Sue?! You want to sue a company because they provide a service that people are happily willing to pay for?
I'm gonna Legos because their Ultimate Collector's Millennium Falcon is $500! It's just plastic!
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really starting to reconsider based on AT&T's plans
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Sue?! You want to sue a company because they provide a service that people are happily willing to pay for?
I'm gonna Legos because their Ultimate Collector's Millennium Falcon is $500! It's just plastic!
Paying extra for something that works better is a little different from paying extra for stuff that, eh, works. I keep hearing things about cell phone call quality sounding better, and it still sounds like good ol' 4kbps phone audio to me. If you've ever used any sort of VoIP (me, through AIM and Yahoo Messenger), it leaves a lot to be desired.
This is a good time to perhaps force cell companies to make their rates a little more sane. No, AT&T isn't charging any more than the other companies for stuff. But most places around here are charging circa $3.95/gallon for gasoline. Just because everybody's doing it doesn't make it something we like.
You saw what happened when Verizon came out with a $99 unlimited plan. AT&T matched it. Now if someone would jack down their monthly plans and their data plans, maybe it would force everybody's hand. There are at least 4 big players here in the US (AT&T, Verizon, Sprint/Nextel, T-Mobile) and a handful of smaller guys. Yet it's those bloody Europeans getting their free iPhone deals. ARRGH!
Agreed. I'm glad I don't text. One of my calc students last semester texted me and I didn't know wtf to do.
SMS is to the cell phone industry as soft drinks are to restaurants. I wouldn't send them if not for the free 200 I have. Seriously, EVERYBODY should get 200 free. There will still be money to make on the 15-year-olds that must text each other 15 times/minute.
General question. Do incoming SMS cost or count towards the number? I think Sprint does. So would I have to pay when someone texts me?
i wouldn't care one way or the other about the SMS costing extra if i could dump the (for me) completely unneeded data plan.
SMS is a big money cow for the cellular phone industry. Since it is unregulated, they can charge what the market will bear. Interestingly, that is now approaching 20 cents a text. That's 20 cents a text for both the sender and the receiver. Since the text probably costs about 1/20 of a cent to deliver, that is basically all profit. It probably costs more to do the accounting and bill you than the actual message. In the rest of the world, there is caller pays, which basically means that you don't pay to receive texts or phone calls. Not so in the US. Of course, we also have unlimited local calling from landlines which is unheard of in most of the world...
The real interesting thing about the AT&T/iPhone2 deal isn't the offense of the increased prices, it is why the increased price is necessary. Under the old Apple/AT&T deal, Apple sold you a phone at full price, you got a good price on phone service with SMS, voice and unlimited data, and Apple got a kickback on the service from AT&T to the tune of $10-$20/month. The advantage to AT&T was that they didn't have to subsidize the phone and Steve Jobs would market for them with the latest hot, must have product from Apple.
Now, with iPhone2, AT&T doesn't have to give Apple $10-$20/month, although they do have to give Apple a couple hundred up front for each handset (the subsidy). They have gone and added an ADDITIONAL $15/month onto what they were already collecting. So, do the math:
New iPhone $299
AT&T subsidy to Apple - $200 (approx)
New, minimum, monthly increase in revenue for AT&T - $20
Break-even point on subsidy - 10 months, max. (less if you add $5 SMS plan)
If AT&T kept the existing payment plan, they would probably see pressure from their other handset manufacturers to match the Apple price point (probably another significant reason for raising charges for iPhone) to there would be a fair playing field. However, they would hit their breakeven point in no more than 20 months, still better off than before where all that money was flowing to Apple.
The price-supply-demand equation is particularly interesting on this offer because both companies feel like they come out ahead. Clearly, AT&T is applying their regular business model and looking to attract customers who are locked into their service via the iPhone. They take a charge in the short-term, but they are counting on gaining new subscribers (which is harder to do now) and locking in a loyal, higher-paying clientele for years to come. Apple has figured out that the strategy of "devaluing" their iPhone handset by allowing AT&T to subsidize the cost will actually spark a lot more sales and they will blow through their 10 million unit prediction with a lower priced handset without really impacting their business model revenues for current or future earnings (they make up for lost revenue sharing with AT&T in the volume of sales). Consumers, behaving somewhat irrationally, will fund the whole enterprise, buying loads of iPhones at a lower cost of entry, but locking themselves into costs that are actually hundreds of dollars more over the life of their contract.
