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Why AT&T May Deep-Discount the iPhone

businessweek.com — With competitive pressures mounting, the phone company may cut the iPhone's price to boost demand—and cement its relationship with Apple

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  • diggSJaustin, on 05/01/2008, -4/+44This rates very highly on both the "probably a load of crap" and "oh please let this be true" scales.
    • Eslamicolt3, on 05/01/2008, -0/+3Apple will never let it happen. Not that I wouldn't love to pay less money, but from a business standpoint it makes no sense. They have a hot property with the iPhone, it's already in high demand. Do you know how Apple continues to sell so many iPods while competing companies are scratching their heads wondering why they can't sell their cheaper MP3 player with more features for a little less money? It's the image. Part of that image is the price, and believe it or not the maintained premium price is a large part of why the iPod is perceived as a desirable product. Apple has already shown that it wears the pants in this relationship with AT&T. I highly doubt we're going to see a massive price reduction.
  • chrissku, on 05/01/2008, -15/+5
    Maybe because the economy sucks? That's usually why companies offer "deep" discounts on items.
    • youareretarded, on 05/01/2008, -2/+6"Maybe because the economy sucks? That's usually why companies offer "deep" discounts on items."

      Not for the video game, cellular, and Oil companies it doesn't.
      • chrissku, on 05/01/2008, -3/+12Oil is not going to get any cheaper. Anytime a resource is dwindling it will climb in price, not drop. Simple economics.
        • Ethdawg, on 05/01/2008, -0/+3True, except that the oil industry is a special case because it's an oligopoly with market control.
        • omgwhereami, on 05/02/2008, -0/+2Oil is not going to get any cheaper. Anytime a resource is completely controlled by a few people it will climb in price, not drop. Simple economics.

          fixed
    • litkaj, on 05/01/2008, -0/+7Won't matter, the second they drop the price of the phone they'll raise the cost of the mandatory data plan.
      • aywwts4, on 05/01/2008, -2/+2...or the other way around, ATT just won that bidding war for the spectrum right? They get the spectrum in 2009, and forgive my technical jargon, but once they have an assload of bandwidth, they will probably cut prices and raise speeds to leverage their position, while new Iphone subscribers are locked into a two year contract while sipping the internet from the slow-ass edge network and paying out the ass to do so.

        ATT's philosophy is 'Do Evil', so you have to be thinking of these things.
    • jerrycurley, on 05/01/2008, -1/+4No...low demand is why things get cheaper. That is the case here. Apple has not sold as many as they were expecting/hoping, and AT&T has not seen NEARLY as many people swtiching from other carriers to AT&T to use the iPhone.
    • lava, on 05/01/2008, -1/+3It's because T-Mobile is releasing an Android phone at the end of the year.
  • OfNumbers, on 05/01/2008, -8/+21I still won't be able to afford one.
  • willgonz, on 05/01/2008, -7/+5iPhones for everyone Yea!!!!
    • willgonz, on 05/01/2008, -2/+2I can't believe the Trolls on here digging people down because they like the iPhone. Will, live with it. They are still selling like hot cakes and having one just might get you laid!!
      • creoderiot, on 05/01/2008, -0/+3I hope you've got more going for you than that.
        • willgonz, on 05/01/2008, -0/+1You should see the girls that flock in a bar when someone brings out an iPhone. That is the easiest in.
  • TheDeadDodo, on 05/01/2008, -29/+3iPhone sucks! Windows Mobile is better, and the next version (which copies all the iPhone's features, but does a half-assed job) will kill Apple and its gay CEO, just like the Xbox 360 killed Nintendo!
    • PhattyPhattMatt, on 05/01/2008, -5/+2you have to have money to be able to get any  product, sounds like you dont have any  products... therefore you are mad.
      • nmnnotmyname, on 05/01/2008, -1/+5Stop using 0xF8FF already. How do you not know by now OS X is the only OS that supports that?
        • PhattyPhattMatt, on 05/01/2008, -2/+1i just got a mac, still learning... thanks for the help!
        • nmnnotmyname, on 05/01/2008, -0/+1Alright, didn't know you were a beginner. There's like 200 other people here who go ramped posting Apple logos, and it's easier to flame.
        • PhattyPhattMatt, on 05/01/2008, -2/+1its ok, can we be friends again?
        • nmnnotmyname, on 05/01/2008, -1/+1We can be not-mutual-enemies, but I won't support someone who says people who don't support Apple just can't afford their products. I certainly can afford them, but I have other reasons to not use them. (And it's not because I depend on apps either, that has never stopped me before...)
        • PhattyPhattMatt, on 05/01/2008, -2/+1i can live with that... thanks, i feel better now.
      • TheDeadDodo, on 05/01/2008, -8/+3Apple is for gay atheist Obama loving liberals (that hate our freedom) who like pretty things and "usability" (lol). Real computer users don't need usability!
        • nmnnotmyname, on 05/01/2008, -3/+1Wow, you've topped the parenting comment in stupidity by a long shot. congrats.

