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Blog: Gadgets AT&T Announces Official iPhone 3G Pricing
Shane McGlaun (Blog) - July 1, 2008 2:58 PM

26 comment(s) - last by ebakke.. on Jul 9 at 10:48 AM

Official iPhone 3G pricing and plans announced

We all know that the iPhone 3G is coming this month, you can hardly escape the coverage around the web. The iPhone 3G will be available on July 11 from AT&T here in America. Now that the launch is closer, we are getting some information from AT&T on its official pricing plans.

The day the iPhone 3G was announced, I took some time to talk directly to Mark Siegel, Executive Director of Media Relations for AT&T Mobility and ask some questions. The big question on my mind and many others on June 16 was if those who bought the original iPhone early on would be allowed to upgrade to the new iPhone 3G.

The answer was yes, anyone can get the iPhone and Siegel told me directly that it would only require a new 2-year agreement. According to Engadget, that is accurate for AT&T customers who bought the iPhone before July 11 and for new customers. Anyone upgrading to the new iPhone from other AT&T handsets not eligible for upgrades will get hit with much higher prices to upgrade.

Those upgrading from a handset not eligible for discounts will pay $399 for the 8GB iPhone 3G and $499 for the 16GB model with a new 2-year agreement. Engadget also says that a no-commitment version of the iPhone 3G is coming at a gut-wrenching $599 for the 8GB and $699 for the 16GB. New customers signing up for with a two-year contract can get the phones for $199 and $299 respectively.

The individual plans for the phone start at $69.99 and include 450 voice minutes, unlimited data and 5000 night and weekend minutes. No text messages are included in the plan. For $129.99 you can get unlimited minutes anytime for an individual. Text messages for the iPhone will cost an additional $20 for unlimited messaging, $15 for 1500 texts per month and $5 for 200 texts per month.

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incorrect assumption

By johnsonx on 7/1/2008 3:14:58 PM , Rating: 4

quote:
It's not like AT&T is losing anything by letting all iPhone owners upgrade at the price new iPhone 3G customers get. This is simply a way for AT&T to get more money...

This is not a reasonable conclusion. AT&T reduced the price of the original iPhone based on the revenue it expected from the two-year contract. If they let you switch to a new iPhone at the fully-subsidized price, even with a new 2-year contract, they've now lost the contract revenue to fully pay for the first iPhone; the contract revenue is now going towards the second iPhone.

You should consider it a gift that they will let you switch at all, at any price less than 100% full retail, before your 2-year contract is up.

RE: incorrect assumption

By nosfe on 7/1/2008 3:30:20 PM , Rating: 2

"full retail" costs 200$ with a 2year contract so i think that they(the early adopters) would actually want to pay that and not the 400$ that they are asked to pay now for an upgrade.

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RE: incorrect assumption

By TomCorelis on 7/1/2008 3:47:37 PM , Rating: 2

I thought you could pick up an iPhone at an Apple retail store regardless of your status with AT&T?

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RE: incorrect assumption

By oab on 7/2/2008 12:06:50 AM , Rating: 2

No phones leave the stores without being activated anymore.

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RE: incorrect assumption

By FITCamaro on 7/2/2008 7:57:49 AM , Rating: 2

Apparently there's talk of them allowing you to have one without the contract, but it'll still be locked to the AT&T network.

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RE: incorrect assumption

By Ramshambo on 7/3/2008 3:58:30 PM , Rating: 2

I just activated mine over iTunes last month. Before that I was using it as an Ipod touch for two months.

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RE: incorrect assumption

By ebakke on 7/9/2008 10:48:10 AM , Rating: 2

You activated an iPhone not a 3G iPhone, which is what this article is about.

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RE: incorrect assumption

By vbNetGuy on 7/1/2008 3:32:37 PM , Rating: 2

quote:
New customers signing up for with a two-year contract can get the phones for $199 and $299 respectively

So $199 for the 8GB and $299 for the 16GB

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RE: incorrect assumption

By masher2

(blog) on 7/1/2008 4:07:33 PM , Rating: 2

quote:
This is not a reasonable conclusion. AT&T reduced the price of the original iPhone based on the revenue it expected from the two-year contract. If they let you switch to a new iPhone at the fully-subsidized price, even with a new 2-year contract, they've now lost the contract revenue to fully pay for the first iPhone; the contract revenue is now going towards the second iPhone.

QFT. Those revenues from the original contract went to Apple, to pay their profit margins on the original iPhone. AT&T allowing you to switch is a nice bonus, not a kick in the pants. If any consumer didn't like the deal with the original iPhone, they shouldn't have made it.

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RE: incorrect assumption

By TomCorelis on 7/2/2008 4:50:56 AM , Rating: 2

While I understand and agree with your logic, as a Samsung Blackjack-owning AT&T customer with a year left on my contract ... this sucks. I never expected excellent customer service, but I didn't anticipate being outright punished for wanting an iPhone while being an AT&T customer.

There go my plans to upgrade this summer ... instead I'm stuck with this piece-of-crap Blackberry clone.

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RE: incorrect assumption

By therealnickdanger on 7/2/2008 8:04:08 AM , Rating: 3

I'm trying to feel sorry for you... but I just can't. :P

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RE: incorrect assumption

By masher2

(blog) on 7/2/2008 10:38:06 AM , Rating: 5

> "I didn't anticipate being outright punished for wanting an iPhone while being an AT&T customer."

I'm sorry, but I don't understand your thought process on this. This is no different than what AT&T -- or any other mobility firm -- does with any other phone. You got a discounted rate on a phone for agreeing to a two-year contract, now you don't want to live up to your half of the agreement?

