[Macworld]

Post your comments for Apple hopes cheaper iPhone 3G will broaden market here

[mdixon]

Sorry Apple, you just don't get it. I'm a big-time Mac user, and a big supporter of your hardware and software, but the iPhone service contract and carrier is the problem here. The new iPhone is finally at a price point that I might have jumped at, if it weren't for the even more expensive required service contract and AT&T being the sole provider. In my area, AT&T signal strength is fairly limited to urban areas, but other carriers in the area have far more towers for better coverage when I leave town. It makes no sense for me and others who don't live in NYC, Boston, LA, or other large metro centers to consider the iPhone until you let other service providers offer it. Therefore, you are not going to broaden your market beyond urban centers until you get beyond AT&T and ridiculous service pricing.

[Axl]

I gotto agree - by licensing the iphone to single carriers in each market Apple has ensured these carriers have iphone monopolies and so eradicated competition. Not good for consumers. But equally its the carriers that don't get it. The combination of a subsidized iphone and low rates will ensure any carrier loads of new subscriptions. Instead they are largely seem to go for the short term goal of immediate return on investment through higher profits. Consumers loose again.

[xray01]

Agreed. It's nice that the iPhone is cheaper, but the total cost of ownership has gone up. Granted one is getting more by being on the 3G network, but let's not loose sight of the fact that it is more expensive. I have a couple friends who were excited about the new iPhone, but have since decided against it because of the expensive plans.
I never really understood why the mobile phone makers are locked into the specific providers. Why cant I just buy any phone I want and choose any service provider I want. And what's with the draconian fees for switching providers! I doesn't spur any real competition.

[estumpges]

I completely agree with the comments above. Apple has a great mobile phone/internet device with the iPhone! And now it even has a great low price...
However, because in most countries the iPhone is only available from one carrier, there is very little competition to keep the rate plans reasonable. I think Apple should sell an unlocked and unsubsidized version of the iPhone on their website and through their retail stores. This would open the market for more carriers to jump on board and it would generate competition for good plans. Granted, in the US the iPhone would still be limited to ATT and T-Mobile, but even that would be an improvement.
The biggest remaining barrier to massive iPhone adoption worldwide is the closed nature of the phone. Many people don't have the luxury of being able to switch carriers at will and others are put off by high rate plans offered by monopolistic carriers. If and when Apple opens up the iPhone to all carriers, the gates will be open for a tremendous wave of sales.
This is in Apple's best interest. I really can't see why they haven't done it already...

[lwdesign]

What in effect has been done is that the iPhone 3G is now MORE expensive than the original iPhone, not less. The strategy is to offer the physical phone fore "less" money up front, then catch up and surpass the price of ownership by the monthly service costs. So the "Twice as fast. Half the price." marketing line is only true if you look at the up front cost of the phone. I'm very glad I bought my first gen 16GB iPhone with its cheaper plan. I'll have all the advantages of the new version 2.0 software, relatively cheap rates and better battery life. I'll miss the GPS function of the new phone, but hopefully by the time the iPhone III hits the market, rates will have come down to reasonable levels--and more providers will be able to sell the iPhone.

[NoahFence]

I the majority of AT&T users are like me, the new iPhone 3G isn't any cheaper! You have to be eligible for a hardware upgrade to get the lower price. Otherwise it's $499.00 for the 16GB phone! I've been a faitfull customer of AT&T for over 10 years! My average monthly bill is always over $100. Anyone want to guess how many times in that 10 year span I have been eligible for a hardware upgrade?
ZERO!
I travel extensively. My "phone needs" change quite frequently thus I change my plan a lot. For example, When I go over-seas, I implement an international plan. When I return Stateside, I remove it. Each time I change my plan, a new 2 year contract starts as well as my eligibility date!
Never-the-less... you will see me in line this Friday to satisfy my latest & greatest gadget addiction. I'll be the one that's bent over, grabbing my ankles!
~NoahFence

[JezusBJK]

