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AT&T kickback?

S

stev

macrumors newbie
Original poster
so, might some of that 130$ extra for the one with the 3G radio be kicked back to at&t? this might have been some of the sweetener that at&t wanted to allow for the no contract service . . . .



hmmm . . . . . . .
 
Could be

... but for the iPhone, the kickback worked the other way, with Apple getting a slice of the monthly data fees.
 
But I've/we've all wondered why 3G costs $130 more. I've heard estimates of the parts being $10. Okay, perhaps $30 for the whole module, backshell change, whatever.

So, $100 to AT&T as payment for 'lost' revenue for no monthly contract to make up for the cheap data prices makes sense. Maybe that deal was only for one year? So, after all the newness wears off, the first iPad refresh (next spring) will give us one line, all with 3G, and a cheaper price (essentially free 3G radio, as it should have been now).

Of course, I'm making all this up. But it covers all the facts. It never made sense to have two kinds of iPads, especially when 3G was optional. Unless there was a good monetary reason for it. 😀😀
 
I can't imagine Steve Jobs agreeing to pay AT&T for something they don't have to deliver. In theory, a 3G owner could never use AT&T, so I can't see Apple's negotiators paying AT&T anything on speculation.

What should've been done is you get your first month free. Get people hooked, and make that $130 premium seem like $100.

On the other hand, when the 3G doesn't sell so well, I would imagine AT&T would sell a subsidized model in their stores. Say $130 off if you sign up for a year or two in advance, so the playing field is leveled. I would have gone with a 3G if the price was the same, but I had to pay $30/month for a year or two. That would have been in AT&T's interest ($360 to $720, for a $130 subsidy). AT&T's CEO even said he didn't think people will go for the 3G.

http://www.ipadinsider.com/att-ceo-expects-wi-fi-only-ipad-to-be-more-popular/
 
Apple charges more because they can.

I'm sure Apple actually gets a kickback on each monthly data plan sold.

Apple is driving this bus, not ATT.
 
ScottFitz said:
Apple charges more because they can.

I'm sure Apple actually gets a kickback on each monthly data plan sold.

Apple is driving this bus, not ATT.
Click to expand...


I agree.

I found this article to be interesting and possibly insightful. The theory on the $130 charge was that it subsidizes the entry model, allowing Apple to hit their key $499 price point.



B
 
Hmm... extra cutout in the aluminum, black plastic piece, 3G radio, GPS chip... am I missing anything?

They probably have a way of calculating these things to come up with a price to reflect the upgrade. Still seems a bit high considering, but hey, this is Apple we're talking about here.

IMO, they should only have had 3 models to begin with, 16, 32 and 64, all with 3G. Would have made the decision for people much easier.

Man, I was flip flopping for days trying to decide which one I wanted.

Bierp said:
....The theory on the $130 charge was that it subsidizes the entry model, allowing Apple to hit their key $499 price point.
Click to expand...

I thought they did that by using s****y screens in the 16GB wifi model.
 
AT&T is lucky to still be exclusive with Apple. Apple doesn't need to throw that much money at AT&T.
 
stev said:
so, might some of that 130$ extra for the one with the 3G radio be kicked back to at&t? this might have been some of the sweetener that at&t wanted to allow for the no contract service . . . .



hmmm . . . . . . .
Click to expand...

That has been the speculation since the intro, and seems logical. I vote yes.
 
Chupa Chupa said:
That has been the speculation since the intro, and seems logical. I vote yes.
Click to expand...

My uninformed vote would be Apple decided on a $100 for themselves and negotiated and arrived at $30 with AT&T.

Also kickback should be to subsidize a low cost and convenient service.
 
Don't forget that AT&T pays Apple for every iPhone sold. Why would that be completely opposite for the iPad?
 
How is it any different for apple to charge $130 for the 3G option when Dell charges $125 for the option on their laptops?
 

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I'm sure that the SIMs are activated in AT&Ts system with no service. They have to maintain the extra records in their system, so I could see a "piece" of that going towards it. But if Apple is a great negotiating company, they could strongarm AT&T into it as part of the "cost of doing business".
 
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