At&t will give in and kill early upgrade fee - opinion

[eezing]

After reading multiple articles on this topic it seems there's a good chance At&t will do away with the iPhone specific early upgrade policy.

Factors:

Changing their policy...

- Will win the hearts of the loyal iPhone community and users. The best advertising is by word of mouth. The iPhone 3G community is quite large as well as quite passionate... You see where I'm going with this.

- Will strengthen\not destroy their relationship with Apple which in return will help extend their exclusive U.S. iPhone contract. See, Apple reacts quickly to their customer complaints/suggestions; they wan't At&t to do the same. When it comes to the iPhone, Apple and At&t are a team, but Apple has the upper hand.

- I'm just throwing this out there... Even with the 3G being subsidized, I don't think the profit margins are so small that At&t will take a significant hit by allowing free upgrades, or at least get hurt.


WELL WELL, LOOK IT HERE GUYS. DID I CALL IT OR DID I CALL IT? BOOM!

 

[citron230]

I wouldn't count on it.

 

[nfl46]

I mean, I don't think they should make people pay 599/699 for it, BUT 399/499 is REASONABLE if you aren't eligible for an upgrade.

They should do away with the 599/699. That's WAY too much. 399/499 is pushing it, itself. 399 is my MAX, as this is what I'll be paying next week.

 

[Pacpod]

Would be nice, but I highly doubt it. Us 3Gers did sign a 2 year contract that we are bound to hold. Would I like to be given the option of a cheaper phone, yes, but do we deserve it, not really.

 

[mrtune]

Don't bet on it. AT&T isn't that nice.

And neither is any other American cellphone company for that matter. They would rather lose you as a customer than to give you a free phone every time you complain you should receive the latest and greatest model.

If you give to one, you have to give to all.

 

[anjinha]

The iPhone's real price is 599/699. They subsidize it so people pay 199/299 up front. You pay the other 400 over a two year contract. By letting you upgrade to another subsidized phone half-way through your contract they are losing 200 with every iPhone they sell. You think that's not much?

And what about next year, when another iPhone is released? Should they let people upgrade again and lose more money again? And why should the iPhone be different than any other subsidized phone?

I agree that 399/499 is a reasonable price to let people upgrade if they are halfway through their contract. Don't hold your breath for anything better than that.

 

[gr8tfly]

Doubtful. The contract works just like any other subsidized phone has for last 5+ years.

 

[bndoarn]

i don't think this will happened because if they don't charge for early upgraders for the iPhone, then AT&T will just hear even more complaints from people who are being charged for upgrading early with other phones.

 

[labman]

you signed the contract

just as I am agreeing to a 2 year with my 3GS now so if they come out with a 3GS+ or 4G it will be me that has to wait. you contr5act does not say you get a new phone every time Apple comes out with a new model. Get over it already. next year you will have the new model and I will be sad.

 

[Cloudane]

I doubt it for the same reason as with O2 - they can't give an inch without making a loss, because of Apple's supply pricing, so they are going to hold you to the contract you are legally bound to this time.

Will Apple give in and drop the price, so that it's at least half reasonably attractive to upgrade? Quite possibly if there's not enough uptake, just like they did with the original iPhone.
Will they repeat their goodwill gesture of a $100 voucher to those who bit the bullet and paid full whack then cried when they dropped the prices? I very much doubt it (it was a one off, their customers were supposed to accept this and learn for the future).

 

[Eddyisgreat]

The iPhone's real price is 599/699. They subsidize it so people pay 199/299 up front. You pay the other 400 over a two year contract. By letting you upgrade to another subsidized phone half-way through your contract they are losing 200 with every iPhone they sell. You think that's not much?

And what about next year, when another iPhone is released? Should they let people upgrade again and lose more money again? And why should the iPhone be different than any other subsidized phone?

I agree that 399/499 is a reasonable price to let people upgrade if they are halfway through their contract. Don't hold your breath for anything better than that.

