AT&T to subsidize $200 of cost of new iPhones?

Discussion in 'Apple' started by BrianShort, Apr 29, 2008.

  1. BrianShort

    BrianShort Supporting Actor

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    According to this story at CNN.com (http://techland.blogs.fortune.cnn.co...s-new-iphone/), AT&T is planning on subsidizing up to $200 of the cost of the new 3G iPhones rumored to be announced in June. This would mean a brand new iPhone for only $200 (with a contract of course). As someone who was planning on buying one of the new iPhones anyway, this gets a huge thumbs up from me [​IMG]

    Brian
     
  2. ErichH

    ErichH Screenwriter

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    Brian - These rumors are getting silly. According to the post, you can't get this deal at Apple stores, only AT&T with a 2 year contract.

    Would Apple offer a shorter term to balance or choke availability at AT&T stores? Perhaps it's a down the road plan after the initial run in June-November.

    I doubt either when demand is so high.
     
  3. DaveF

    DaveF Moderator
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    Aren't iPhones selling like hotcakes at $600? Aren't they reported to be in short supply? Why would they offer a $200 subsidy on a high-demand item?

    I can't fathom it, unless ATT thinks the early adopter market is satisfied and must now target the cheapskates (like me) looking for a low price, high-featured smartphone.
     
  4. Christ Reynolds

    Christ Reynolds Producer

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    I would imagine they are still selling well, but the iPhone is no longer $599, it's $399 or $499.

    CJ
     
  5. Ted Todorov

    Ted Todorov Cinematographer

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    The author of this rumor, Scott Moritz has been repeatedly and woefully wrong about the iPhone at TheStreet.com, I see no reason why his record should improve at Fortune.

    Nothing to see here, move along.
     
  6. John Mansor

    John Mansor Stunt Coordinator

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    Seriously!!! How do these analysts keep their jobs??
     
  7. ErichH

    ErichH Screenwriter

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    I'd think Apple loves all the rumors to a point - free marketing.

    Until His Steveness takes the stage with Jesus2, have at it [​IMG]
     
  8. BrianShort

    BrianShort Supporting Actor

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    How does one get a job as an "analyst" anyway, and what is their major job function?

    iPhones haven't been $600 for awhile. I'll be perfectly happy paying $400 for an 8 gig (or hopefully a 16 gig), when the 3G comes out though.
     
  9. Sam Posten

    Sam Posten Moderator
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    What you have to realize is that a BIG chunk of the iPhones are never registered at AT&T. The ONLY way you would get this $200 is via a rebate for signing a contract. So all the ones that are getting shipped to the former USSR etc are going to still sell for full price and if you walk in and buy them at the Apple store SteveJ and crew get your cash but AT&T still gets nada.

    Regardless of price I'm in line for a 3G iPhone on day 1, and I skipped the first gen.
     
  10. Joe Cortez

    Joe Cortez Stunt Coordinator

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    Same here and I hope they finally add MMS and video capturing to the second gen's specs as well.
     
  11. ErichH

    ErichH Screenwriter

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    Me 3

    2.0 software might be more interesting than the device.
     
  12. Sam Posten

    Sam Posten Moderator
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    I'm not holding my breath for any specific features. That is a recipe for disaster with Apple. Remember Apple survives by selling products that are 'just good enough'. Even the mac pros have their failings and most owners have a line item or two that they silently wish 'If only'...

    Apple sez: Always leave em wanting more. And then give em part of it on the next rev but leave something else out that they are going to want.
     
  13. Michael_K_Sr

    Michael_K_Sr Screenwriter

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    As someone else mentioned, any rebate would be a way for AT&T to lock in a user for two years and guarantee that revenue stream. They get zilch from people that buy the phones and unlock them. Apple would stand to benefit as well, given that they have a revenue sharing agreement that nets them a portion of each AT&T iPhone user's monthly fees. Although the cheapest monthly voice and data plan now runs $60/month, I wouldn't be surprised if the pricing is at least slightly higher on the new phones, given that they'll be marketing AT&T's high speed data network
     
  14. DaveF

    DaveF Moderator
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    That's an odd way to look at it. Apple succeeds by selling products that are superior in style and usability to the competition. (and with feature sets that are on par, or exceed, that competition) (Every product leaves owners with an "if only"; that doesn't mean they're "just good enough")

    What may happen -- but I'm still doubtful -- is that AT&T wants to both increase market share and to capture some of the unlocker group by sacrificing up front revenue with this rebate. And what's $200 when you'll make it up in a few months of normal billing.

    But, in this scheme, Apple plays no part in it. The rebate is fully AT&T's doing: they'll eat the whole of it, paying Apple whatever they pay now for the hardware. Apple will not see a decrease in their hardware income from AT&T's rebate.
     
  15. Sam Posten

    Sam Posten Moderator
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    I disagree Dave. Apple's products have high quality look and feel at the detriment of high end components and customization. This is true of almost every part of their product line up. Most consumers are quite willing to give up performance for stability and style, even me. That doesnt keep me from grumbling that what is available is overpriced and underspecced.
     
  16. Ted Todorov

    Ted Todorov Cinematographer

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    The thing is, I suspect that the proportion of unlocked iPhones being used domestically is pretty tiny. So far as all those being shipped to Russia, Africa, Europe and beyond AT&T isn't going to get them to sign up no matter what subsidy they offer. Secondly Apple wouldn't want it for fear of devaluing its iPods, particularly the touch.

    Unless the 3G iPhones ship unlocked by default (doubt it, in a big way), it is a nonsensical rumor.
     
  17. DaveF

    DaveF Moderator
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    We'll have to disagree. Apple is not perfect, but the phrase "just good enough" suggests mediocrity, a bare minimum of features. I think it's safe to say that is not how the majority of Apple's customers view its products.

    The iPhone is more than barely adequate (to its owners*). And it clearly sets new feature standards; all other products trail it in certain areas (e.g. UI, browser, music playback).

    *To me it is not yet adequate, lacking 3rd party apps. When SplashID is available on it, it will be an item of lust to me [​IMG]
     
  18. ErichH

    ErichH Screenwriter

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    The revenue share across all these new countries (what 20-30 or so this summer) might be a moot point. With numbers that large for V2, Apple can do quite well on hardware profit alone. In places like the US & UK where they do achieve share, they can keep the hardware price low. Where there's more risk, the export price goes up.

    With so many announcements for June/July in so many countries, I get the feeling there will be a buy button on June 9 in the US. I'm ready.

    T minus 28
     
  19. TonyD

    TonyD Who do we think I am?
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    i have an 8g iphone i bought a couple weeks after it came out.

    i still have 1 year left on the contract so without paying the $180 out and the price of a new iphone i guess i'm waiting 'till next year.

    [​IMG]
     
  20. Ronald Epstein

    Ronald Epstein Administrator
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    I would think that if AT&T does subsidize the cost of the new
    iPhone that those now under contract will simply have that
    contract "extended."
     

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