AT&T + iPhone = Free Year and a Half Service = Assault on Verizon
- 01-25-2007, 08:44 AM #2
I'm guessing there is something else behind this that we do not see at this point in time. It would probably be the last year and a half but why would they feel the need to offer such an unheard of incentive?
Any thoughts on why this is said to be directed at Verizon? Why not Sprint or T-Mobile? I have a lot of information about Apple in this little head of mine but I don't know jack about carriers. Thoughts?
It was stated that the iPhone would have a 2 year exclusive with Cingular. It was also stated that a new 3G model would be released soon after (about 6 months). Does this mean anything?
It could be that the phone really doesn't need to be subsidized at the asking price (especially with the recent reports of Apple seeing 50% margins). There are only a few other smartphones that are priced higher than the iPhone.
Guess I would rather pay a high price up front than get reamed throughout the year(s) in overpriced services.
This could be part of Apple's demands on Cingular (AT&T). If the service for some reason were not up to par in the iPhone users eyes (maybe a dropped connection as you drive out of range), they would be more inclined to ignore it considering it is free. This would be a brilliant move on Apple's part. Their approach to giving satisfaction with a service from a seemingly uncontrollable third-party!
- 01-25-2007, 09:00 AM #6
- 01-25-2007, 09:09 AM #9
I suppose if the data plan is a flat fee for unlimited use, the subscriber would pay for it but still see benefits from Apple's wi-fi switching in that it would provide better speeds at times.
- 01-25-2007, 09:55 AM #12
Think about it- what's Apple's biggest hardware drawback with this new phone? It may be the only hardware drawback actually. No 3G. Compensate for that flaw by giving away its data service for free? Makes sense, especially considering its costing people like me 40/month. And after that year and a half, they will find out that the "iPhone connect unlimited" plan is 50.00/month, free subscription to iTunes, etc etc.....text messaging not included of course. Makes sense, but this is obviously just my "conspiracy theory."
- 01-25-2007, 10:12 AM #13
- 01-25-2007, 12:14 PM #14
Cramer said AT&T is one of the most interesting stories coming out of the tech period. In its call, the company made it very clear that it's going to use Apple's (AAPL - news - Cramer's Take) iPhone to get customers from Verizon Wireless (VZ - news - Cramer's Take) by giving away its service for a year and a half to those customers who buy the phone. Perhaps this means all customers, not just those jumping ship from Verizon.
- 01-25-2007, 12:43 PM #15
Ahh...I can see it now, all those on Cingular....erm...excuse me...AT&T will once again get their favorite message when placing a call "System busy, try again later". It's good to know that at least you'll have visual voicemail so you can pick and choose who you want to hear (of course, if the data network isn't crammed with all the subs who switched over because it's free).
- 01-25-2007, 01:44 PM #16
- 01-25-2007, 02:33 PM #17
Taking the Industry by Storm
- 01-25-2007, 05:06 PM #18
- 01-25-2007, 06:10 PM #19
Shaking things up is an understatement....this would only be the beginning. It would be a revolutionary move. Here is a sidebar that I am now recalling that might fit into this puzzle. I attended ATT's National Focus Conference in San Diego this past August. This conference is a yearly coming out party for ATT products and services to their large/midsize corporate customers, where they feature keynotes, workshops, and exhibits. One of the discussions that came up after one of the keynotes during the question and answer period -- was about ATT's merger with SBC and the impending acquisition of Cingular (which was in the final stages of being finalized by the FCC). There were numerous questions about customer charges for services over the ATT/SBC network. I will try to paraphrase to characterize the questions here:
1) If ATT/SBC (The New ATT) owns the network that Cingular Cellular services operate and those networks are already joined to ATT's network, then why can't we get free in-Network calling to residential ATT customers in the same way we get free in-Network calls to other Cingular customers?
2) As there are potentially three (chargeable) components to a phone call originating from a cell phone, that is airtime charges between the cell tower and the handset, network charges for voice and data that travel a hard wired conduit to either a residence or another transmitting tower where another cellular phone receives a transmitted signal. In that scenario, cellular to celluar is more expensive because of the airtime transmission. But Cingular offers it free. Customers at the conference wanted to know then why can't cellular calls originating on the new Cingular/ATT network to residential phone services be offered free if they are calling ATT residential customers?
The Execs at the conference scrambled and back-pedaled a little to try to make sense of it, but admitted there was a savings and that they would have to look into it. Admittedly, ATT brass said they had put themselves in a good position to compete with the their latest acquisitions. Conclusion: ATT can offer be very profitable while lowering their profit margins because they own the largest network in the world. They can give away network time for fractions of a cent, which makes the iPhone give away seem more plausible. However I agree with you-copernicus-the devil is in the details.
Cingular has the most customers.
- 01-25-2007, 06:59 PM #20
- 01-25-2007, 07:24 PM #21
do we really see att/cingular giving away $1200-$1500 in fees? I'm guessing a $30 voice and $40+ data.
it would be so sweet if this were true. apple will sell their 1 bil phones, and in 12 months verizon would buy att wireless.
btw, i'm hoping it is true.
- 01-25-2007, 07:32 PM #22
All AT&T and Cingular talk about are increasing revenues and margins; I don't think giving away their most profitable services would be a great step in that direction. The Cingular guy on the conference call says that the iPhone "has lived up to the hype and then some" and that it's both the best phone in the world and the best iPod. Total inanity.
- 01-25-2007, 07:43 PM #23
- 01-25-2007, 07:55 PM #24
- 01-25-2007, 07:57 PM #25