It means it will be treated like any other phone. Keeping it simple, it means you will pay a lesser price than full retail in exchange for signing a 2 year contract. Subsidy deals are only good for new customers, and/or existing customers up for contract renewal. Those of us that are in the middle of our contracts get jack and have to pay full retail price for it.
what i think will happen is much like the current iphone the new one will let you start a 2yr service agreement no matter ware you are in your contract . then discount will be applied to iphone 2 after 2yr contract
Basically, sign a new contract with AT&T get a discount on your iPhone.
Don't buy from AT&T and pay full price.
Extend existing contract and still get the discount?
I wouldn't mind seeing this happen (I mean its cheaper for us) but then again there are potential problems. For one, it gives the power back to the telcos, whom I don't particularly trust as much as Apple. Sure it could be cheaper but there might be a lot of annoying loops and fine print to comb through. Also, if discounts aren't offered for people on the original iPhone plan, they would be further isolating their dedicated customers. And finally, Apple didn't become Apple by putting their products on the clearance rack next to Dell and Gateway, will they really place the iPhone next to the Moto Q and Blackjack?
It's Apple. When everyone was slashing prices trying to make a sub $500 dollar PC, Apple built better computers and kept the premium on the price. Apple is unique as a company that manages demand and plays the market beautifully.
If subsidies do come, I'll gladly accept them. But i rather have it as a pleasant surprise than expect it and not receive.
If AT&T were to offer a subsidy, I don't think they will have enough iPhones in stock to meet demand. If people want to pay full price, they could get it the day it comes out through the Apple Store. Too bad the Apple Store won't let you get a subsidized iPhone. If I could renew my contract at the Apple Store, this would be convenient.
Apple should not give anyone anything. I think its a bunch of crap that the did in the first place. If you could not wait for something to come down in price you need to learn something called patience.
Typical subsidy on a 2 year contract is $150 discount off the full price. $75 for 1 year contracts.
So if the phone is $400, it should be $250 for a new subscriber taking a 2 year contract. That's they way it has been for all phones on AT&T, so unless they treat the iPhone differently, it this should be the case.
Some times there are mail in rebates but I don't expect there to be any on the iPhone.
The EFT (early termination fee) for breaking your 2 year contract is $175. Now that there are going to be pro-rated EFTs, I don't how that's different.
So if you plan to stay with AT&T for at least 2 years, it's worth taking the $150 subsidy. Even if you do leave early and pay the $175 EFT, you'd be paying $25 over what you would have paid for the full price of the phone. And of course now that there will be pro-rated EFTs it might make even more sense to do it.
What this means is if, for example you are with Verizon or T-Mobile, you'll be able to walk in to AT&T, "port" your number to AT&T, sign up for a 2 year contract, and get the iPhone for (presumably) $150 less than full price.
The port process would automatically cancel your service with the company you're already with. You'll get an early termination fee bill from them if you're still in contract or nothing if you're out of contract.