Is the $200 a subsidy?

Discussion in 'iPhone' started by ramblintoad, Jun 9, 2008.

  1. ramblintoad macrumors member

    Jun 9, 2008
    I returned my first gen iphone today since I bought it 11 days ago, and when I was asking the store clerk there she mentioned that the $200 price is probably a subsidy, so I would have to wait until I can upgrade my plan. Is this true, or did she not know what she was talking about?
  2. JBaker122586 macrumors 65816

    Jun 21, 2007
    It is technically a subsidy, but it's automatic for anyone signing up for a new iPhone contract. There is no way to get the phone "unsubsidized."
  3. djransom macrumors 68040


    May 14, 2008
    It's NOT a subsidy. It's the RETAIL pricing as said by Jobs in his keynote.
  4. Goliath macrumors regular


    Jul 28, 2004
    So a 3G iPhone with aGPS costs $199 and that price isn't subsidised somehow! Wow they're really ripping us off on the iPod Touch and iPod Nano then
  5. Me1000 macrumors 68000


    Jul 15, 2006
    There is no way this isnt a subsidy!

    The only reason to force the signing of a contract before you leave the store would be because AT&T is giving apple the other $200 they are loosing from the initial sale! If people were able to take the phone home and unlock it Apple would loose money!
  6. gkarris macrumors 604


    Dec 31, 2004
    "No escape from Reality..."
    Yes, NO WAY is a next gen iPhone with extra features only $200.

    Anyone that believes otherwise is a total moron..
  7. benlee macrumors 65816


    Mar 4, 2007
    I agree. This is the way Apple is doing it now. If they want compete with RIM they have to go head to head. The only difference between this and a regular "subsidy" is that the first iPhone was special (in its pricing) and this phone is going a more traditional pricing route. So they have to give the new iPhone for that price to existing owners, new customers, and those eligible for an upgrade. (Maybe those ineligible for upgrade will get the pricing too) Its all to get you to pay them at least $80 a month. They could give it away for free and still make money.

    In short, YES.
  8. Sun Baked macrumors G5

    Sun Baked

    May 19, 2002
    I though he said we worked with the carrier to bring you the phone at a lower price.

    Is Apple including the entire subsidy they get from AT&T in the price, maybe, maybe not.

    Don't know.

    May be more up front with the new deal and the dropping of the old AT&T contract revenue sharing.

  9. mntentman macrumors regular

    Jan 15, 2007
    Read the press release on the AT&T website. They clearly state this is "subsidized pricing."
  10. DreamPod macrumors 65816


    Mar 15, 2008
    It's...not quite a subsidy. In fact, it's kinda the opposite - Apple used to charge AT&T $200 for each iPhone sold, but with the 3G iPhone, they aren't. So really it's just a cheaper phone. Having said that, it's impossible to buy one without signing a 2 year contract, just like the old iPhone.
  11. kdarling macrumors P6


    Jun 9, 2007
    First university coding class = 47 years ago

    "The new agreement between Apple and AT&T eliminates the revenue-sharing model under which AT&T shared a portion of monthly service revenue with Apple. Under the revised agreement, which is consistent with traditional equipment manufacturer-carrier arrangements, there is no revenue sharing ..."

    "In the near term, AT&T anticipates that the new agreement will likely result in some pressure on margins and earnings, reflecting the costs of subsidized device pricing, which, in turn, is expected to drive increased subscriber volumes."

    Apple has gone to what they originally made fun of: The traditional phone pricing structure.
  12. nateco macrumors regular

    Sep 5, 2006
    I plan on moving to a out of range location to get out of the contract.
  13. Niiro13 macrumors 68000

    Feb 12, 2008
    Yeah, you go on believing that...until July comes and they tell you that it costs $399 and $499 and that you're getting your rebate when you activate...

    Btw, my statement above pretty much argues it as a base price. Its a subsidy cause its technically $399. But its base price cause you can't buy it without signing the contract. Its just like all the other 2 year contract phone prices.

    But if you ask att whether its base price, they should tell you base is $399. Just its an instant rebate.
  14. nateco macrumors regular

    Sep 5, 2006
    I'd be ok with 399 if I didn't need a contract....canada is looking three years
  15. GFLPraxis macrumors 604


    Mar 17, 2004
    There's got to be a way to get my hands on an iPhone without getting a contract. I wonder if the cancellation fees would be over $200...if not I would just buy an iPhone and cancel and it'd be like buying the old iPhone.

    My current iPhone is on T-Mobile.

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