If you don't like the price of the iPhone, talk to Apple. AT&T doesn't control that. All they do is lower that price by agreeing to give up a portion of their service revenues....IF you agree to a contract.

So where's the beef?

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Better than Canada

By oab on 7/2/2008 12:08:36 AM , Rating: 2

Rogers in Canada is charging $65 (plus 69.99 system access fee) and you get:

150 anytime minutes
400mb browsing.

Which is a horrible deal, and it costs $15 more to get caller-ID.

I get that for free on my prepaid phone.

RE: Better than Canada

By DarkElfa on 7/2/2008 1:15:12 AM , Rating: 3

Apple should have left the iphone as an open piece of tech fo sale at any provider instead if contracting up with AT&T and all I have to say to both of them is **** You.

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RE: Better than Canada

By mmntech on 7/2/2008 3:51:25 PM , Rating: 2

No kidding it's a horrible deal but it's typical here. Only three cell providers for some 30 million + people and no limits on what they can charge. No competition. Canada supposedly has the highest cell phone rates in the Western world. Rogers and Bell are terrible providers (especially the latter) and Telus isn't much better.

I had figured that Rogers' iPhone plan similar to that of AT&T's would be over $100 a month. I was right unfortunately.

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RE: Better than Canada

By DASQ on 7/3/2008 2:43:39 PM , Rating: 1

Good God that is bad. I'm with Fido... which is really saying I'm with the doggy version of Rogers (curse them for buying Fido!)

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missing from the article

By johnsonx on 7/1/2008 3:05:57 PM , Rating: 1

The article here doesn't mention what the price of the 3G iPhone is for new customers. No doubt it's mentioned in one of the linked articles, but since the entire article is a gripe that existing iPhone customers have to pay extra vs. new iPhone customers, then all the prices should be stated.

RE: missing from the article

By oab on 7/2/2008 12:06:17 AM , Rating: 2

"New customers signing up for with a two-year contract can get the phones for $199 and $299 respectively."

-- The blog article.

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RE: missing from the article

By johnsonx on 7/5/2008 1:11:17 AM , Rating: 2

Obviously at the time I posted that the information wasn't in the article. I'd like to think it was added specifically because I pointed out it was missing, but who knows?

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This is more expensive than the first iphone

By lebe0024 on 7/1/2008 4:00:22 PM , Rating: 2

Since the data plan price increased $10, that's $240 over the two year contract, which is $40 more than a two year contract with the old cheaper iphone.

RE: This is more expensive than the first iphone

By vapore0n on 7/1/2008 6:14:47 PM , Rating: 2

you forgot the 5$ increase for text messaging

Cheaper at month 0 but you pay for it over time.

Time to consider some other phone/company.

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Absolutely incorrect

By Doormat on 7/1/2008 6:18:10 PM , Rating: 2

quote:
Early adopters of the original iPhone will pay $399 for the 8GB iPhone 3G and $499 for the 16GB model and still get stuck with a new 2-year agreement.

Absolutely wrong.

The original iPhone was not subsidized by AT&T. Therefore AT&T didn't subject the phone to the traditional upgrade rules (subsidy in exchange for only upgrading every 2 years). AT&T further reinforced this when the 16G iPhone came out and said that users would be able to buy the device and not have to pay any penalty or such, and even said that the 2 yr agreement for the iPhone would not be reset by activating the phone.

I just checked my AT&T account, and for my iPhone, "This line is eligible for equipment discount pricing when you sign up for a 2-year service agreement." In other words, because the iPhone was full price and not subsidized, existing iPhone owners can purchase the phones at the 199/299 price level.

If your iPhone phone line shows something different, then its probably an error and you should contact AT&T and get it corrected. There are even reports of those who originally bought a subsidized phone before the iPhone who are still in that two year window who show as eligible for the discount (199/299) pricing.

The $399/499 price is for those who are using an AT&T non-iPhone phone who have bought it in the past 2 years and are effectively still paying off the phone subsidy.

RE: Absolutely incorrect

By Doormat on 7/1/2008 11:42:37 PM , Rating: 2

PS The video is here:

http://www.att.com/gen/press-room?pid=6158&cat=32&...

You want part 1 - Existing AT&T customer who owns iPhone.

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$$$

By dickeywang on 7/2/2008 12:26:58 PM , Rating: 2

So for $199+$69.99x24= $1880 (assuming you're a new user who pick the 8GB model and the cheapest plan), you get a gadget which may attract some eyeballs in the next 6 months and a expensive cell phone plan that will bound to you for 2 years. It may make sensor for those who actually need a $69.99 plan, but certainly not for me. :D

RE: $$$

By callmeroy on 7/3/2008 1:45:30 PM , Rating: 2

Agree, nifty phone with all its features but wow people must really have a ton of money to toss around or a much greater "geek side" to them that I "think" I have to throw this much cash at a phone.

Is it really that MUST HAVE to watch movies/videos/chat and have GPS on the go - anywhere you are to throw close to 2k yr. on it?

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Wow...

By aegisofrime on 7/7/2008 11:44:22 AM , Rating: 2

I never knew that the US Mobile market is so screwed up. Here in Singapore we get:

100 Minutes, 500 SMSes for 25 Singapore dollars, or about 20 US$.

For an additional 11 Singapore dollars, or 8 US$, I get a 3.6Mbps HSDPA data plan with a 50GB download limit.

On top of that, there's a $200 phone subsidy, and the phone's not locked. (whatever phone locking is)