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If you want to purchase an iPhone from an Apple Store, forget about using cash or a gift card.

Apple is stepping up its efforts to limits resellers from getting their hands on the popular iPhone. Apple wants to crack down on those who buy, unlock and then resell iPhones to consumers.

Of the roughly 1.4 million iPhones that have been sold since its introduction in late June, Apple COO Tim Cook estimates that 250,000 iPhones have been purchased by customers who have the intention of unlocking the phones.

"Customer response to the iPhone has been off the charts, and limiting iPhone sales to two per customer helps us ensure that there are enough iPhones for people who are shopping for themselves or buying a gift," said Apple spokeswoman Natalie Kerris. "We're requiring a credit or debit card for payment to discourage unauthorized resellers."

Cash will no longer be an acceptable form of payment for iPhones and Apple has also reduced the purchase limit from five iPhones per person to two.

Today, however, Engadget is reporting that Apple has gone one step further than just denying cash customers. Apple is also denying the use of Apple Gift Cards to purchase iPhones. For those looking to get a stack of Apple Gift Cards for Christmas to put towards the purchase of an iPhone; you may want to rethink that idea.

Apple recorded 67 percent higher profits for Q3 2007 thanks in part to the iPhone. Apple's crackdown on resellers and those who wish to unlock the iPhone is no doubt a measure to protect the steady cash flow from AT&T.

According to Piper Jaffray analyst Gene Munster, AT&T is paying Apple an average of $18 a month for each iPhone customer. In other words, Apple receives $399 for each iPhone sold plus an additional $432 over the course of a two-year contract thanks to AT&T's exclusivity arrangement.



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Why Apple Why?
By JasonMick (blog) on 10/29/2007 10:12:30 AM , Rating: 3
Must you continue to shoot yourself in the foot?

You have innovative products, that with a little refinement could be great.

You had a "cool" image as the hip outsider.

You had great sales.

So why would you want to do something silly like this or iBricking to jeopardize it?

Honestly it astounds me.

To me, it seems Apple is being its own worse enemy. For every step forward they take (ie. opening their phone up to third party devs), they seem to take two steps back.

Its a shame because they do have some innovative products.




RE: Why Apple Why?
By Anh Huynh on 10/29/2007 10:55:23 AM , Rating: 1
Because people will buy iPhone's, unlock them, sell them to people and the person that ends up with it will throw a fit because their brand new iPhone that they purchased through a third party is no longer under warranty.


RE: Why Apple Why?
By therealnickdanger on 10/29/2007 12:06:33 PM , Rating: 1
While I'm certain that's not Apple's primary concern, that's an excellent point. Any fool can hack a phone, but when it breaks... there will be anger.


RE: Why Apple Why?
By spluurfg on 10/29/2007 1:51:52 PM , Rating: 3
The one thing I don't get though.... why ban people from using gift cards totally? Wouldn't it be rather straightforward (and obvious...) to allow them to use their gift cards so long as they used their credit card to pay for, say, $1 of the cost? That way there'd be an e-trail?


RE: Why Apple Why?
By UNCjigga on 10/29/2007 2:12:05 PM , Rating: 2
Let's put it this way. 250,000 is a conservative estimate. Looking at AT&T and Apple's own numbers, there are about 400,000 iPhones sold that are "unaccounted for" by AT&T (i.e. they were jailbreaked and sold.) If AT&T is paying Apple a fee for every iPhone activated at AT&T, then Apple better make damn sure they're not letting their phones slip through the cracks. Its all just part of revenue assurance.

They must be denying gift cards to close a loophole in their system, i.e. dealers are buying bulk giftcards using one credit card and then getting around the "2-per-customer" or whatever rule is in place.


RE: Why Apple Why?
By spluurfg on 10/29/2007 2:40:20 PM , Rating: 3
Yeah, but if you make sure that at least $1 or even $0.01 of every iPhone sold was paid for with CC (and you can make up whatever of the rest of the balance with gift cards), then they can still enforce the 2-per-person limit while allowing customers to use their gift card value. They can split the balance between different payment methods at cash registers... it isn't rocket science.