          (And by your logic Linux should be just fine, but i doubt you believe that, as most people with this sort of logic don't)
          • TheDeadDodo, on 05/01/2008, -4/+1Linux is made by socialists and deprives Microsoft of its God-given right to profit by giving things away for free. Also, Red China uses it, so it must be wrong.
          • nmnnotmyname, on 05/01/2008, -0/+1I can't believe how full of ***** you are.
      • Chiphort, on 05/07/2008, -0/+1i use an apple, and I support Hillary
    • nmnnotmyname, on 05/01/2008, -3/+3Windows Mobile lol.

      What's their slogan? 'Well at least it's not as bad as Windows CE'?
      • TheDeadDodo, on 05/01/2008, -6/+0No. Their slogan is "Made in the USA". Mac OS is made in Spain, which is part of Europe. So the choice is easy; support the US or European socialism. I can already see which side you're on, comrade.
        • nmnnotmyname, on 05/01/2008, -1/+3Will you gather all of your retard-friends out of the US and go to some other communist country that aims for world domination?

          Oh, and BTW, posting this from Linux 2.6.25 GIT, Firefox 3 alpha 5. bitch ;)
          • TheDeadDodo, on 05/01/2008, -3/+0Why do you hate our freedom?
          • nmnnotmyname, on 05/01/2008, -0/+2Why does everyone with your logic ask stupid, unrelated questions that aren't even considered valid responses? Seriously, America is not the country for you. On the other hand, you fight competition. Why do you hate our freedom to choose? Do you believe it is wrong to have competition? You believe, American companies should always be placed above the others even when they do better? Why? Because it provides American jobs? You want America to rule the whole world, like a monopoly?
          • TheDeadDodo, on 05/01/2008, -3/+0Just what a communist would say. Why am I not surprised? Go sip on your 20 dollar latte while soldiers are dying for your freedom in Iran. And is the whole American company thing rhetorical or what? American companies should be supported because they promote freedom (like it says to in the Bible), whereas the competition is funded by terrorists, atheists, Europeans and all sorts of weirdos. Do you really want them to win?
          • HonoredMule, on 05/01/2008, -0/+2I don't need my freedom in Iran, I need it at home.

            Ironically, it is American companies that deprive me of that freedom. Oh, and you'll have to show me a quote for that "promote freedom" crap.
          • nmnnotmyname, on 05/01/2008, -0/+3Being full of ***** is one thing, but I'm convinced that TheDeadDodo is actually, in fact, *****.
          • TheDeadDodo, on 05/01/2008, -3/+0I on the other hand, am convinced that everyone replying to my string of posts is astonishingly gullible. Guess why.
          • nmnnotmyname, on 05/01/2008, -0/+2Gullible to what? If your BSing, then quit. People actually think that way. Scary, huh?
    • Splitthebiscuit, on 05/01/2008, -0/+2wow...you seem to know SO much about these products.
    • SnuKs, on 05/01/2008, -0/+5Wow. And you must be enjoying your HD-DVD as well. Fanboyism is ***** lame.
    • itchytooth, on 05/02/2008, -0/+1Good Lord. Give it up TheDeadDodo - These folks aren't even clever enough to play with.

