Contract and Subsidy Issues for iPhone Users Looking to Upgrade to iPhone 3G S

[Chaos123x]

My 2g original iphone on my second line is not eligible either.

I expected that my subsidized 3g iPhone would not be.

But my other line never got a discount phone, or free phone.

Mother #$%^!!!

 

[stuarty2003]

The outrage in the UK isn't over those who are still in contract (well, some of it is, but not the part that really has a point).

It's that O2 have DOUBLED the price of an iPhone 3GS over the 3G at it's launch despite the US prices being exactly the same for people who aren't in any sort of contract.

And the crazy tethering prices.

Phazer

That would be a good comparison if the 3GS was the same spec as the 3G.

 

[adomanico18]

This Is Crap!

they better figure out a deal for all of us 3G users!

 

[crtowles]

What I was told...

A very nice customer service rep at ATT advised me that they are able to override any upgrade restrictions except for the iphone. She tells me that apple imposed this restriction on them. Not to sure if this is true but this is what she was told.

 

[diamond.g]

Taken from AT&T's webpage:

AT&T Upgrade AdvantageSM
AT&T Upgrade Advantage is a custom-tailored program that rewards you simply for staying with us. Not only will you receive discounts on the widest selection of wireless phones, but the higher your monthly rate plan and data-package rates, the more you’ll save. It’s a well-earned reward for your loyalty. Additional discounts do not apply to iPhone.

Monthly charges per line: Greater than $99
At 18-23 months since activation/upgrade
Additional $50 off our standard 2-year service agreement discount
24+ months since activation/upgrade
Additional $100 off our standard 2-year service agreement discount

Monthly charges per line: Between $69 and $98.99
18-23 months since activation/upgrade
Standard 2-year service agreement discount*
24+ months since activation/upgrade
Additional $50 off our standard 2-year service agreement discount*

Monthly charges per line: Less than $68.99
Standard 2-year service agreement discount begins after 20 months

* Monthly Recurring Cost (MRC) is based on a three month average of your rate plan plus selected data features.
* The Standard 2-year contract renewal discount is the same for new customers. Two-year contract renewal discount does not apply to iPhone.
* Upgrade offers are determined per each individual line.
* You can earn additional equipment discounts of up to $100 off of the standard 2-year contract renewal discounted price. Additional equipment discounts do not apply to iPhone.

* Additional discounts do not apply to iPhone. Upgrade AdvantageSM Program Terms and Conditions: See Rate Plan Brochure, Terms and Conditions and Wireless Service Agreement for full terms applicable to selected rate plan. Customer eligibility may vary based on credit history, payment history, payment status, customer type and other factors. Two-year service agreement required. Upgrade fee, if not waived, of $18 applies. An early termination penalty of no more than $175 applies if service is terminated before the end of the contract term. If phone is returned within 3 days, upgrade fee, if applicable will be refunded. If phone is returned within 30 days in like-new condition with all components, early termination fee will be waived. Not all phones, such as iPhone, qualify for additional discount. Rate plan charge includes monthly charge and does not include usage charges. Data package charge includes monthly charge and does not include usage charges. Rate plan and data package charges are calculated based on the three (3) previous completed billing cycles. FamilyTalk® secondary lines do not qualify for the additional discounts. Any Mail-in Rebate or other discounts will reduce the additional discounts applied. Mail-in Rebate not available for iPhone. Additional discounts will not bring the price of equipment below $0. All other charges apply. Some dealers impose additional fees. © 2007 AT&T Knowledge Ventures. All rights reserved. AT&T and the AT&T logo are trademarks of AT&T Knowledge Ventures.

 

[tiiim]

Although i dont expect to be broken out of a 18 month contract (as a contract is a contract) one thing we can learn is roll on multiple carriers in the UK. At least it will keep the prices competitive, i think we can see why a monopoly is not good for the market. The prices of the iPhone 3GS+the higher than average tariff is not good in the UK. Unless something happens in the next few days I think I will wait till the 4th gen.