Yup. The real stupidity is that alot of 3g owners feel they are entitled to the new phones. Some are trying to say that ATT is wronging them because they are willing to sign another 2 year contract on top of the additional year, but they don't realize how stupid of a proposition this is. Apple will keep releasing phones, and if ATT is still an exclusive provider than you can see how that would snowball into 3, 5, 7, 9 year contracts where ATT CANNOT change the terms as they see fit. Others are saying that ATT set a "tradition" of subsidizing new phones for existing users at the same rate as new users, even though that was only half the story and it only happened ONCE!

I seriously doubt ATT will cave for a little less than 10,000 users (the number of twits that signed that twitition). If they do, backlash will be swift and great from blackberry users who want the same type of treatment. New customers, such as myself, will probably shy away from ATT because of their willingness to take part in such foolishness, unless they can offer me the 32gb 3gs FREE OF CHARGE. its only fair, right?

ATT can either piss off 10000 users and stick to standard provider policies or they can open the floodgates and take a beating from all sides.

If you don't believe how stupid some people are you should check out the official ATT 74 page thread on this.

teedo - AT&T - You need to allow iPhone 3G users to upgrade to the newer iPhone 3GS at the $199 and $299 price points, respectively. You need to do this because, as a loyal AT&T customer, I know that your data speed over 3G has not lived up to your promises. The fact is: websites on 3G load slower then dial up conection. It took me over 30 seconds just to update a "WWDC Apple Blog". This happened several times. This is not "near wi-fi". We need to have the 7.2mbs hardware in our phone so that when you roll out your 3G network update 3G users can take advantage of it.

sivey1981- I'm truly disappointed in Apple/ATT's decision to not allow existing 3G users to upgrade to the new 3GS phone for the same price as new users.



Apple/ATT established the precedent for discounted upgrades for existing users when the 3G came out. They should continue in this tradition and reward loyal customers who want to purchase the phone as it upgrades year after year. Forget the technicalities of the fine print in the contract, just go with your gut on this Apple/ATT - it makes sense to reward loyal customers who want to pay you money to get the latest phone model each year when it comes out.



The bottom line is that this is going to anger a lot of people who will feel, like me, that they are being punished for purchasing the 3G last year. After waiting for months for news of the release of the new phone with excited eagerness, I'm left feeling like a second-rate customer who will consider another smart phone option when my contract expires. So much for the loyalty to existing customers that Apple/ATT has normally shown. They've turned a die-hard Apple/ATT enthusiast into a doubter in one day.

jwkay123 -
THIS REALLY TICKS ME OFF AT&T, YOU ARE GOING TO LOSE MANY MANY CUSTOMERS ONCE APPLE BRANCHES OUT TO ANOTHER CARRIER... YOU KNOW WHY? BECAUSE YOU ARE NOT CONSISTENTLY LOYAL TO YOUR CUSTOMERS... SUBSIDIZE THE PRICE OF THE IPHONE 3G- S FOR PREVIOUS IPHONE CUSTOMERS LIKE YOU DID LAST YEAR!!!!!!!!!!!!!!!!!!!! WE ARE GETTING MAD:manmad:

terryt5231 -
I'm officially lodging a complaint about the ridiculous "upgrade" policy of AT&T iPhone users. The fact that I must pay an additional $200 for a new iPhone 3GS, EVEN WHEN I'M willing to re-up my contract for two years, is the most inconsiderate, unfriendly, unfair business practice that I've heard in a long time. Way to alienate your loyal customers. Thanks a lot AT&T.

r_connolly -
I agree! iPhone owners are an elite group of people who deserve better than this. We already pay enough through our plans to offset the cost. There is no reason at&t can't do this, the fact is, is that they just want more money. This makes me very :smileymad: !!!



Also at&t, get your act together and support MMS at the launch of OS 3.0 like almost every other carrier who supports the iPhone is. And please get some sort of tethering plan for the iPhone soon that isn't too expensive.



