Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.
I think AT&T is evil and it has nothing to do with it raising the price. It pretty much gave the NSA a backdoor to its network, so the government can snoop on AT&T users whenever it pleases (EFF sued AT&T over this issue and a whistle blower brought the matter to light). Further, it willingly gives other government agencies customer information without a Court Order.

Moreover, AT&T engages in false advertising and bait and switching. For instance, it will advertise a price for a service (e.g. DSL) and have people sign up. Then it will tell the people they do not offer that price in their area. I have personal experience with that practice.

In addition, AT&T is being sued for improperly calculating data charges. It essentially is billing people for data packets the customers are not using.

The whole purchase T-Mobile thing is according to AT&T internal documents not to purchase additional bandwidth, but so it can milk T-Mobile customer by increasing the cost of data plans.

Now you might claim AT&T is just doing what businesses do. That might be true, but then businesses such as AT&T are inherently evil.

Well, first, I guess we have different ideas on the meaning of evil. I think it's a little strong to describe a phone company, but I don't want to split semantic hairs - so we'll just leave the word "evil" alone.

As far as "doing right for the consumer" - companies are in the business of making money. (I am not decrying or defending this, just stating a fact). You're suggesting that there are nice ways of doing this, and rude ways of doing this. But at the end of the day - they exist to take money and provide goods or services. I'm not sure I agree that making me feel good about giving up my money is anything more than an effective marketing tactic - but,IMO, it is no more good or evil than a company that just takes the money without any such concerns. In the confidence game it's called "cooling the mark". After conning somebody out of their money, they make mark feel like they haven't been hustled. It's the car salesman telling you that you just made a great deal - you feel good, but they still got your money.
 
People actually believe this phone costs nothing or 99¢.
This phone is only 99¢ upfront with a high monthly cost + a plan locked in. Marketing at it's best.
 
People actually believe this phone costs nothing or 99¢.
This phone is only 99¢ upfront with a high monthly cost + a plan locked in. Marketing at it's best.

Isn't this how it always is with "free" phones? This is not the first time a phone has been marketed with this kind of pricing.
 
Wirelessly posted (Mozilla/5.0 (iPhone; CPU iPhone OS 5_0_1 like Mac OS X) AppleWebKit/534.46 (KHTML, like Gecko) Version/5.1 Mobile/9A405 Safari/7534.48.3)

I work at AT&T, This is being done to help prevent fraud as the .99 cents cannot be billed to your bill. It must be charged to a credit or bank issued debt card. Fraudsters are using stolen identities to steal these handsets ....been an issue since they went free

You don't have this problem with any other $0 handsets?
The problem would be most severe for the Apple phone because it has more negotiable value on the grey and black markets - some may head overseas to be used as an unlocked instrument (tho' that's becoming a bit more common here). So who's going to personally risk a fraud charge to obtain "free droids" (one at a time at that, and you have to have some stolen info to qualify as someone with an existing account) when there's so many hundreds of crappy models out there? What do you think you can fence one of those for??

Apple carefully limits its SKU's and everyone everywhere pretty much knows what a 3GS is.

I'm jus' sayin'......
 
Darn, I was gonna buy one but now I can't afford it. I'll wait till next year when the price goes down
 
Nothing to do whatsoever with fraud ...

This had nothing to with fraud and all to do with economics …

The AT&T rep that spoke made that up.

YOU MUST HAVE A CREDIT CARD in order to buy an iPhone … you cannot pay cash because the iPhone 3GS is a contract phone.

You can't just walk into a store and get unlimited phones, even on stolen accounts.

Give AT&T a little more credit than that.

You also have to prove you have a compatible SIM and add the phone number to the new phone OR purchase a new SIM that will be billed to your next bill.

Even if you don't have autopay or normally pay by credit card you have to have a credit card on your file or you are subject to a credit check at the time of purchase _ something fraudsters don't (and really can't) pass.

Think about this logically …

The 3GS is the best selling cellphone … period.

Why not make a buck per sale?

200,000 of these have already been sold, that's $200,000 AT&T missed - as the holidays approach ~ this is sure to accelerate. I know I'd consider this versus an iPod Touch for my son.
 
Didn't read the other 108 comments, but the update on the post is most likely correct:

Update: MacRumors forum user Metcury46l had one possible explanation for the price change: I work at AT&T, this is being done to help prevent fraud as the 99 cents cannot be billed to your bill. It must be charged to a credit or bank issued debt card. Fraudsters are using stolen identities to steal these handsets ... been an issue since they went free.

When I worked at the Apple Store and we were selling the original iPhone and iPhone 3g, it was a requirement to buy them with a credit card so that we could track how many the buyer had purchased (there was a limit of 2 per person per credit card at the time). The reasoning was to stop the purchase and dissemination of jailbroken and modified sets and maintain quality control for Apple, not to mention making sure there were enough to go around. Though several of the reasons this was done have changed in past years, the overarching reason is still the same: the charge is likely just to verify the person's identity and provide a guarantee on contract payment after purchase.
 