Also its not the end of the world as remember we get 3.0 upgrade which has majority of the features in the 3rd gen.. so everyone who is annoyed, yes the prices are silly but remember your phone does update itself which is something most phones dont do.

 

[AiralynRose]

i really dont understand why this is such an issue. With any other subsidized phone...if a newer model came out....you wouldnt just go to att and say...oh i have the old version of that...i would like the new one...please give it to me at that subsidized rate....

why are people all of a sudden shocked at this practice?

Agreed. Seriously people. Apple and AT&T went out on a limb last year and did something nice for you, that doesn't mean you get special treatment forever. If you buy a blackberry and there is a new model next year no one expects to be able to be the subsidized price on it again.

Honestly, I don't think they should have even let original iPhone users upgrade the last time if they got a subsidized handset (as backup or sold for cash)! If they hadn't got a subsidized one then they wouldn't have needed special treatment in the first place.

 

[DarkRail]

Clarity?

Some CLARITY from AT&T would be nice.

My dad and I both bought original iPhones on opening day 2007 (same store), then we both upgraded to 3G last September (same store). We have identical (but unconnected) contracts: same text, voice & data plans.

My price for 32gig 3GS: $499

His price for 32gig 3GS: $699

Are they just flipping a coin? Pulling numbers out of a hat?

Sure, AT&T are well within their rights to do this, but I say it's a bad business decision. Treat your existing customers really well, and they'll really want to stay around. AT&T's combination of terrible coverage and mystery fees makes me very anxious to jump ship the moment Verizon gets an iPhone.

 

[RestlessCaviar]

I agree that people should have to pay the subsidy part of their contract to upgrade early.

HOWEVER, O2 in the UK (& AT&T in the US) are asking for the subsidy PLUS the talk time. If you compare the £20 SIMplicity tariff (i.e. SIM only), which gives you 600 mins talk time, 1200 texts, and unlimited web bolt on, to the £35 3Gs iphone tariif, which has the same quotas, you can see that the £15 difference is the subsidy.

Therefore, if you have, say, 7 months left, you should be paying only 7x£15 = £90 to ‘pay off’ the remainder of the subsidy early.

To ask you to pay 7x£35 = £245 means they are effectively charging you a further premium of £155 to upgrade early, OVER AND ABOVE the subsidy.

I am currently not in contract, but I’m still not getting this new iphone, as I’d probably be in the same situation this time next year.

I’ll stick with my jailbroken 3G and await either sensible pricing from O2, alternative operators selling the iphone, or even going to the palm pre when it comes out.

 

[ts1973]

Welcome to the real world and out of the Apple reality distortion field.

I kind of hope the initial sale of the 3GS will be a failure, not because I don't want one, but because maybe, just maybe, Apple will realize that subsidized phones are no benefit to 90% of its customers (but only cost more in the end).

 

[iOrlando]

I went into an AT&T store this morning and asked the salesman what my upgrade options were for the 3GS. He told me that I could only get the unsubsidized prices for the 3GS if I wanted to get it on launch day. He also told me that I can only get the early upgrade pricing($399/$499) until July 11 (1 year after my purchase of the 3G).

He was looking at my account on his computer as he was telling me this.

if i am reading you right.....what happens after July 11?...you wont get the early upgrade pricing? or you will. and then july 11 2010 you will get the regular subsidized price.

 

[greenpaz]

And what about after the two years expires?

AT&T continues to charge the same monthly price even after the subsidized period is over. I know keeping the same rate is a smart business move, but should AT&T really be charging the same monthly rate for someone who has completed their two-year period and is using what is now at least a two-year-old phone?

BTW, I just signed up for the iPhone 3GS, and the AT&T rep says I might get the phone as early as this Friday (June 12) or the following Monday. Cool if it happens...

 

[skestes]

I posted this as it's own thread but I thought it might be more appropriate here.

