They make more money on iphone monthly bills with data plans, than just voice plans. Obviously some people already have phones with data, but many iphone purchasers are new to data plans. By moving people to an iphone contract, with most people they will gain 30$ extra revenue.

EDIT: It seems that Zync said that above. Once again we share an opinion. Haha.

Care to keep debating marksman? I insist.

 

[LoganT]

The iPhone is $199/299 with a new two year agreement, exactly as described. If you're not eligible to enter into that new two year agreement, that's your problem, not Apple's.

Show me in the keynote where Steve Jobs mentioned in the keynote that the $199/299 price point was for only eligible customers.

 

[southcbishop]

I am fully aware of how things work in the Celcom industry. I am aware of how contracts are binding, and that I voluntarily signed mine. And I am willing to work with AT&T's terms. I am perfectly willing to pay the FULL unsubsidized price for a new iPhone. I am also perfectly willing to RENEW my contract (after only having gone though one year of the two) for two more years starting the day I purchase the FULL priced iPhone.

With that said, I have a few observations.

1) Just because I understand how things work does not mean I think there is no room for improvement. If we as consumers always accepted everything without throwing up an objection now and then, we'd be taken to the bank daily (even more that we already are if you can believe that 🙂 )

2) I, as well as anyone else have the right to leave AT&T, even if it does cost us a fee. Now its this fee that leads me to my real point.

What exactly, one might ask, does this fee pay for? Some might say that it is used to offset any loss AT&T might incur for subsidizing the phone you got when you first signed a contract. OK. So then what happens if you've bought a phone unsubsidized (like the iphone 1gen) and decide to cancel your contract? Guess what. You STILL have to pay a cancellation fee. Fine, lets just say that 175.00 was just a "hassle" fee.

But if you realize that AT&T builds most of what they paid for your subsidized phone into the monthly costs (eg: 70.00 p/m) that you pay then you realize that your phone is paid for in the two years you are with them contractually. So it might seem that the 175.00 cancellation fee plus any "cushion" they build into monthly fees will most definitely pay for your subsidized phone. ESPECIALLY since AT&T does NOT pay retail value (the price you and I would pay if we bought the phones up front). They almost always pay close to wholesale cost, since they buy directly from the manufacturer. I'm not sure if this is the case with Apple specifically, but I would bet that it is.

So my argument is this:

If you sign a new contract with AT&T and get a subsidized phone and pay a "padded" 70.00 p/m fee, and possibly a 175.00 cancellation fee, then fine, that was your choice.

BUT why would anyone buy an iPhone (or any other phone for that matter) for full price, and STILL have to pay the same 70.00 p/m and possibly the 175.00 cancellation fee when AT&T has no need to recoup a loss?

That is what my complaint is about, and that is the business practice that we as consumers must recognize as OVERCHARGING, and demand a satisfactory response.

Why should I pay the exact same amount to AT&T monthly and in fees, (having paid full price for my phone), as someone who gets a discount on their phone. Especially if I have already been a loyal AT&T customer for over 7 years.

If I pay for the iPhone at FULL price, and renew my contract for two more years, I expect that I should be able to CHOOSE to either NOT PAY a company a FEE becauseI decide I am UNSATISFIED with THEIR PRACTICES or PRODUCTS, or CHOOSE A CHEAPER MONTHLY PLAN!

My previos rant was really a more general gripe about the industry, cuz' I called AT&T two seperate times. Both times I was assured that NO MATTER WHAT, If you walk out of the store with an iphone, you paid 199/299. EVEN as a current non-iphone customer. You are simply renewing the contract you are already in for two years (from date of renewal). I'm not sure how they are able to do this (and there is of course the chance that both people I spoke with had noooo clue about what they were talking about). BUT I did ask them several times if that was correct and they both were very confident in what they said. My guess is that Apple foresaw this hiccup, and decided that AT&T could pay a lower subsidy price per phone if they agreed to a standard price point. That would mean that the subsidized prices COULD have been lower (eg: 99/199), but because AT&T decided to pay less for the subsidies, they could dump the difference between "qualified" and "unqualified" customer costs into each phone across the board.

Eh, it's just a theory based on shaky evidence at best🙂

 

[Rhinestorm]

Lol. I can't get an iphone until April 2009. Bloody hell with 2-year contracts.

 

[SlyMac]

[/B]

You answered your own question. AT&T is a smart company, and they are sure to do their research before making a decision. If they can get away without selling it at a no-commitment price, u can bet they will. If for some reason they can't, guess what..Retail cost will be $1000. Same thing Tmobile did over seas when they ran into that same issue. 🙂

I didnt realize I was asking a question as it was my opinion.

As for the rest of your reply, ATT has already made it clear that there won't be a No commitment price so the rest is moot.