The real interesting thing about the AT&T/iPhone2 deal isn't the offense of the increased prices, it is why the increased price is necessary. Under the old Apple/AT&T deal, Apple sold you a phone at full price, you got a good price on phone service with SMS, voice and unlimited data, and Apple got a kickback on the service from AT&T to the tune of $10-$20/month. The advantage to AT&T was that they didn't have to subsidize the phone and Steve Jobs would market for them with the latest hot, must have product from Apple.
Now, with iPhone2, AT&T doesn't have to give Apple $10-$20/month, although they do have to give Apple a couple hundred up front for each handset (the subsidy). They have gone and added an ADDITIONAL $15/month onto what they were already collecting. So, do the math:
New iPhone $299
AT&T subsidy to Apple - $200 (approx)
New, minimum, monthly increase in revenue for AT&T - $20
Break-even point on subsidy - 10 months, max. (less if you add $5 SMS plan)
If AT&T kept the existing payment plan, they would probably see pressure from their other handset manufacturers to match the Apple price point (probably another significant reason for raising charges for iPhone) to there would be a fair playing field. However, they would hit their breakeven point in no more than 20 months, still better off than before where all that money was flowing to Apple.
The price-supply-demand equation is particularly interesting on this offer because both companies feel like they come out ahead. Clearly, AT&T is applying their regular business model and looking to attract customers who are locked into their service via the iPhone. They take a charge in the short-term, but they are counting on gaining new subscribers (which is harder to do now) and locking in a loyal, higher-paying clientele for years to come. Apple has figured out that the strategy of "devaluing" their iPhone handset by allowing AT&T to subsidize the cost will actually spark a lot more sales and they will blow through their 10 million unit prediction with a lower priced handset without really impacting their business model revenues for current or future earnings (they make up for lost revenue sharing with AT&T in the volume of sales). Consumers, behaving somewhat irrationally, will fund the whole enterprise, buying loads of iPhones at a lower cost of entry, but locking themselves into costs that are actually hundreds of dollars more over the life of their contract.
Wow, didn't realize that the $30/month didn't include texts. Another reason why I wish this whole subsidy thing didn't happen. I would so much rather pay more upfront than get nickeled-and-dimed over the course of 2 years. And before some JA tells me to get a better-paying job, that's not the point. I just think its so lame that the iPhone 3G is being portrayed as half the price of the first gen, when it clearly isn't.
If you need to text, then get a FRCKNG Text Message Plan and stop whining about it !
Not quite. SMS uses a different type of channel, a signaling channel, mainly used to send out the phone numbers when you call someone. This is a much slower channel than the ones used for 3G data, and has to stay that way to be backward compatible with zillions of old phones, so they have to keep raising the price to keep the kids from clogging it up so badly that no one else can dial out when they need to. If you want bandwidth, use push email over 3G instead.
They have all kinds of pricing plans for SMS messages to fit all different kinds of usage that are cheaper.
for just $5.00 a month you can get text messages as cheap as 2.5 cents each, and it only gets better from there.
If you do not text much, then yes, you will pay 10 cents each, but since you don't text much, it is probably going to be less than $1-$2 a month, so not something to be getting bent about.
are you serious? although cheaper and a great deal, I don't think $20 for a data plan w/ 200txt (in which AT&T charges an additional $20 for unlimited txt) qualifies as "nothing."
all salient points, man. maybe all the scrutiny the media is putting on AT&T and apple these days regarding their "bate-and-switch" business tactics would indeed force the hand of AT&T to make a change. but then again, it does seem to be true that AT&T hasn't officially announced anything about the 200txt being included w/ the data plan or not. I keep reading of ppl calling in and the service reps tellin ppl that 200txt is actually included, in which case all this would be moot.
I mean these new rates wouldn't hurt me financially, but really AT&T? really!? c'mon. even with all the talk about how awesome 3G is gonna be, new subsidized phone prices, just paying the same amount as blackberry users now, etc, etc (although I do agree w/ some of the points), I still can't see a phone plan which barely includes 450 anytime mins and no txts warranting an $80+ price tag ya kno?
but whatever happens, I'll be rockin the white or black 16GB come july 11th =).