Finally, I want to say that I have had no problem with at&t before this. I have never had a dropped call, always have fast 3G speeds, and all-around good service. But now at&t has really disappointed me. If they don't start to act better they will lose possible new iPhone owners to all the new smartphones (pre, storm).

gbraddock81
I could not disagree with you more. At first glance, it appears as though this forum is about contract renewals, impatience, etc. I on the otherhand know better. This is about or should be about Apple releasing 3 phones, each one uniquie in it's own way; the 1st Gen iPhone... it was the iPhone, no topping it. 3G iPhone, came with 3G technology for faster connection speed. 3G S now has a video camera. You seeing my point here? It's kind of like going to "Salad World" and ordering a chicken caesar salad. You get to your car and discover no caesar dressing! You go back they give you a new salad and say that'll be $1.50 extra... You pay the $1.50 and go back to your car to discover this time, THERE'S NO CHICKEN!! You go back, they give you another salad and this time you make sure everything is there and they say, that'll be $3.00 extra and you're like WHAT, I ordered a chicken caesar salad and you didn't give me what I wanted and now you're charging me extra?



That's how iPhone users feel, we bought a phone that did not have very common technology. That's what this forum is about. Apple picked and chose what technology they were going to release with each iPhone, which to me is deceitful especially when every other major cell phone manufucturer is readily producing this technology with phones that cost WAY LESS than iPhones. That's the issue here, the fact about the contracts is again, secondary.

thetoad30
Everyone here keeps going back and forth about two year agreements and subsidies and crap like that.



A smart business, AT&T and Apple, would have said the following:



Apple: "We're going to be releasing new hardware every year!"

AT&T: "We usually have two-year agreements!"

Apple: "How are we going to work this out so we don't upset our customers?"

AT&T: "Good question! Maybe we need to figure out a yearly contract or some means to provide for our customers!"



You know, since they were smart enough to cover their {word filter evasion} for their so-called unlimited data plan specifically for the iPhone customers that isn't really unlimited because I can't send MMS or use it to tether. Nice that AT&T can cover their losses, but not care about their customers. And no, I'm not letting Apple off the hook either.



They KNEW that AT&T wasn't ready for the 3G iPhone, so they released a crappy edge phone first. Then popped 3G in a new phone a year later, AT&T STILL wasn't fully ready, and AT&T and Apple ALLOWED iPhone customers to upgrade for an $18 fee and another 2-year contract. GREAT! we all thought. Until we started having 3G issues, call drops, and Apple's "warranty" started to show for its true colors: Water sensors that would go off from being in the bathroom while showering, or from sweat going into the phone while working out. I even had an Apple "Genious" recommend me a waterproof case they were selling for $100 in an Apple store (I was looking for the naked case) as a clear case, and when I asked him if Apple backs that case up if the phone gets wet, he said no, of course not. {word filter evasion}



Now Apple releases a 3GS with features like MMS and tethering that AT&T STILL isn't ready for. Really, guys? Doesn't anyone have half a brain to look at this situation and maybe even stop to think how atrocious this all is? Not only are you completely {word filter evasion} customers off for not allowing us to upgrade (even when we hand over our {word filter evasion} for two years) and pay you more money for the device, but you then use some BS excuse of saying you have to have us for so long to "cover the cost of the phone". Seriously? It really costs you $5 a month for me to send only 200 text messages? Like a text message costs you so much to send. It's just data. And $40 a month for 450 anytime minutes? If those are so pricey, why do you give me unlimited texts for $20 a month, and then 5000 night and weekends for "free"? GIVE ME A BREAK. You are charging me $75 a MONTH for service. There is no way you cannot recover the "cost of the phone" until 18 months. If so... you have a really crappy buisiness model and I fear we soon will be paying YOU a bailout like we did with GM and Chrysler.



Both companies have made huge mistakes in this game. The only problem is, no matter what, it's the consumer that gets to pay for it.