RE: Why Apple Why?
By Tsuwamono on 10/29/2007 8:46:01 PM , Rating: 1
Ya, most of us get what you are saying but Apple users tend to be a little bit slower then the rest of us... have patience.

It's like dealing with a retarded child.


RE: Why Apple Why?
By CascadingDarkness on 10/30/2007 5:29:34 PM , Rating: 2
Bit low, and uncalled for I'd say.


RE: Why Apple Why?
By novacthall on 10/29/2007 11:21:05 AM , Rating: 5
Apple is control. Get on board or get off, but they're doing their thing with or without you.

It's exactly this mentality (and abysmal customer service) that drove me away from the company in 1997. I haven't looked back, and seeing their behavior under Jobs, I haven't regretted it one bit.

The man's brilliant, don't get me wrong. He's a business man unlike just about any other on Earth. He's also a complete and total control freak, and that just doesn't fly with me.


RE: Why Apple Why?
By omnicronx on 10/29/2007 12:19:51 PM , Rating: 5
quote:
Get on board or get off
And this is exactly why apple users are out of their minds. We are the consumer, we should be in control. Its beyond me that people are willing to pay 600$ for a phone, but you are limited in the way they can pay, use, and or modify it. Any other company would be running for the hills right now. Amazingly this is why apple will remain a niche market on the desktop/laptop market. Only 10% of the population is dumb enough to take their BS!

P.S not allowing gift certificates is the dumbest idea ever, and people should be outraged. I guess I have to look at it from apples perspective though, all those iphone unlocker dealers buying iphones in bulk with their fancy giftcards... give me a break..


RE: Why Apple Why?
By Chris Peredun on 10/29/2007 12:31:15 PM , Rating: 2
quote:
We are the consumer, we should be in control.


As a consumer, I am in control. I can choose to take the $400 that would be spent on an iPhone and take it to a rival vendor or carrier. No one is forcing you to buy an iPhone.


RE: Why Apple Why?
By omnicronx on 10/29/2007 12:57:00 PM , Rating: 3
I have heard this argument many times before, but my point had nothing to do with apple 'forcing' anyone to buy their products. The point is, it will eventually be the end of them. Consumers like to be in control, period.. theres nothing you can say that will budge me on this matter. Even if they really are not in control, people like to at least think they are in control.

Apple does not even try to give the illusion that we have some say in any matter. It was the reason they fell the first time, and it will be the reason they fall the second time. You can only piggyback on ipod sales so long, and the iphone is a long ways away from getting any considerable market share. I will even go out on a limb here and say, if not for the ipod, Apple would no longer be selling computers.


RE: Why Apple Why?
By djcameron on 10/29/2007 3:27:33 PM , Rating: 5
Consumers like to be in control, period..

Hah! You're funny. Consumers are sheep. They are led around by companies like Apple. They walk around with their underwear showing and with the latest gadgets stuck to their head. Why? Because they want to feel special and unique! In the process, they end up looking just like everyone else. Also, because the marketing folks have learned how to control them. Consumers are anything but in control!!


RE: Why Apple Why?
By Anh Huynh on 10/29/2007 1:13:56 PM , Rating: 2
I chose to buy a $400 iPhone and I'm quite content with it. It works great as a phone with a web browser and e-mail client. The onscreen keyboard takes a few minutes to get used to but it isn't too bad. I no longer have a need for a full tactile QWERTY keyboard since I don't have to reply to emails 24/7, since I've stepped down from my position at DT.

And like everyone else I know with an iPhone, I love it. It's simple, small, thin and looks pretty. It also plugs into my car's head unit nicely, with full iPod control and no noise interference. The iPod also pauses music and rings through the car speakers as well.

As a consumer, I chose to buy the iPhone because the other companies didn't offer what I was looking for, for an all-around day-to-day phone, not just a business phone.