The AT&T internal customer care manual:

http://consumerist.com/289663/internal-att-manual-for-handling-all-kinds-of-customer-complaints

 

[dwd3885]

i really dont understand why this is such an issue. With any other subsidized phone...if a newer model came out....you wouldnt just go to att and say...oh i have the old version of that...i would like the new one...please give it to me at that subsidized rate....

why are people all of a sudden shocked at this practice?

because Apple and ATT market and practice uses with this phone that they don't do with regular phones.

 

[johndoh]

Why the fuss?

Honestly, what planet have these whiners been on? Don't they know that the $299 is a deposit on the device, and then it is paid for over the term of the contract. How about I lease a car for 3 years today and get an "upgrade" in 12 months with no penalty (and I get to keep the old car)?

 

[nagromme]

AT&T (in the US) has paid most of the cost of our iPhones other than the 1st gen--and then we pay them back over time. I'd love AT&T to buy me (most of) a new iPhone right now, but until my two years are up, I do realize that I haven't yet even paid for the one I have I like the old NON-subsidized model just fine, but customers seem to like subsidies (in the US).

I have a long list of gripes with AT&T--and but this upgrade issue is nowhere near the top. (In fact, if you do qualify to pay $200 for an early upgrade, you're still not paying the full up-front retail price that the iPhone would otherwise have. You're getting a discount--it's just less of a discount because you still "owe" on your old iPhone.)

I'm amazed at how many people sign up for contract after contract over the years, and still don't understand WHY phones can be so "cheap" (or free).

As for me, I'm waiting for the iPhone 3Gav2 in 2010, with 64GB and front-facing camera. Every 2 years is enough for me.

AT&T continues to charge the same monthly price even after the subsidized period is over. I know keeping the same rate is a smart business move, but should AT&T really be charging the same monthly rate for someone who has completed their two-year period and is using what is now at least a two-year-old phone?
...

Now THAT makes my list of AT&T gripes So does their SMS policy, their tethering costs (for other phones), their customer service (especially re landlines and DSL), their delay on MMS and tethering... and that's about it I guess?

I supposed one way to look at the continued high price is that in return for the cheap phone you're giving them monthly fees that add up to some certain amount (the "real price" they've decided to charge). And that "real price" assumes SOME people will keep the phone longer than others. Replace your phone every 2 years and AT&T won't be as happy. (But Apple will!) Others will keep a phone for years. AT&T makes some average amount between those two groups.

Now, if that amount is unreasonably high, I cannot say. I'd certainly be glad to pay less Or at least throw in 200 MMS messages!

 

[stuarty2003]

I agree that people should have to pay the subsidy part of their contract to upgrade early.

HOWEVER, O2 in the UK (& AT&T in the US) are asking for the subsidy PLUS the talk time. If you compare the £20 SIMplicity tariff (i.e. SIM only), which gives you 600 mins talk time, 1200 texts, and unlimited wifi, to the £35 3Gs iphone tariif, which has the same quotas, you can see that the £15 difference is the subsidy.

Therefore, if you have, say, 7 months left, you should be paying only 7x£15 = £90 to pay off the remainder of the subsidy early.

To ask you to pay 7x£35 = £245 means they are effectively charging you a further premium of £155 to upgrade early, OVER AND ABOVE the subsidy.

I am currently not in contract, but Im still not getting this new iphone, as Id probably be in the same situation this time next year.

Ill stick with my jailbroken 3G and await either sensible pricing from O2, alternative operators selling the iphone, or even going to the palm pre when it comes out.

Unlimited WiFi is not the same as Unlimited WiFi/3G/Edge/GPRS. That's what the £15 is!

 

[Peace]

Welcome to the real world and out of the Apple reality distortion field.

I kind of hope the initial sale of the 3GS will be a failure, not because I don't want one, but because maybe, just maybe, Apple will realize that subsidized phones are no benefit to 90% of its customers (but only cost more in the end).