      P.S. I dugg you down, just for the hell of it.
  • stevetron, on 05/01/2008, -3/+8We lose a little on every sale, but we make up for it in volume!
    • PhattyPhattMatt, on 05/01/2008, -1/+3its simple economics.
      • nmnnotmyname, on 05/01/2008, -0/+1"And I don't understand any of it"
    • norcalscan, on 05/02/2008, -0/+1Hmm, band candy bar fundraisers. Sell them for 95cents and donate a nickel to the cause. I outsell all the classmates and a few dollars of my own guarantees I get the glow-in-the-dark soccer ball prize.
  • bernandoo, on 05/01/2008, -10/+4If Verizon got the iPhone, I would be all over it. I just hate AT&T and won't buy an iPhone regardless of the price.
    • Splitthebiscuit, on 05/01/2008, -1/+6man...too bad Verizon turned it down when they were offered it to begin with.
    • magicman0, on 05/01/2008, -2/+1Yeah... same, i haven't had any experience with AT&T but since I have Verizon and love Apple products, I wish they would make a deal with Verizon. I would so buy one
    • Lionhart, on 05/01/2008, -2/+8I switched from Verizon to ATT to get the iPhone. I am paying pretty much the exact same amount per month that I was paying for my ***** Verizon RAZR, but i'm getting unlimited data and rollover minutes. Yeah there's been a few dropped calls here and there, but overall i'm much more satisfied. Verizon is just way too overpriced these days.
      • TeraRealm256, on 05/03/2008, -0/+1You say you're paying the same amount that you were paying with verison? Then you say that verizon is overpriced? Get your story straight here!
        • Lionhart, on 05/04/2008, -0/+1Yes... because with Verizon I had a RAZR which only had Voice and Text messages..whereas with ATT I have an iPhone that has unlimited internet access data plan... I am paying the same amount but getting more services. So yes, if I am paying the same but getting more, then I am getting a better deal, thus Verizon is overpriced.
    • bernandoo, on 05/01/2008, -2/+1I have a blackberry for work on AT&T and have hated it. It's the only reason why I still have a personal cell on Verizon.
  • Bluezdood, on 05/01/2008, -4/+10This would be a very smart move on AT&T's end. I bet they would double their subscribers if they offered this. I know I would be tempted to switch, though I'm on a family plan with Sprint and I've never had an issue.
    • jerrycurley, on 05/01/2008, -6/+0Doubled their subscribers? Sorry, sir, but you are an idiot.

      Plain and simple...the iPhone is NOT the iPod. It is like all OTHER Apple products. Something that mainstream does not want. I really am not sure why everyone on Digg is under the impression that everybody thinks of Apple as this great comany that everyone wants every product that they make. It is simply not the case.
      • dudefaceguyman, on 05/02/2008, -0/+1Because the iPhone being that it's among the top selling cellphones, THE top cellphone used to surf the web, THE top cellphone that upload pictures on Flickr, Top every ***** thing in the book....Means everyone hates it.

        and as for their computers. They even smash the PC Windows (and linux to a lesser extent) retail giant Dell and with even all PC manufacturers together they keep a HIGHLY respectable marketshare considering they are the only ones making their computers. Their laptops are EVERYWHERE, especially in schools and iTunes is by FAAAAAAAAAAR the top place to buy music online.

        ....