RE: Why Apple Why?
By omnicronx on 10/29/2007 1:26:15 PM , Rating: 2
The iPhone is easy, has great features, and as a product is a really cool phone. But the contracts offered are terrible, and the price is too high for having to sign a contract of 2 years. What is going to happen when other companies start making phones with the exact same capabilities, but you get it for 0$ because you signed a 3 year, not so evasive contract?

Apple is not dominating the phone industry, and although i don't know the real numbers, i doubt they have even have 1% market yet.If Apple expects to continue to go country to country with exclusive contracts, and thinks this plan will work in the long term, they are kidding themselves..


RE: Why Apple Why?
By Anh Huynh on 10/29/2007 1:41:35 PM , Rating: 2
I pay $85 a month, thats no worse than what I was paying for my Cingular 8525 with essentially the same plan. The $85 I paid for the Cingular 8525 was with a Student/Employee discount, without it, I'd have to pay close to $100. So the plans are quite fair for what they are.


RE: Why Apple Why?
By omnicronx on 10/29/2007 1:47:54 PM , Rating: 2
Ya, and i pay 75$ Canadian a month, have a data plan, and i got an e6800 for 100$, but it had a 100$ mail in, so it came to $0. Now of course our plans our about the same, but i got my phone for free. When iPhone clones start popping up, apple is going to have to change their business strategy, or they risk slipping into an even smaller niche market than they are already in.


RE: Why Apple Why?
By KingViper on 10/29/2007 2:53:13 PM , Rating: 2
Doesn't compare. I'm with sprint and pay $41 a month for unlimited data, free sprint to sprint, unlimited texts, free nights and weekends, etc. That includes the insurance costs.

Plus my phone was free.

You can't tell me $85 a month isn't any worse than what other companies have to offer.


RE: Why Apple Why?
By Anh Huynh on 10/29/2007 3:21:57 PM , Rating: 2
But isn't that the SERO plan?


RE: Why Apple Why?
By KingViper on 10/29/2007 4:34:21 PM , Rating: 2
Yes, but he was using a student discount before?

I can use any phone I want with this plan, so I don't think that should matter. Also, anyone can get the SERO plan.


RE: Why Apple Why?
By Oregonian2 on 10/29/2007 2:51:42 PM , Rating: 1
quote:
As a consumer, I am in control. I can choose to take the $400 that would be spent on an iPhone and take it to a rival vendor or carrier. No one is forcing you to buy an iPhone.


Just a comment that Microsoft gets absolutely nowhere using that argument about people being free to spend their money on other company's products. Nowhere at all. Zilch.


RE: Why Apple Why?
By wordsworm on 10/29/2007 11:41:06 AM , Rating: 2
Look, Jason, you're saying all this as if this kind of behaviour is new to Apple. Fact is this is the attitude from Apple as far back as I can remember. It's a part of their preppy image. I'm wondering when they'll realize that they should lock their Apple computers to an ISP and lock out any 3rd party developers.

Apple kicked butt when Steve Jobs started the company, and it's kicking butt once again now that Jobs is back. Apple is a prep company. People who try to become a rebel and get burned aren't going to tarnish Apple's overall image or its core, and growing, customer base.

You're assuming everyone is like you, or close to it. The fact is that Apple is making a fortune off of folks with too much cash to spend. These are the same people who probably don't really care if their phone bricks or not. They'll just buy a new one. That's what Apple suggested, because they know their customer base. $500 is chump change to these people.

I don't like Apple. I'll never buy one of their products. I rebel against Apple and all those other brands as best I can. I've never bought a product from Apple: not so much as an iTune. Really, the funny thing is that my hatred for their products started with the MacIntosh II that were in the journalism labs at my old high school. Those stupid, tiny monitors killed me. I know they've come a long way since then, but somehow I've never really changed my opinion of them. My biological donor, aka 'dad', despite strong warnings, decided to go for an Apple laptop, and he consistently dealt with severe problems and paid through the nose for fixes. I've never had those problems with any product I've ever purchased *knock* *knock*. But just because I have these feelings doesn't mean I'm going to think that Apple would be better off suiting my own needs and wants. They have their customer base. I have the companies I 'trust.' In your opinion they may have degraded themselves, but really, what they've done recently is nothing different from anything they've ever done.

