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You are here: MacNN Forums > Hardware - Troubleshooting and Discussion > iPhone, iPad & iPod > IPhone/AT&T Contract makes no sense...

IPhone/AT&T Contract makes no sense...
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RIRedinPA
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Jul 7, 2008, 01:53 PM
 
According to AT&T, if you are a new customer they will subsidize the $599 3G iPhone (8GB) for $400, making it's cost for you $199 plus a two year contract. However, if you're an existing AT&T customer they will only subsidize the phone for $200, making your cost $399, but you wipe the slate clean on your existing contract and still have to take out a new two year contract.

Maybe I am misunderstanding this:

http://sanjose.bizjournals.com/sanjo...html?ana=yfcpc

Seems like AT&T is giving a big middle finger to their existing customers. I'd be fine with the $399 if I didn't have to sign on for another two years at a contract that is actually less than what I have now (they are also raising the min. contract rate by $10 a month and dropping unlimited texting). It's like AT&T saw me across the prison yard and said, there's my bitch for the day...

I already have an iPhone, was going to get my wife a new one but not now. Might even unlock the one I have, cancel the AT&T contract and jump ship.
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iamnotmad
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Jul 7, 2008, 02:00 PM
 
it's always that way. New customers have the advantage when switching from any carrier to any other carrier.

Edit - not saying thats ok, it sucks, and is lame.
     
Dakar the Fourth
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Jul 7, 2008, 02:02 PM
 
Doesn't this mean that if your early termination fee is under $200, you're better off getting out and returning as a new customer -- if it's possible to pull that on them.
     
ort888
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Jul 7, 2008, 02:08 PM
 
Yeah, the subsidization math doesn't really add up. By selling a no-contract $599 iPhone, they are basically admitting that iPhones cost $599 with no subsidy. Yet they have sold for $200 less then that for about 9 months... which would imply that current iPhone owners have been receiving some form of subsidization... yet, current iPhone owners can get the the $199, while current AT&T customers with cheapy free phones, are being forced to pay an extra $200 for??? What exactly?

It almost feels like AT&T is just making up a bunch of numbers.

I think the bottom line is that I have yet to hear a single positive thing about these AT&T plans. Opinions range from "sucks, but thats how all cell companies are" at the top, all the way down to pure outrage.

AT&T pretty much completely screwed this one up. Apple screwed up too, by allowing it to happen.

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ort888
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Jul 7, 2008, 02:11 PM
 
Originally Posted by Dakar the Fourth View Post
Doesn't this mean that if your early termination fee is under $200, you're better off getting out and returning as a new customer -- if it's possible to pull that on them.
Yeah, I'm going to go in there a few weeks from launch and start working them over. I'll get that damn $299 16gig iPhone if it kills me.

I've been a customer for 6 years and was promised that subsidized price twice on the phone and they have it on record. Since the cost of getting out of my contract is less then the difference between the subsidized and non-subsidized price, I think I at least have the beginning of an argument. Not to mention the $6,000 I've given them as a loyal 6-year customer.

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mduell
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Jul 7, 2008, 07:55 PM
 
AT&T has figured out what various groups of people are willing to pay, and they're charging them that.

iPhone users are already AT&T users and only getting a marginal upgrade (3G/GPS and battery life), so AT&T doesn't figure they're willing to spend much, thus the $200 price. Non-AT&T customers are more valuable than existing customers because they add to the customer pool instead of just maintaining it, so they get a lower price. Getting new customers is expensive for cellular companies; last time I read the average cost of obtaining a customer was ~$400 (marketing, retail, phone subsidy, initial support).
     
MacosNerd
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Jul 7, 2008, 09:02 PM
 
Originally Posted by ort888 View Post
I've been a customer for 6 years and was promised that subsidized price twice on the phone and they have it on record.
No offense but just because they/you have it on record doesn't amount to a hill of beans. If want to squeeze every penny out of existing customers then you'll not see the subsidized cost.
     