 

[dagomike]

If Apple is opening up to Verizon, etc in the next 12 months, then yes I agree they'll probably change their tune. Better to lock people in an extra year than watch them take off when their contract is over next summer. Otherwise, they're losing money and I wouldn't count on it.

 

[eezing]

ATT can either piss off 10000 users and stick to standard provider policies or they can open the floodgates and take a beating from all sides.

Those 10,000 twits represent more like 50,000+ users. I don't twitter. Although, I really don't care that much about the whole issue to begin with. But, I would probably upgrade If there was no upgrade charge... so yea, I guess I am one of those 50,000 users.

 

[Primejimbo]

The iPhone's real price is 599/699. They subsidize it so people pay 199/299 up front. You pay the other 400 over a two year contract. By letting you upgrade to another subsidized phone half-way through your contract they are losing 200 with every iPhone they sell. You think that's not much?

And what about next year, when another iPhone is released? Should they let people upgrade again and lose more money again? And why should the iPhone be different than any other subsidized phone?

I agree that 399/499 is a reasonable price to let people upgrade if they are halfway through their contract. Don't hold your breath for anything better than that.

I agree, and we get to hear this all over next year... I can't wait
Again it's all at&t's fault for not letting you upgrade every year Do Blackberry users do this when a new phone comes out?

 

[GfPQqmcRKUvP]

Those 10,000 twits represent more like 50,000+ users. I don't twitter. Although, I really don't care that much about the whole issue to begin with. But, I would probably upgrade If there was no upgrade charge... so yea, I guess I am one of those 50,000 users.

Then you just don't understand business. ATT is paying $600 for each iPhone from Apple, you expect them to subsidize you $300 every year just because you want a phone before the contract that ATT expects you to pay them back for the subsidy with is over? You're nuts.

This has nothing to do with alienating customers. This has to do with average Americans having no clue what business model ATT operates with.

 

[anjinha]

What people don't seem to realize is that the 2G iPhone wasn't subsidized, people payed full price for it upfront, so AT&T wasn't losing any money by letting people upgrade early to the 3G.

 

[mrtune]

If Apple is opening up to Verizon, etc in the next 12 months, then yes I agree they'll probably change their tune. Better to lock people in an extra year than watch them take off when their contract is over next summer. Otherwise, they're losing money and I wouldn't count on it.

No they won't. Verizon is just as bad as AT&T. I think they are worse. Look how they treat their smartphones. Blackberry's have their GPS crippled so that the only thing that works is Verizon's navigation service. They also don't allow phones with wifi capabilities. They demand that phones only go through their data network. These requirements would cripple the iPhone. Who would switch then?

 

[AiralynRose]

I hope they don't. Those who are complaining really make us all look like a bunch of elitist *******s when you whine and complain because AT&T is treating you like they do all their other non-iPhone customers.

Having an iPhone doesn't make you better than everyone else. You do not have to get a new iPhone every year just because there is a new one. iPhone users don't pay anymore monthly than blackberry users and other smartphone users (all data plans for smartphones are $30!)

 

[eezing]

I agree, and we get to hear this all over next year... I can't wait
Again it's all at&t's fault for not letting you upgrade every year Do Blackberry users do this when a new phone comes out?

I side with you here, but you need to understand that the iPhone user base is different than that of any other phone user. They just down right care more.

Here's the other truth, subsidized or not, paying more than $400 for a handheld device feels dumb. See, Apple advertises the price of the phone at $200 and $300, not $600... if they did, I'd laugh right in front of their faces.

Please tell me you really don't think the overhead is barley covered by a $90 a month plan.

Again though, we all signed a contract and as far as I'm concerned we're bound by it.