It used to be that there was a point to owning a Mac. Its ability to do graphics, and its impressive software suites from Adobe, Quark Xpress, not to mention audio recording software, was always superior to what PC offered. I think there's still some stuff that just won't run on PC. For the most part, most of that has changed and all that pro software can be purchased for PCs too. But the fact that I had to pay for both the expensive hardware and software always kept me away. With PC, at least I could get pirated software. When I was in high school living off of welfare, that old 486 running MS Office helped me develop many skills that have helped me advance to a fairly 'middle class' career and lifestyle. With Mac, there was never that pirate community. Anyways, I digress. My point was that I'm not saying all this stuff because I'm an Apple twink.


RE: Why Apple Why?
By msheredy on 10/29/07, Rating: -1
RE: Why Apple Why?
By chick0n on 10/29/07, Rating: -1
RE: Why Apple Why?
By Anh Huynh on 10/29/2007 1:20:29 PM , Rating: 1
I'll agree with you. My Apple products work. I'm still content with my PowerBook G4 12" (last of the G4). Despite its minor blemishes and quirks with aluminum, the whole notebook has held together very well after two years, unlike my old Compaq Presario 1720US, which fell apart after 2 years, and I rarely took it anywhere.

My PowerBook has been to China and back, and I toss it around. It'd cost me just as much to get a PC of similar durability. Yes, ThinkPad's are awesome, but Windows Vista is still lacking.

I can run Leopard on my PB just as fast as Tiger was, no slowdowns, no lagging. Every new OS runs slightly better than the previous for Apple. Microsoft on the other hand....every new OS requires more resources and power to accomplish the same tasks.

The Mac OS X user interface is also worlds ahead of Vista. Vista was a step in the right direction with animations and such, but its far from useful. Sure you have the Windows key + Tab, but how often are you going to hit that key stroke?

On my Mac, I can drag the mouse cursor to any of the four corners of my screen to bring up Expose, Spaces or even Dashboard. With my little 1024x768 display, the OS X window manager is far superior.

Microsoft simply doesn't get it. Vista is nice, but without dual monitors, usability kinda sucks. </end rant>


RE: Why Apple Why?
By omnicronx on 10/29/2007 2:43:50 PM , Rating: 3
quote:
On my Mac, I can drag the mouse cursor to any of the four corners of my screen to bring up Expose, Spaces or even Dashboard. With my little 1024x768 display, the OS X window manager is far superior.
ObjectDock by stardock (http://www.stardock.com/) does the same thing, I am using it with vista right now. Of course its not native to vista, but there are so many windows enhancements out there if you really want to customize windows.

Mac's are nice for day to day use, but you can do so much more with windows, or even a linux OS... and for half of the cost.


RE: Why Apple Why?
By Anh Huynh on 10/29/2007 3:23:17 PM , Rating: 2
I don't like installing any extra for customization. I accomplish just as much in OS X as I can on my dual-monitor desktop.


RE: Why Apple Why?
By omnicronx on 10/29/2007 4:45:29 PM , Rating: 2
Not having to install something extra just makes things easier, it does not necessarily make things better. As i said, my Windows and Nix setups far surpass the basic install.


RE: Why Apple Why?
By essjae on 10/29/2007 9:34:55 PM , Rating: 2
quote:
I can run Leopard on my PB just as fast as Tiger was, no slowdowns, no lagging. Every new OS runs slightly better than the previous for Apple.....every new OS requires more resources and power to accomplish the same tasks.


Then why is the minimum req for Leopard an 867MHz G4? Try running Leopard on a G4 Cube and make the same statement.