Blah blah blah... after following the iPhone 3G hype for the past few months, I am so sick and tired of all the complaints and whining and crying about what the iPhone can't do, how much it costs, etc. "Man, the iPhone sucks, it can't drive me to work and cook me dinner when I get home." Shut up! Stick with your freebie Nokia and a basic low-end voice plan, then. There is nothing like the iPhone on the market... really, what do you expect, a $50 sticker price and $20 per month service? Maybe Apple and AT&T should just give them out for free?
Please. If you get any other smartphone package and internet data package on AT&T you're spending the same amount each month. But this is an --Apple iPhone-- with an iPod, phone, camera, amazing web client, and unlimited App options built in. Just realize there is nothing essential about iPhone... Blackberry will always rule the corporate world. This is a toy that multitasks and keeps you busy throughout the day.
$30 extra a month is not going to wreck my life. If it's gonna change your life and you can't afford to feed yourself because you're spending a few extra dollars more a month (what, $15 bucks more than the original for better capabilities?) then stop complaining and go away.
I waited patiently through the first iPhone lifecycle and am ready to join the new club. It's not for everyone, so stop pretending it is.

[Gbreed]

Let me direct. Th Phone need to become open and expanble. Lock it to ATT will hurt sales in the long run. I love Apple; I even have an Apple TV. I will not be buying an iPhone.

[adobephile]

I coulda said that, but you did it so well!

[iollmann]

JezusBJK said:

$30 extra a month is not going to wreck my life. If it's gonna change your life and you can't afford to feed yourself because you're spending a few extra dollars more a month (what, $15 bucks more than the original for better capabilities?) then stop complaining and go away.

Just to be difficult:

$30 / mo. accruing at 7% return for 50 years is $164,395.54

...or about the cost of a burger and fries in 2058 after we are done with oil + Boomer caused inflation.

[bob_t]

mdixon and other commenters have it right: it is the relationship of hardware, software and the carrier. While JezusBJK has a point that iPhone 3G data plans cost the same as other AT&T phones, that's ignoring the bigger picture: the iPhone's features are what is bringing customers to AT&T, and they, like Verizon Wireless have been historically antagonistic towards features, "openess", and many would say the very subscribers that pay them monthly. When potential subscribers shy away from a carrier, even after having been offered very good hardware, that's telling. It's not just about an increased monthly data plan cost. It's the underlying value here that is the elephant in the room. When a hardware/service combo is better than another, most people recognize it and are willing to pay a fair price, even a premium. The problem here is that AT&T's 3G data network is currently NOT better than the competition, and it will be some time before it even rivals Verizon's and Sprint's current revA EvDO coverage and speed. Over time, AT&T's coverage might get better, or it might not. Potential purchasers feel disgusted with Apple and AT&T because they know the data plan and text plan prices are not fair, and any argument that data plan prices are competitively fair is a joke. Use some logic here folks. AT&T, like VZW, has chosen the Long Term Evolution (LTE) path, which has the benefit of providing both voice and data on towers so equipped. Yet for the time being AT&T's 3G is hit or miss... sometimes it is there, and you can do concurrent voice and data, and sometimes you're begging. Voice audio is also clearer than GSM and CDMA as well. But all those carrier features are only partially here. So they're really only deserving of a "partially here" price. Great phone... half-baked network. Competitive data plan pricing? Not at all.

[bob_t]

