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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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Apple will have a problem...
By Murst on 10/29/2007 10:43:58 AM , Rating: 5
Although Apple certainly can choose not to accept cash for certain purchases (since the payment is not repayment of debt), they will most likely run into issues when they decline to accept gift cards.

A gift card is like a contract between you and the company that issues the card. Although they certainly can have limitations, Apple would not be able to add additional limitations after the purchase of the card (they would need to honor the contract at the time of purchase).

According to apple's own terms and conditions located at http://www.apple.com/go/giftcards/ , the following exclusions apply to the purchases made by a gift card:

quote:
You can purchase just about anything sold by Apple (except another Apple Gift Card, an iTunes Gift Certificate or purchases at the iTunes Music Store), including products from both Apple and third-party makers.


Nowhere does it say you are not allowed to purchase the iPhone, and this is where I think Apple may run into some issues.

Anyways, IANAL.




RE: Apple will have a problem...
By crystal clear on 10/29/2007 11:08:04 AM , Rating: 2
Sorry they catch you in the small print-All your arguments become useless.

Apple reserves the right to change any of these terms and conditions from time to time without notice.

Refer to you link & see the fine print below.


RE: Apple will have a problem...
By Murst on 10/29/2007 11:21:48 AM , Rating: 3
Just because Apple puts something like this doesn't mean that it is valid.

On July 18th, 2007, in Douglas vs. Talk America, the judge ruled that a company simply cannot change its terms of service (by posting an updated version on their website).

Link: http://pub.bna.com/eclr/0675424_071807.pdf

Although this was not about gift cards, it wouldn't be a stretch to consider this as a precedent for all similar wording in contracts.

In any case, Apple still has NOT changed their terms and conditions, and according to Apple's latest terms and conditions, you can use the gift card to purchase the iPhone.


By crystal clear on 10/29/2007 8:37:46 PM , Rating: 2
Apple has the $$$$$ to fight you in court with those high priced lawyers who certainly know "How to get their way around-& get what they want".

For them both lawsuits & courts are part of daily routine,nothing new that would upset them.

For the ordinary buyer LAWYERS are an expensive affairs-they certainly dont come cheap.

Nor do these ordinary buyers have the TIME for such things & look for a PRACTICAL & CONVIENIENT solution for such things.

The example you gave even though relevant doesnt always hold in every court/state-interpretations by judges/jury vary or differ.

Gift card holder/s dont hold cards worth 10s of thousand dollars per person.
Indivisual claims are very small indeed..

Yes a class action suit started by some lawyer out to make a big buck is possible,but the outcome is ....wait & see....
certainly a long & time consuming process....the results unknown.


RE: Apple will have a problem...
By timmiser on 10/29/2007 12:52:57 PM , Rating: 4
That statement is only there to stop gullable people from persuing legal action! A catch all statement to cover everything possible under the sun does not stand up in court.


RE: Apple will have a problem...
By Anh Huynh on 10/29/2007 1:23:27 PM , Rating: 2
Yep, but the average consumer don't know that. It's like writing VOID on a check, legally its not going to void it, but people will think it is.


RE: Apple will have a problem...
By theapparition on 10/30/2007 7:32:49 AM , Rating: 2
quote:
Although Apple certainly can choose not to accept cash for certain purchases (since the payment is not repayment of debt)

Are you sure about this? I'm no expert, but was of the opinion that it was illegal for anyone in the US to refuse payment in cash, even if you paid for it all in pennies.


RE: Apple will have a problem...
By emboss on 10/30/2007 12:29:14 PM , Rating: 2
Any transaction is, essentially, a contract. The details of which can be pretty much anything, including "payment only accepted in the form of ...". If you don't like the agreement, don't proceed (ie: don't buy the iPhone).

It's different in the case when money is owed - if you owe an entity money, they cannot (in a contractual sense) refuse cash to settle the debt. This is why restaurants, for example, pretty much have to accept cash. If they don't you can simply walk off - you still owe them for the meal of course, but since it is they who have refused legal tender for the debt, they can't hit you for anything other that the debt owed at that point in time (ie: no interest, "administration costs", etc). Essentially the debt is frozen at the time they refused payment.

This does create a slight loophole, in that you can make a contract and then simply refuse to pay in anything but cash. If the seller then sues you for breach of contract, the decision will almost certainly go against you, and you will legally be in debt to the seller, a debt for which the seller must then accept cash for. Of course, you'd have to be stupid to do so since you'd probably get hit up for costs as well, but the option is always there.

In the case of a retail sale, the contract is the customer offering to buy an item. There's various implications to this, such as the price tag shown in the isle holding little legal weight. The seller can refuse the offer on pretty much any grounds - it's the last one left, the person is wearing a green shirt, it's raining, etc etc. They can also refuse it if they don't like what's being offered in exchange. Importantly, there is no contract until the seller accepts the offer, which is taken to be after they have accepted the payment (which is *after* you have handed over the form of payment, so if you hand over a fake bill and the seller spots it, there's still no contract yet). Until then, there is no contract to breach, so there's no loophole there.

The best you could do would be to get the seller to explicitly sign a bit of paper saying that they'll give you an iPhone for $400 (or whatever the price is now), take the iPhone, and then try to pay in cash. Note that it's important that you take the iPhone, otherwise you'll have to sue them for breach of contract, which probably won't work out so well ...


"We shipped it on Saturday. Then on Sunday, we rested." -- Steve Jobs on the iPad launch

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