RE: Why Apple Why?
By Anh Huynh on 10/29/2007 9:56:04 PM , Rating: 2
The G4 Cube was released like what....6 years ago? Do you honestly think it should still be supported? The oldest PowerMac G4 Quicksilver was introduced in 2001, to think the Apple still provides support for a system that old is just amazing in itself.

My PB is 2.5 years old, and the design was introduced nearly 3 years ago. Only upgrade I did to it was add 1GB of ram, for a total of 1.25GB. Now let's see you try to run Vista on a system that's 2.5-3 years old, and see how it fairs.


RE: Why Apple Why?
By DandDAddict on 10/30/2007 5:30:23 AM , Rating: 1
Its running very nicely on this duron 900 with 256 megs of ram and a 16 meg geforce4 igp, no aero but other than that its fine and very responsive, hell you can even play older games on it for that generation of gpu/cpu/ram just fine. Tho honestly the machines mainly a test/ide hd holder but its still a living case that Vista is completely usable on older hardware.

Lets see the socket 754 laptop Im using to type this is fairly old and running Vista Ultimate with all of the bells and wistles maxed out, even manages to play Rise of Legends, Fear, so on just dandily on the higher settings. So ya Vista works fine on older hardware.

Mac Ive had more trouble with and pissed me off to the point of all my mac ppc machines now run linux. What really ticked me off was the whole bombarding me with ads for OSX every couple of seconds when I went to update OS9 , I mean come on I should only have to click once or twice to tell you to screw off and I dont want your product when Im trying to get updates for your previous product, god knows MS and no other companies have pulled this shit on me. I actualy did check to see if I could run OSX and well apprently OSX requires a firewire port according to the website if I recall correctly, so I cant run it anyway and they still were shoving that crap at me.

Also MS is providing support still for OSes more than 6 years old both free and extended. Ive sent in hardware with lifetime warrenties for replacement and its been honored in the form of upgrades, so id say long term support is fairly normal, not to mention i didnt have to pay out the nose for it.

Anyway ye it annoys me to no end that I must own and learn about macs cause god they are extreamly annoying and inconviant, but thats business for ya. Tho the swap to intel makes it easier, now I can just run the Mac OSes on my main x86 rig which is handy for the few times I need to use it.


RE: Why Apple Why?
By Inkjammer on 10/30/2007 1:51:47 PM , Rating: 2
Well said!

Myself, I started with an Apple iPod 20GB 4th Gen, and recently went to a 80GB 5th Gen. I bought the iPod for one of several reasons, the manufacturer was the least them.

I'm a PC fan through and throughout, but when I shop, I go for the product that appeals to me most in terms of looks, functionality, usability and more. People seem to argue left and right that Apple's fanboys only buy the product for the looks or the "status" it brings. I've seen the competition's offerings, and short of the Zune, the mobile MP3 market is full of a lot of fugly products with little to no market support (e.g. docks, external players).

I chose the iPod because it had the best periphial support, the best drive space and the best tools to suit my needs. I can't stand using Mac OS, and I really don't like Macs, especially for work (and I'm a freelance graphic designer/animator!). Everybody has their preference, and their needs vary.

Kudos for bringing a solid argument to the table. It's refreshing, though rare.


RE: Why Apple Why?
By FITCamaro on 10/29/2007 12:12:42 PM , Rating: 2
quote:
For every step forward they take (ie. opening their phone up to third party devs), they seem to take two steps back.


Yes but the thing with Apple is that almost all the bad stuff with Apple almost never makes it to the mainstream media. So their image never really gets tarnished.