 

[joro]

Do I hope they reverse the policy? Of course; however, I don't think it will happen and I wouldn't expect them too. Coming from a business background, it makes no sense for them to allow users to upgrade every year when Apple releases a new version, especially considering they are in 2 year contracts. I am one of the loyal iPhone users who was standing in line for both of the launches thus far - pre-ordering this time - and I do understand how people feel they have been "screwed" by AT&T. But I believe if you don't want to pay the "ridiculous" price, then don't, there is nothing mandating you have the latest and greatest iPhone.

 

[joro]

What people don't seem to realize is that the 2G iPhone wasn't subsidized, people payed full price for it upfront, so AT&T wasn't losing any money by letting people upgrade early to the 3G.

Amen! I think this is something which most people have overlooked based on their experience moving from the original iPhone to the 3G. The fact is AT&T didn't subsidize the original iPhone which is why all of us got the subsidized price on the 3G.

 

[eezing]

Then you just don't understand business. ATT is paying $600 for each iPhone from Apple, you expect them to subsidize you $300 every year just because you want a phone before the contract that ATT expects you to pay them back for the subsidy with is over? You're nuts.

This has nothing to do with alienating customers. This has to do with average Americans having no clue what business model ATT operates with.

I understand completely, but that still doesn't change the fact that there are 10,000 twitters going crazy. As I said, I really don't care either way.

 

[Eddyisgreat]

Those 10,000 twits represent more like 50,000+ users. I don't twitter. Although, I really don't care that much about the whole issue to begin with. But, I would probably upgrade If there was no upgrade charge... so yea, I guess I am one of those 50,000 users.

50,000 users? Proof?

Right now its just a very vocal minority. 50,000 iphone users roughly equals 5 million dollars in revenue, which, if this was a legitimate issue, would be 5 million dollars in lost revenue. ATT Mobility (wireless) made 10.5 Billion dollars in just DATA services revenue in FY08, and on top of that, sold like what 20 million iPhone 3g's also in 08 (but I can't get a firm number, someone correct me if they find a figure).

"50 thousand" users accounts for about 1/400 of sold 3g's. 5 million accounts for 1/2100 of the overall revenue from data.

Considering these users probably won't jump ship, I'd say ATT has better things to worry about.

 

[anjinha]

I side with you here, but you need to understand that the iPhone user base is different than that of any other phone user. They just down right care more.

Here's the other truth, subsidized or not, paying more than $400 for a handheld device feels dumb. See, Apple advertises the price of the phone at $200 and $300, not $600... if they did, I'd laugh right in front of their faces.

Please tell me you really don't think the overhead is barley covered by a $90 a month plan.

Again though, we all signed a contract and as far as I'm concerned we're bound by it.

How much did the original iPhone cost again?

If people think this is too expensive for a phone they should complain to Apple, not AT&T (not that it would do any good).

Also, a lot of other smartphones cost the same, people just don't realize it because they're used to the subsidized price. The iPhone is no different.

 

[tasset]

Then you just don't understand business. ATT is paying $600 for each iPhone from Apple, you expect them to subsidize you $300 every year just because you want a phone before the contract that ATT expects you to pay them back for the subsidy with is over? You're nuts.

This has nothing to do with alienating customers. This has to do with average Americans having no clue what business model ATT operates with.

I have come to despise the contract/subsidy model that America has become addicted to. Yes I agree most people do not understand the monthly service fee they pay has built in their subsidy over the contract. I wish those hidden costs were EXACTLY laid out to the customers.
An equal amount of blame lies with the carriers I believe. For instance, AT&T covers $400 of the iPhone price for us that is "supposedly" spread out over 24 months - roughly $15/month. Sooo what we're saying is data should be $15/month right? And AT&T adds in the extra $15 to recoup the phone. So then, when the 24 months is up and I chose to continue using the same phone then my data price will drop to $15? Nooooo?? Well why not if AT&T has now covered their cost? Because the carriers are trying to have their cake both ways, that's why.
Let the equip manufacturers compete with each other head to head on hardware and the carriers on service/price. THEN and only THEN will us consumers win. FCC, hello, anyone home?