Anyone who is not wealthy that spends thousands of dollars over a 2 year contract on a phone is a complete idiot. If he was not an idiot, he would deposit that $100 a month into a retirement fund and realize that at retirement in 35 years, assuming an annual return of 6.5%, he would have $168,000 in his account. Or he could be clever like you and get the 4s instead of the idiot who got the 3g, and have zero in his account, but such fond memories of pinching and scrolling!



This is idiotic. On many levels.

First of all, it doesn't cost "thousands of dollars" over a two-year period to have an iPhone. The most common plan runs $65 plus taxes - say $73/month. Although if you use the cheapest plan, you pay $55/month.

Second, unless you are going to go *without a phone* for 30 years, the relevant cost is not the total cost of the iPhone's plan, but the marginal cost of the iPhone over the cost of a dumbphone. Which works out to $25 for most people, but can be as low as $15/month. And there is some real value to having access to e-mail on your phone.

Third, $168,000 is not going to make the difference between a comfortable or uncomfortable retirement. Even assuming you can get a 6.5% return, which is certainly more than the S&P has grown in the past 10 years or so. And that's not even including taxes or accounting for inflation.

Of course there are some people who probably can't afford an iPhone. But suggesting that having an iPhone is going to doom the non-wealthy to lives of quiet desperation upon retirement is beyond silly.
 
I could be wrong, but I think they might've done it for the same reasons a lot of people sell their houses for $1 - avoiding paying taxes on a "gift".

Of course the government is going to want their palms greased.
 
What I would like to know is how much the Sales taxes are on it. my 32gig 4S was $299.00 but $365.00 out the door.

That doesn't sound right at all unless you bought something else with it or paid a signup fee.

Even 9% sales tax on $299 would bring it to $325.91. You must have paid $40 for something else.

Note that in some locales (NYC is one of them), if something is discounted, you pay sales tax only on what you paid. But if you use a coupon, you pay tax on the full value, not what you paid.
 
I like the update response, but it could be that the easy pay machines hate 0.00 on pricing. Apple Stores have to do an annoying charge of 0.01 and take it out of the cash register (at no cost to customers), but theres customers that love to complain about that weird .01 cost that show up on the receipt when it's supposed to be free. I also bet that Apple accountants loved this. There could be several reasons why Apple changed it to $0.99. **This coming from an ex apple employee.
 
The demographic that this is targeted at are really those that shouldn't be signing up for a data-plan to begin with since they can't afford. You get a "free" phone but then pay $30 a month for 2 years to cover that cost.

Its big corporations like Apple that are contributing to America's huge debt problem. What they are doing is very similar to "you pay zero down" scams that caused the housing crisis... not on the same scale ofcourse, but I am sure even the Apple FBs can see the similarity.

So it's Apple's fault that some people are too stupid to realize they're committing to a 2-year agreement?
 
Lot's of money

If 100,000 people buy it for .99 cents plus tax...then thats a bunch of $$$$ for employee bonuses.


[url=http://cdn2.macrumors.com/im/macrumorsthreadlogodarkd.png]Image[/url]


Image

In a curious move, AT&T has raised the subsidized price of its cheapest iPhone to $0.99, up from free.

When the iPhone 4S was announced in October, Apple specifically mentioned in its press release that the iPhone 4 and iPhone 3GS would be available in 8GB capacities for subsidized pricing of US$99 and for free, respectively.

During AT&T's Q3 2011 earnings call with analysts on October 20th, AT&T Mobility CEO Ralph de la Vega twice mentioned the iPhone 3GS's $0 price point, saying during the introductory remarks:
De la Vega again mentions the 3GS during question-and-answer portion:
Image


It is unclear why AT&T has elected to raise the price of the iPhone 3GS by a negligible but still notable amount a month and a half after it became free on contract, particularly given the fact that both Apple PR and AT&T Mobility's CEO had specifically touted the free nature of the device. In response to a request for comment on the price increase, AT&T declined to offer a specific reason:
For its part, Apple continues to offer the iPhone 3GS, subsidized on AT&T's network, for $0.00 on the Apple Online Store.

Update: MacRumors forum user Metcury46l had one possible explanation for the price change: I work at AT&T, this is being done to help prevent fraud as the 99 cents cannot be billed to your bill. It must be charged to a credit or bank issued debt card. Fraudsters are using stolen identities to steal these handsets ... been an issue since they went free.

(Image courtesy Flickr/MrVJTod)

Article Link: AT&T Raises Subsidized iPhone 3GS Price to $0.99
 
Register on MacRumors! This sidebar will go away, and you'll see fewer ads.