After WWDC by Apple, showcasing their latest addition to the iPhone family, the iPhone 3GS, AT&T announced it will be rolling out upgrading pricing for consumers who want to upgrade from the iPhone 3G to the iPhone 3GS.New AT&T customers will be able to purchase the new iPhone 3GS for $199 for 16GB and $299 for 32GB model in either black or white, while current AT&T customers will need to pay double that just to upgrade from the 3G to 3GS. Pricing for the upgrade will cost $399 for the 16GB and $599 for the 32GB model. The reasoning behind his is that AT&T subsidized the pricing of the original iPhone, but not the iPhone 3G, which gave them the ability to sell the device at a lower price and lock users into a two-year contract. However, this change has sparked outrage in many AT&T customers, already creating petitions, spreading word through Facebook and Twitter.
The angry consumers have a good reason to be, after AT&T announced it won't be supporting MMS or tethering when iPhone 3GS releases and has said customers will simply need to wait for their infrastructure to support it, or pay an additional fee.
One outraged customer even wrote about stopping payment to AT&T until they agree to lower the upgrade pricing:
"For those loyal AT&T customers, remember to change your account setting to stop all automatic payments to AT&T before getting the new phone. It is your money, AT&T has no rights to steal from you unless you are satisfied with the service they promised to provide. This should be a fair business trade, not a robbery," Agent Provocative wrote.
While this practice is somewhat standard in US cell phone sales, this change from the previous iPhone upgrade program could backfire for new customers, if Apple releases a fourth generation iPhone next year, as they have been releasing a new iPhone every year for three years now.
AT&T wireless has only been around for 2 years.. thats BS
AT&T Wireless has been around for a long time. I've had them since the late 90s. There was a time when it was changed over to cingular for a year or two after the buy out, but the name was changed back AT&T.
Oh.. did not know that.. I take back what i said then..
Though supposedly the new AT&T Wireless is just a renamed Cingular, they sure do seem to be reincarnating the dark lord of cellular day by day these days. 8P
the phone does not cost 199. it costs 599. you get it for 199 with a two year subsidy. if you dont use the phone for two years, you have to pay more to upgrade. the thing is they are mad that they are paying 399 for the 16 gig phone, but thats what they should be paying to get it without a contract. All this stuff is propagated by people who are too dumb to know what they are signing. Or people that think they can get away with it.
The petition will not work. B/c At&t doesn't care b/c even if people stop paying At&t, they lose their service. And At&t will charge them all the money they owe, plus the early termination fee, so they end up paying the same price as they would for the new iPhone plus they have bad credit.
Good idea.
the phone does not cost 199. it costs 599. you get it for 199 with a two year subsidy. if you dont use the phone for two years, you have to pay more to upgrade. the thing is they are mad that they are paying 399 for the 16 gig phone, but thats what they should be paying to get it without a contract. All this stuff is propagated by people who are too dumb to know what they are signing. Or people that think they can get away with it.
The petition will not work. B/c At&t doesn't care b/c even if people stop paying At&t, they lose their service. And At&t will charge them all the money they owe, plus the early termination fee, so they end up paying the same price as they would for the new iPhone plus they have bad credit.
Good idea.
+1
If that doesn't solve the problem I don't know what would.
The problem is if iPhone 3G owners upgrade and trade-in their old 3G phones, there is no place AT&T can dump those old phones. It has enough of those phones from people returning within 30-day period and being resold as "refurbished". Apple isn't helping by taking those phones back either and so AT&T is just caught right in the middle. AT&T is just the poor guy with the mess while Apple is laughing all the way to the bank.
For example, I'm with AT&T now. New customers get the phone for $199. I can get the phone for $299 as I'm a 'valued customer' and meet the year or so requirement.
If the original 3G cost $699 MSRP, then in a little over a year, they've made the $400 difference due to subsidizing ($500 original subsidized cost - $100 for the 'extra' upgrade fee I can pay).
So that means that the effective $400 subsidized price (which is really less as the MSRP is $699, that's not what AT&T is paying per phone) is made up within the first year to year-and-a-half of my contract.
AND this assumes that AT&T is only making money on my contract after a year into my contract. Now, they might not really make any money until 6 months into my contract, or maybe even 9 months... but there's no way I'm going to believe that after 9 months they aren't turning a profit on me.
So yeah, I blame AT&T for their crap service, their horrible prices, and their big F-YOU to its customers.
For the new 3G S phones, you and I will upgrade for $399 (16GB) and $499 (32GB), which are just $199 and $299 for new customers.
So in all cases, the "extra" upgrade fee is $200. And this upgrade requires us to be at least 1 year into our existing contract, which means AT&T has already recovered half of the $500 it paid Apple.