Here's why text plan prices are NOT fair...
Text messages with no messaging plan are 20 cents a pop for an equivalent of 160 bytes of data (if you use all 160 characters... a baseline for sake of argument, even if most text messages rarely use all 160 allowed characters in each message). It should also be pointed out that 160 characters is (now) an arbitrary limit... you can exceed that number of characters in an SMS message, you're just charged for two, three, or more messages for every 160 character grouping.
So the 200 message plan would be equivalent data-wise to 31 kilobytes for ALL 200 texts (kilo=1024, kilobyte=KB).
For comparison, Macworld's editorsNotes.gif image placed at the top of the "Will higher data plan costs hurt iPhone 3G sales?" article is just just over 8.5 KB on the Macworld.com servers (http://images.macworld.com/images/templates/blogs/editorsNotes.gif). Four of them would equal about 34 KB.
Now, would anyone reading pay $5 to send four copies of that little gif image to or from an iPhone? Seems like a rip-off huh. Yet we pay the equivalent for texting.
31KB isn't worth $5/month, nor is the Messaging 1500 text plan, equivalent to a maximum of 240KB worth $15.00/month.
Text messages should be PART of a data plan, if treated as a separate charge at all. They really ought to be included with your monthly service. As it is, the pricing is a complete rip-off, either when considered as a service or as mere data.
This is what angers consumers and users of good hardware/software and potentially good carrier services. When service prices start off as a bad deal and get worse, rather than improve, sometimes even the best hardware will not make a convincing argument to continue using the service.
Texts have gone from 10 cents to now 20 cents in just a few years. Not even the U.S. Post Office, a statutory monopoly, is that aggressive with their postage rate increases.
I wonder what Steve Jobs thinks? Does a billionaire even consider that $5 for 31KB of data is a rip-off to mere salary-earning mortals? What about AT&T Mobility's Ralph de la Vega? Does he have the vision to do away with a hugely unfair racket?
Unfortunately I seriously doubt it.

[bob_t]

Like this one, most iPhone 3G pricing articles published lately forget the $36 activation fee for new contract signers ($18 for up-graders), nor do they mention taxes and so-called "fees", commonly referred to as "non-recoverable expenses." I'm not sure why these dollars aren't added, after all, we have to pay them out every month.
I pay $12/month extra on average for taxes and fees attributed to "non-recoverable expenses" on the advertised entry-level original iPhone $59.99/month plan. That's $288 over the 24 month contract's oft-stated service cost of $1,439.76, not including the original $36 activation charge. So for two years of service the original iPhone's entry-level plan actually cost me $1,763.76. Let's not talk about the original hardware price. >:-/
So a TRUE conservative estimate for a monthly total on the iPhone 3G's entry-level plan will be closer to $85/month with fees, or including hardware, $2,257.00 over 24 months without a messaging plan, and $90/month or $2377.00 over 24 months with entry-level messaging plan.
And I am being kind by adding only $18 for upgrade activation charges.
Math: $70 voice/data $15 taxes&fees= $85/month x 24months= $2,040.00 $199 iPhone 3G 8GB $18 upgrade activation= $2,257.00, and with messaging: $70 voice/data $5 messaging $15 taxes&fees= 90/month x 24months= $199 iPhone 3G 8GB $18 upgrade activation= $2,377.00.
If you want to take advantage of the iPhone OS 2.0 features and access a business Exchange Server, you will need to fork over $45/month for the data plan that doesn't filter Exchange network services, as is done on the cheaper iPhone 3G data plan. This will also reportedly be the case with the original EDGE iPhone, btw.
So, for the added ability to sync your work e-mail and calendar, a conservative minimum of $105/month or $2,737.00 over 24 months with entry level iPhone 3G 8GB, entry-level voice plan, entry-level messaging and $45 Enterprise data plan.
Math: $85 voice/data $5 messaging $15 taxes&fees= $105/month x 24months= $2,520.00 $199 iPhone 3G 8GB $18 upgrade activation= $2,737.00
Why doesn't AT&T advertise true monthly costs with taxes and fees? Because taxes are ugly and fees are even uglier. Well... and fees are a giant lie.
Based on their latest financials, AT&T has 71.4 million wireless subscribers. So even if every customer was charged only $1 attributed to so-called "non-recoverable expenses", that's $71.4 million dollars every single month that doesn't get attributed to service cost. $71.4 million dollars every single month that rather than report as income, they write off as an expense. And you know this $1 per month per customer math is polite. I would wager that AT&T's monthly take on "non-recoverable" expenses it far greater. I would be happy with a taste of that wager.
That AT&T, let alone Verizon or Sprint can forgo honestly stating true monthly service plan costs in their rate plan advertising is complete and utter FRAUD.