RE: Why Apple Why?
By maverick85wd on 10/29/2007 1:49:44 PM , Rating: 3
Quite... but also, most people don't care. One of my friends has an iPhone and I was telling him about the whole third-party software debate, the whole AT&T upset, and basically why I don't own one. His response was basically that his iPhone worked fine, that he didn't mind AT&T, and that he loved it, even after I tried to explain what his iPhone was capable of if Apple would allow others to unlock it's potential. Basically, he didn't understand that the ability to install third-party software could open up new functionality that he had never thought of... most people don't really know what it's all about so they don't care. Apple wins. :-/

on a side note, I would love an iPhone but refuse to put up with their over proprietary mind-set. Apple has wonderful products that are very innovative, but they are a little over-priced and they don't allow the user the freedom to do what they want with their products. Too bad to, they have such potential.


RE: Why Apple Why?
By Anh Huynh on 10/29/2007 3:25:02 PM , Rating: 2
Everyone I know with an iPhone is happy with theirs.

Third-party apps are nice, but for the most people, me included, the wow factor doesn't last that long. I installed apps, didn't use anything besides the default iPhone apps. A lot of my friends are the same.

The third party apps are nice to have but not necessary a necessity. Not to mention the apps crash the iPhone like hell.


RE: Why Apple Why?
By maverick85wd on 10/29/2007 4:10:08 PM , Rating: 2
it should still be up to the user whether or not they are used... bricking someone's phone because they have third-party software installed is, in my opinion, unacceptable.

but I see where you're coming from


RE: Why Apple Why?
By Anh Huynh on 10/29/2007 4:18:18 PM , Rating: 2
Yes, but if they "officially" allow it, users will turn to them for repair, warranty when the third party applications kill their iPhone.

Users will not blame the application, they will blame Apple.


RE: Why Apple Why?
By maverick85wd on 10/29/2007 4:57:02 PM , Rating: 2
there is quite a difference between saying the warranty is void if third party applications are installed and releasing an update that renders your phone permenantly disabled if you use third party software.

and if they didn't brick phones with third party software you may actually have legit software companies produce some useful applications that are well written and actually do NOT harm your phone


RE: Why Apple Why?
By crystal clear on 10/29/2007 12:33:05 PM , Rating: 2
Now look at this from another point of view-

The iPhone makes its debut in France on November 29.

The iPhone makes its debut in the UK on November 9.

The iPhone makes its debut in Germany on November 9.

Add to this local demand in the USA,which is already very high & expected to increase in the major buying season.

Read this survey report about consumer satisfactions (USA) -

According to ChangeWave's latest consumer cell phone survey, completed Oct. 2, the Apple (AAPL) iPhone continued to enjoy solid growth while it raced to a huge lead in terms of customer satisfaction.

The survey of 3,654 Alliance consumers looked at key market share changes among the major cell phone manufacturers and service providers and found that, while the iPhone has been on the shelf just three months, its impact is already being felt industry-wide.

iPhone Ups Its Share

Apple's current cell phone market share showed solid growth that was in line with previous expectations. Among respondents, market share has doubled since our previous cell phone survey in July, rising to 2%.

The top cell phone manufacturer, Motorola (MOT), maintained its No. 1 spot in terms of current market share with 30%; however, that figure has fallen one percentage point since our July survey to its lowest level in more than a year.



http://www.changewave.com/freecontent/viewalliance...

Add to this huge demand in Asia/Mid East/China/India for iPhones & a low $ makes it even more attractive a bargain.
exclusively for unlocking purposes.

There is huge traffic/trade of iPhones moving into the above regions(Asia)
through 3rd parties/businesses/gifting/reselling/tourist etc.

Apple could be having a serious supply problem from its hardware manufacturers to meet demand for iPhones-
in USA/Europe/Asia all put together

It cannot afford for AT&T sake be running out of iPhones in the major buying season.

Even Apples hardware/components manufacturers could be having their own supply problems.

All this when we are entering a major buying season......think.


RE: Why Apple Why?
By rudy on 10/29/2007 4:08:58 PM , Rating: 2
Maybe apple is losing money on the iphone and only the kick back from ATT and iTunes sales make it profitable.


"There's no chance that the iPhone is going to get any significant market share. No chance." -- Microsoft CEO Steve Ballmer

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