AT&T and Apple will fail with this new iPhone and not just because of the lack of discounts for iPhone 3G users. But also because of the lack of MMS.

And it won't bother me one bit.

 

[bretm]

Has anyone heard of exceptions? I'm talking about early upgrade from a NOKIA-my son has NEVER had an iPhone. You'd think they'd want the higher monthly income...

A few months ago I went to the ATT store because my sim card died. I have an original iPhone, not a 3G. The guy at the ATT store it turned out used to work at an Apple Store so seemed to have much more experience than the typical ATT sales person. Anyway he saw that ATT had not remove a monthly text charge from before I had an iPhone so I was immediately credit about $150. COOL! But if I hadn't gone in.......??? OUCH!

Anyway I'm ready to upgrade to a 3GS for 199. but I also want to get my son his first iPhone. Online it shows he won't qualify until next April for the subsidized rate (from a Nokia).

Has anyone heard that if you go in the store and buy two they ever make an exception? It would seem since he never had an iPhone they would want the larger monthly bill. Im not talking about upgrading from a 3G or any other iPhone

Exceptions ever?

Sure they want the higher rate. But the higher rate ain't all profit. I'm sure your son got a cool free Nokia. It too was subsidized. Probably cost them 200-300 dollars. But just like any other customer they can't do that because if they did that every 6 months the higher monthly plan would be meaningless because they're in the hole.

 

[ipoppy]

A very nice customer service rep at ATT advised me that they are able to override any upgrade restrictions except for the iphone. She tells me that apple imposed this restriction on them. Not to sure if this is true but this is what she was told.

Come on Its diplomatic talk from AT&T to blame someone else. How Apple can loose if AT&T will let you upgrade? Another handset sold; no way Apple imposed any restrictions.

 

[joev]

The outrage in the UK isn't over those who are still in contract (well, some of it is, but not the part that really has a point).

It's that O2 have DOUBLED the price of an iPhone 3GS over the 3G at it's launch despite the US prices being exactly the same for people who aren't in any sort of contract.

And the crazy tethering prices.

Phazer

QFT.

I think it's time to make a complaint to the Trading Standards Authority and the Advertising Standards Authority about advertising "unlimited" 3G data access (which actually means 250MB/mth otherwise they cut you off as an "unfair user") and then gouging £15/month for using it.

O2 have always been the worst carrier in the UK, exhorbitantly pricing their (shoddy) services. They do more to damage Apple's reputation (by association) than anything Microsoft could ever do.

How Apple can still be in bed with them is beyond me but I predict they'll come to regret it. O2's pricing, flaky network and poor service is going to kill the iPhone market in the UK (the biggest Mobile market in Europe)... perhaps they make better margins on the Palm Pre deal?

 

[fastbite]

I've been there from the beginning. I want. But o2 is just a...

[image removed by moderators]

 

[bretm]

AT&T and Apple will fail with this new iPhone and not just because of the lack of discounts for iPhone 3G users. But also because of the lack of MMS.

And it won't bother me one bit.

MMS is going to be here in a few months. I'll blink and it will be here. We'll all have forgotten you're angry about something, well... now.

 

[Orng]

Hey, did I just read that O2 is trying to avoid having "distinct set of business terms for iPhone customers that don't apply to our other customers" ?

That's what I thought it said.

That's some crazy thinking over there, treating iPhone customers the same as other customers.

Here in Canada, if you want an iPhone, you're telling the world that, in exchange for the best phone, you're willing to let Rogers screw you over with a different, and entirely more appalling, set of restrictions than the ones they impose on their less flashy customers.

Rogers despises us all, but they reserve the most foul, dripping hate for iPhone owners.

 

[nemaslov]

they better figure out a deal for all of us 3G users!

Why!? You probably got a cheaper phone since ATT PAID FOR PART OF IT FOR YOU. They SUBSIDIZED your purchase and you agreed to stay with them for a given period. When that period of time os over you can do what you want and get another SUBSIDIZED iPHONE.