I don't disagree with you on AT&T's service. It is just average. For better service, Verizon is the best but it is also the most expensive. So we get what we pay for.
In any case, as far as where that "upgrade" fee goes, it does go to Apple and not AT&T. That's how the math works. Wish Apple is more transparent in their pricing.
For the new 3G S phones, you and I will upgrade for $399 (16GB) and $499 (32GB), which are just $199 and $299 for new customers.
So in all cases, the "extra" upgrade fee is $200. And this upgrade requires us to be at least 1 year into our existing contract, which means AT&T has already recovered half of the $500 it paid Apple.
I don't disagree with you on AT&T's service. It is just average. For better service, Verizon is the best but it is also the most expensive. So we get what we pay for.
In any case, as far as where that "upgrade" fee goes, it does go to Apple and not AT&T. That's how the math works. Wish Apple is more transparent in their pricing.
You're right... I read the 'valued customer' upgrade notification incorrectly. It is $399 and $499. Not really sure why the old model was given as something I can upgrade to as I have that phone...
But that just makes my point even stronger as it's only $300 they need to make up. I still think they are caring more about profits than customers.
After all, having the NEW features is part of the status symbol...
"For those loyal AT&T customers, remember to change your account setting to stop all automatic payments to AT&T before getting the new phone. It is your money, AT&T has no rights to steal from you unless you are satisfied with the service they promised to provide. This should be a fair business trade, not a robbery," Agent Provocative wrote.
This statement confused me. Why does this guy feel that AT&T is required to give him a cheap upgrade deal? And why is he giving people super stupid advice? Telling them to stop paying for service they have contractually obligated themselves to pay for? Seems really stupid...
I think the author should add a minor note to let people know they face some severe penalties listening to that guy...
As far as MMS goes I've never needed it and have not missed its absence in the time I've had an iPhone. I really don't see what all the fuss is about with that one feature. If I want to send a picture with my message an email serves just fine. Like others have said, I signed a contract and knew what I was getting into. I have no beef with AT&T and wouldn't switch even if I did have a beef since they have the best coverage where I live.
They don't make back their HUGE future planned PROFIT if you terminate before 24 months...
Which is, after all, why they did this horrendous bundling deal with Apple in the first place -- to fleece the golden sheep who have proved so woolly for Apple in the past.
Unfortunately this is the road many businesses seem to be taking, offer unbelievable deals to new customers, treat there existing/loyal customers like crap, when they lose an existing/loyal customer, offer them something unbelievable to come back. Its been going on for years, I would of thought people got used to it by now, clearly not.
Last edited by TSO on 11 Jun 2009 - 07:19
Unfortunately this is the road many businesses seem to be taking, offer unbelievable deals to new customers, treat there existing/loyal customers like crap, when they lose an existing/loyal customer, offer them something unbelievable to come back. Its been going on for years, I would of thought people got used to it by now, clearly not.
There's always hope for a change right? I mean... come on... do I really need to pay $70+ for phone service when my house phone is only $99/yr. Something doesn't add up there.
Well yes but this is a common argument and many people who make it seem to think that the network is going to conveniently "forget" that their still ties in for a year (and paying money BACK for their original subsidy) the only way the network can actually make any money out of doing this is to add the original remaining contract length onto the new 2 year deal.
You start finding issues with locking in customers for 3 or 4 years particularity when the next shiny Jesus phone comes along and the issue starts again.
The other way is to charge the the line rental again 9 effectively doubling their line rental for a year ) then dropping back. People will have issues with this too as they all expect to get something for nothing.
Unfortunately this is the road many businesses seem to be taking, offer unbelievable deals to new customers, treat there existing/loyal customers like crap, when they lose an existing/loyal customer, offer them something unbelievable to come back. Its been going on for years, I would of thought people got used to it by now, clearly not.
That 2 year contract will now help pay back the subsidized loss on the 2nd iPhone. Not the first and second. This is the point that people AREN'T understanding. Each iPhone is subsidized so AT&T and Apple technically sell them at a loss. Through apps and contracts, they get their money back. What is so difficult to understand?
And actually Apple is really behind. My 3-year-old-very-low-budget Sony-Ericsson has always supported MMS and Tethering, just like basically any Sony-Ericsson.
I live in the uk btw
I hope they give you a refurbished 3G as a replacement...
False.
It's the other way around. 3G was subsidized and the original one was not. This is why the original iPhone users were able to get the subsidized price for the 3G, because AT&T did not already give them $200...
I have the iPhone Gen 1.. really not even bothered about the whole 3G thing. Is it worth getting this phone just cause of the faster speeds they boast about?
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