RIRedinPA  (op)
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Jul 8, 2008, 11:44 AM
 
Originally Posted by mduell View Post
AT&T has figured out what various groups of people are willing to pay, and they're charging them that.

iPhone users are already AT&T users and only getting a marginal upgrade (3G/GPS and battery life), so AT&T doesn't figure they're willing to spend much, thus the $200 price. Non-AT&T customers are more valuable than existing customers because they add to the customer pool instead of just maintaining it, so they get a lower price. Getting new customers is expensive for cellular companies; last time I read the average cost of obtaining a customer was ~$400 (marketing, retail, phone subsidy, initial support).
You got it backwards, new customers pay $199 for an iPhone, existing customers (not sure if it matters whether you have an iPhone or not) pay $399. On top of that, existing customers have to scrub their contract and sign a new two year deal which is $10 more for data and does not include unlimited texting.
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RIRedinPA  (op)
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Jul 8, 2008, 11:45 AM
 
Originally Posted by ort888 View Post
Yeah, I'm going to go in there a few weeks from launch and start working them over. I'll get that damn $299 16gig iPhone if it kills me.

I've been a customer for 6 years and was promised that subsidized price twice on the phone and they have it on record. Since the cost of getting out of my contract is less then the difference between the subsidized and non-subsidized price, I think I at least have the beginning of an argument. Not to mention the $6,000 I've given them as a loyal 6-year customer.
Good luck with that.
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scottiB
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Jul 8, 2008, 12:27 PM
 
Originally Posted by RIRedinPA View Post
You got it backwards, new customers pay $199 for an iPhone, existing customers (not sure if it matters whether you have an iPhone or not) pay $399. On top of that, existing customers have to scrub their contract and sign a new two year deal which is $10 more for data and does not include unlimited texting.
If you have an iPhone purchased before July 11th, 2008, you're eligible for a $199/$299 upgrade.

If you are a current ATT customer and are eligible for a phone upgrade (check your ATT account online), you are eligible for the $199/$299 pricing.

If you are a current ATT customer and not eligible for upgrade pricing at the moment, the iPhone will cost $399/$499.

http://www.appleinsider.com/articles...n_july_11.html

http://www.wireless.att.com/cell-pho...als/iPhone.jsp

http://www.wireless.att.com/cell-pho...phone-info.jsp
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gingrass
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Jul 8, 2008, 08:13 PM
 
Fact is, if you're already a customer, they probably subsidized an other phone for you.. exemplea LG or Samsung phone and ''invested'' a 200 or 300 dollars on you as a client so you'd have for get to the end of your contract and then move to the iPhone with a new contract...

And btw, 2 year contract is'nt so bad, in canada we have to get a 3 year contract, the way things are going right now, the iPhone will be a dinosaur by then!
     
BoingoBongo
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Jul 8, 2008, 09:54 PM
 
It is annoying that not everyone qualifies for the upgrade, but it's understandable since, as mentioned, existing customers are probably using a subsidized phone. And really, the unsubsidized iPhone costs the same as the current one, so it's not that outrageous (and this is coming from someone who doesn't qualify for the upgrade).
     
ort888
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Jul 8, 2008, 10:10 PM
 
Yeah, I know I probably don't have a shot. I just don't understand how some people get some things. I have a friend at work who ends up with a new phone every 3 or 4 months. He is one of those people who is just picky and fickle to a fault. He gets it in his head that some stupid thing is wrong with his phone and he goes in and bitches until they give him a new one. He has seriously had about 10 phones in the last 2 years.

I just can't bring myself to go into a store and be a jerk in order to get what I want.

I'm going to try and be very polite and reason with them, but I'm expecting nothing. I have a feeling it's all going to be for naught, but what the hell.

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BoingoBongo
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Jul 9, 2008, 01:51 AM
 
Originally Posted by ort888 View Post
Yeah, I know I probably don't have a shot. I just don't understand how some people get some things. I have a friend at work who ends up with a new phone every 3 or 4 months. He is one of those people who is just picky and fickle to a fault. He gets it in his head that some stupid thing is wrong with his phone and he goes in and bitches until they give him a new one. He has seriously had about 10 phones in the last 2 years.

I just can't bring myself to go into a store and be a jerk in order to get what I want.

I'm going to try and be very polite and reason with them, but I'm expecting nothing. I have a feeling it's all going to be for naught, but what the hell.
Good luck man! I think a lot of it just has to do with who happens to be in charge of whatever store you go into, so you could get lucky.

Often times I'll try to raise hell like your friend to get what I want, but it never works out. I immediately feel guilty and back down. Even if a company's policies are terrible, it's usually not the fault of the poor person working behind the counter.
     
Kenneth
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Jul 9, 2008, 01:24 PM
 
The whole cell industries do that all the time, it's nothing special.
     
   
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