        ..But someone prolly made all of this crap up huh?
  • leerayIG88, on 05/01/2008, -17/+5....................../´¯/)
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    .....Just Because
    • Tyr7BE, on 05/01/2008, -0/+1No that's cool. This is the proper response to yet another iPhone story.
  • username7D8, on 05/01/2008, -2/+22You'll get my business when you pay my $150 termination fee to switch over. Now that's a great idea to get customers attention!
    • ethanpack, on 05/01/2008, -1/+4Exactly.
    • RomeyRome, on 05/01/2008, -0/+11Man would the carriers hate that.
    • Nocturnal, on 05/01/2008, -0/+5Nextel used to do this but they were sued by other carriers for unfair business practices. They no longer do this. They stopped about four years ago.
    • Pilot85, on 05/01/2008, -1/+3termination fee. It costs them that much to turn a number off? *****.
      • RomeyRome, on 05/01/2008, -0/+3It's to make up for the subsidized phone. You can probably pay full retail for a phone & sign on with no contract I assume.
  • Harrison88, on 05/01/2008, -5/+3Because O2 do it and it sold a lot more?
  • shyboy2008, on 05/01/2008, -17/+5I hope they discount the iphone so i can use my old one as a dildo...............a dildo..............a dildo...............a dildo..............a dildo...............a dildo............a dildo
    • aloser, on 05/01/2008, -3/+1Dugg you up because you made me think "WTF?"
  • Splitthebiscuit, on 05/01/2008, -8/+3I wish they would work in some kind of trade in value for the people that bought them when they first came out instead of just price dropping one for people who get a new 2-year contract. That is, of course, if it's even going to be all that different for me to care about getting a newer one.
    • ravage86, on 05/01/2008, -1/+1That doesn't make any sense. You want the discount, but you'll only appreciate it if you're the only one who gets it? Who cares why you get it, as long as you get it. If you got your wish, all you'd be doing is screwing over other people.
    • toekneebullard, on 05/01/2008, -0/+1There's a price to be paid being an early adopter. Especially when it comes to Apple. If you're willing to buy it just cause the company tells you it's great, why would they give you discounts later? Discounts are for people who don't buy the hype.
  • Xfrost4, on 05/01/2008, -2/+1I already have a 2yr contract with AT&T, so, what is it going to cost me to get the damned phone?
    • theRick119, on 05/01/2008, -0/+0you can actually get the i phone for the original price without having to sign a new two year agreement right now. I don't know what it will cost when the new version comes out. maybe they will the discount to existing customers too
  • NonLeftistDiggr, on 05/01/2008, -7/+2Because it is a mega-expensive toy..... wasn't the answer?
  • ExRe, on 05/01/2008, -2/+9Obligatory ***** AT&T (even more so since recently they threatened my grandma).
  • Snuff99, on 05/01/2008, -3/+1I got $150 on it.
  • petethepanda, on 05/01/2008, -3/+1I switched to AT&T a few months ago and have been patiently waiting for the 3G iPhone. I'm going to be ***** if they actually do this discount and I can't get one since it won't be with a new contract. But I don't really know how that would work.
    • SnuKs, on 05/01/2008, -0/+4Why didn't you switch when the phone actually comes out?
    • milkmage, on 05/01/2008, -0/+1you're already on ATT? on the lowest cost plan? I got the cheapest plan, a free phone from ATT a couple of weeks before I got my iphone. when the phone finally arrived, I swapped the SIM from the free phone, put it in the iphone and activated it via itunes. I had to "upgrade" my plan to include data.
  • cyborg, on 05/01/2008, -4/+1my old iphone got stolen, kinda hope this is true. =/
  • eavesdrop, on 05/01/2008, -3/+1The 100$ plan for it is still not attractive.
    • xoineg, on 05/01/2008, -0/+1my current plans runs for less than 80 and i have to pay The NYC tax....
  • rowlodge, on 05/01/2008, -1/+2when's the free iphone, 2 year contract coming ?
  • nmyra, on 05/01/2008, -5/+2That would be a sad day for hardcore Apple fans...just like the iPod, the iPhone too will lose its exclusivity among the tech elite.
    • fuzed, on 05/01/2008, -0/+2Boy I hope thats sarcasm...
    • allanak, on 05/01/2008, -0/+1Tech elite? iPhone is (at least currently) for those who *think* they're the tech elite. Lack of copy and paste after almost a year? Jesus christ. It's getting there, but not quite yet. 3G and GPS are a step in the right direction but when I can tether high-speed data like I can with my 2 1/2 year old Windows mobile phone MAYBE I'll switch and I'll still have to consider leaving for AT&T *blech*
  • cadmiumpaint, on 05/01/2008, -1/+1"Some have suggested, for example, that Apple might try to argue that the new iPhone isn't covered by the exclusive rights given AT&T for the first edition, and thus walk away from AT&T"

    that would be so rad if they could get out of the AT&T deal like that and sell the iPhone 2.0 on say Tmobile
    • macslut, on 05/01/2008, -2/+1Did you just say, "rad"?
      • cadmiumpaint, on 05/01/2008, -0/+1no, i typed it. its a good word. It should come back. =)
  • Infectedbull, on 05/01/2008, -2/+1At half the price, I'll take two.
  • macslut, on 05/01/2008, -0/+2I can't take this anymore!
  • uberamd, on 05/01/2008, -2/+3Whats next? "Why Microsoft May Stop Vista Sales Tomorrow"??? Whats with all of this speculation about the iPhone? Guess what, if the iPhone becomes LESS than $300 for an 8GB model, the iTouch had better cost only $200 and not the $300 it costs now. Why? Because who would pay $300 for a iPod when they can get a iPod with a phone attached for the SAME price?

