AT&T paying Apple $325 per iPhone 3G

[xintelinsanex]

AT&T paying Apple $325 per iPhone 3G? | One More Thing - CNET News.com

Barron's Tech Trader Daily spotted a report from Oppenheimer's Yair Reiner that claims Apple will wind up getting just as much revenue from the subsidies as it did from the revenue-sharing agreement between Apple and AT&T that was in place before the introduction of the iPhone 3G last week. Reiner notes that this figure is far more than the typical $200 subsidy most carriers pay to reduce the price of other smartphones, and it's supplemented by a $100-per-new-subscriber bounty paid to Apple for each new AT&T customer that signs up in an Apple store.

Basically Apple is getting $225 in subsidies payment plus $100 per new AT&T customer that signs up for the iPhone 3G. AT&T can afford this because they are moving all iPhone 3G customers to the more expensive $30 data plan than the standard $20.

 

[xintelinsanex]

One more thing.... looks like this is going to go on for the remainder of the AT&T Apple exclusive partnership. I think the $200 subsidy is going to stay firm and the $100 per new subscriber is going to decrease over the life of the partnership.

 

[IrishJK09]

New info about this, new info about that... When is someone just going to announce what the "to be determined" price for non-eligible subscribers is going to be?!?!

Not directed at you xintelinsanex.

 

[xintelinsanex]

Haha it's all good. Rest assured once I read or hear something, I will share it with you and the rest of the forum readers. Stay tuned.

 

[IrishJK09]

Wait, I just read the actual article (kind of...) and put two and two together.

If At&t is paying Apple $525 for the 8gig and $625 for the 16 gig, that means that people in my situation are in trouble. The non-subsidized price for this thing could very well end up at around $600 and $700 for the two models respectively...

If that ends up being true, there will be no 3G iPhone for me... Dammit.

 

[volsfan0911]

New info about this, new info about that... When is someone just going to announce what the "to be determined" price for non-eligible subscribers is going to be?!?!

Not directed at you xintelinsanex.

I posted a response from ATT on another thread. Summary - I got a BB 8310 in 10/2007, signed 2 year agreement. Asked if I could get new iPhone for $199/$299 at release in July of this year. They said yes but I'll be signing a new two year agreement to get it. Only 9 months into a contract and my ATT account profile says "I may be eligble to upgrade 10/27/08 to a new device". So, you apparently can get a new iPhone in July but you'll just have to sign your life away for 24 months from then.

 

[IrishJK09]

Because I never thought this situation would arise, I wasted my upgrade about 3 months ago. That means I am only about 3 months into my contract. Not quite the same.

 

[xintelinsanex]

Wait, I just read the actual article (kind of...) and put two and two together.

If At&t is paying Apple $525 for the 8gig and $625 for the 16 gig, that means that people in my situation are in trouble. The non-subsidized price for this thing could very well end up at around $600 and $700 for the two models respectively...

If that ends up being true, there will be no 3G iPhone for me... Dammit.

Wow yeah, it might be a really hefty non-subsidized price. We'll see.

 

[HymerSchmidt]

New info about this, new info about that... When is someone just going to announce what the "to be determined" price for non-eligible subscribers is going to be?!?!

Not directed at you xintelinsanex.

Here is a pretty good article about this, sir: Gizmodo

That should resolve some of your questions.

 

[IrishJK09]

Here is a pretty good article about this, sir: Gizmodo

That should resolve some of your questions.

Right, I have read that. I just want to know what the price is actually going to be. If it ends up being $600 for an 8gig and $700 for a 16, they can keep their phone. (Thanks for the link nonetheless though HymerShmidt)

The first gen debuted at $500 for the 4, $600 for the 8 and was almost immediately dropped to $300 for the 4 and $400 for the 8. They discontinued the 4 and added the 16 for $500. Adding 3G and GPS should not increase the price by $200. No way, no how.

The more I think about it, the more I come to the conclusion that the analyst who made this claim of At&t buying the phones from Apple for $524/$624 is on crack. The article is vague and the "analyst" doesn't seem to quote any real sources. On top of that, the links don't even go to his "story," but to the website of his company instead.

Maybe it is just wishful thinking on my part, but I need something to keep me optimistic with all this speculation going around...

 

[alex.stef]

Those at Apple are experts in getting lots of money for their gadgets, so this is no wonder...

 

[Reaktor5]

I'd much rather pay the $325 up front to Apple than $10 more to AT&T a month.

 

[xintelinsanex]

I'd much rather pay the $325 up front to Apple than $10 more to AT&T a month.

Than you would be on the losing end if you consider cost alone. But if you include 3G speed, than yeah you would win.

 

[xintelinsanex]

Those at Apple are experts in getting lots of money for their gadgets, so this is no wonder...

Yes they are. I think they are one of several companies that have some of the highest profit margins on their products.

 

[Dandman]

I posted a response from ATT on another thread. Summary - I got a BB 8310 in 10/2007, signed 2 year agreement. Asked if I could get new iPhone for $199/$299 at release in July of this year. They said yes but I'll be signing a new two year agreement to get it. Only 9 months into a contract and my ATT account profile says "I may be eligble to upgrade 10/27/08 to a new device". So, you apparently can get a new iPhone in July but you'll just have to sign your life away for 24 months from then.

The highly skilled AT&T tech told be the same thing tonight. 10 months into my contract.