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AT&T Under Fire


att3g Customer Uproar
Can anyone explain to me why iPhone 3G customers are up in arms about not getting a subsidy for the iPhone 3GS ? I’ve read many complaints that go something like this:
“I bought the iPhone 3G a year ago. Now AT&T wants me to pay $499 to get the new phone. Don’t Apple and AT&T want to reward their loyal customers?”

The obvious reply to that question: Do you think AT&T earns enough from your business after ONE month to cover the payment they made to Apple for your iPhone? No, they don’t. Two months? Still no. What about twelve months later? Well, maybe. But only AT&T knows for sure and they’re clearly saying they haven’t made enough back a year later. Otherwise they’d sell you another subsidized iPhone.

If iPhones came out every three months and AT&T always let you buy one with a subsidized price they wouldn’t make much money, would they? That’s real money AT&T is paying to Apple every time someone buys an iPhone and starts service with the carrier. It’s not a giant leap to apply the same logic to people who bought a 3G a year ago. Again, only AT&T knows when they’ve earned enough from your phone service to call the subsidy worthwhile for them.

MMS and Tethering
On the other hand, AT&T came out looking pretty bad after the keynote. No MMS until the end of summer? How can this be??! Two years wasn’t enough time to prepare? One year wasn’t enough time to prepare? Apple didn’t seem to mind putting the news out there either.

What about tethering? Is tethering a new concept to AT&T? How can they possibly not be prepared for this?

From Verizon to AT&T
I’m not a heavy mobile phone user. But I’m happy with the service I get from Verizon and my LG phone. Calls don’t drop, I always have a signal. Sure, unhappy customers are more vocal, but in the case of AT&T it seems like there’s some cause. Their showing on Monday didn’t instill much confidence.

I was going to write something about the ridiculous situation with text messaging and got sidetracked comparing U.S. carriers to those in other countries. But the plans are so completely different that it’s very difficult to make a comparison.

Still – twenty dollars for unlimited text seems ludicrous when compared to all-you-can-eat-data for thirty dollars. If thirty dollars is a fair price, $1 per day, then something is way out of control with texting charges. If AT&T profits even when I email a dozen video files from my iPhone why are texts weighing them down so much? Senator Herb Kohl is investigating, it will be interesting to see what turns up.

My problem? I don’t want to pay 20 cents for a text message. And I don’t want to buy 200 for $5 when I won’t use anywhere near 200. In a way I suppose the carriers deserve to collect what people will pay. Unless there’s collusion involved or it’s determined that text prices are artificially high based on the carriers monopoly status. I think the text market is in for a shake-up, one way or another.

If you want to see more of Murphy’s reaction to the WWDC keynote take a look at his post on SeekingAlpha.

Note: The new Macs are listed on Amazon, but not shipping yet.

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2 comments to “AT&T Under Fire”

  1. I’m ok with AT&T charging more to users who purchased a subsidized iPhone 3G. The MMS and tethering delays are unbelievable. AT&T dropped a huge ball here and I don’t expect the exclusivity contract to go beyond 2010.

  2. I think it’s because of the way the pricing was announced. Originally everyone heard $199 & $299, and were then surprised when they tried to pre-order and found no subsidy.

    I have an original iPhone, my contract is up at the beginning of July. I haven’t decided to upgrade yet, because my current contract gives me 200 texts FREE and unlimited data for $20/month, so the current terms are $15/month more expensive. And I haven’t seen the pricing on the voice contracts yet. I still have the terms from my 2000 Nokia phone contract.

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