    So there we have it, if the iPhone becomes less than the $400 it is now (because we ALL know its possible to get around phone activation so you can in theory easily use your iPhone as an iPod without phone service) then the iPod Touch will be reduced down to $200-250, which means the normal iPod will be reduced from $250 to $150-200, then the iPod Nano will be reduced to $50-100, then the iPod Shuffle will be reduced to $0-50. Hm... see anything wrong with this pricing scheme? By cutting iPhone prices, all iPod devices would in turn need a price cut. I rest my case.
    • zomgwtfninjabbq, on 05/01/2008, -1/+1You obviously do not read well this special rebate is being offered only through AT&T and requires a 2 year contract. They are not reducing the price of the Iphone. This is not a move by Apple it is, once again say it with me a rebate that requires you be locked with AT&T for 2 years. Good job though coming up with a new price plan for apple! 5/5 for your ranting skills
      • uberamd, on 05/01/2008, -0/+1Yeah through AT&T, however with the way AT&T sells iPhones now (I purchased mine from them) you activate the phone from your computer and initiate the contract that way, so if they did this they would need to modify that system which I doubt they are going to do. Maybe they will, but still, $200 for the iPhone + 2 year contract + $150 to cancel the 2 year contract = $350 for the iPhone VS $300 for the iPod touch. $50 more to upgrade your iPod Touch to an iPhone? Still not a bad deal.
  • idslite, on 05/01/2008, -0/+2I don't really care about the price of the iPhone, but I do care about the monthly bill. If they drop the price of the bill to like um $35 a month instead of the ridiculous $60. It may see a huge increase in demand. And I might be able to buy the "2.0" one when they come out heh.
    • mparker7410, on 05/01/2008, -0/+1Any smart phone with web surfing abilities costs at minimum $60 a month for service. The iPhones plan is broken into Voice and Data, the data portion costs $20. Cancel the $20 data portion of the plan and the monthly cost is about $40.
      • idslite, on 05/01/2008, -0/+1Ah well, I would need the Data for accessing the web at my grandparents when I'm there... They only have dial up because they live in the middle of no-where basically (Up in the thumb of Michigan). So it would be nice to access a high speed (hopefully 3G when the new iPhone comes out) internet connection somewhere up there.
  • zomgwtfninjabbq, on 05/01/2008, -1/+0You obviously do not read well this special rebate is being offered only through AT&T and requires a 2 year contract. They are not reducing the price of the Iphone. This is not a move by Apple it is, once again say it with me a rebate that requires you be locked with AT&T for 2 years. Good job though coming up with a new price plan for apple! 5/5 for your ranting skills
  • elambing, on 05/01/2008, -0/+1i would buy it if they did in fact drop the price. right now $500 (even with a 2 year agreement) is way too steep for me. plus you add in those monthly bills and... yeah. i do want one though :(
  • ajfunk, on 05/01/2008, -0/+1Discounting an iPhone after a year of being out is essentially the same thing as predicting when the killer in a big budget slasher movie is gonna murder the vulnerable, uber-sexy victim. Yawn.
  • SoxFanNH, on 05/02/2008, -0/+2So now they will actually sell it for a reasonable price...
  • FunkyNuts, on 05/02/2008, -0/+1"It's like déjà vu all over again."

    - Said the head of the Department of Redundancy Department
  • gthrank, on 05/02/2008, -0/+1Look at the monthly costs going up, not just the upfront device price going down. The net revenue to AT&T is HIGHER than before, not lower.
  • kkcoolj, on 05/02/2008, -0/+1No wonder why the news magazines have declining subscriber bases. Where's the journalism? It's pure speculation and sensationalism on BW's part. How about reporting on the fact that savvy consumers are finding ways to sport shop AT&T and applying rebates that aren't marketed or publicized against the iPhone to get a lower final price like this one:
    http://www.essistme.com/2007/08/20/apple-iphone-di ...
  • mojotooth, on 05/02/2008, -0/+1According to the article: "With every passing month, rival device makers are introducing new handhelds that attempt to replicate the wide array of innovations... that Apple used to rock the wireless world less than a year ago."

    Can someone please tell me exactly which handhelds those are? I'm not asking that to make some sort of argument, I really am asking honestly. Who has an upcoming iPhone killer?
    • pilot101, on 05/04/2008, -0/+0htc dream for one, which will feature android platfrom, and htc diamond and raphael, which are both very powerful smartphones.
  • TROY7, on 05/06/2008, -0/+1Slashing prices is always a good thing.
  •  

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