Rogers Tries (And Fails) To Appease Angry iPhone Buyers As Belgians Contemplate $1,000 iPhones

from the ain't-so-cheap dept

Part of the supposed appeal of the new 3G iPhone when it was announced by Steve Jobs a few months back was that it was going to be much cheaper than the old iPhone. That was true until you actually looked at the fine print. The $199 pricing only applied in the US to those who signed a long-term contract with AT&T -- for which you had to pay higher service fees. In other countries the story was also questionable. Up in Canada, the only national GSM provider, Rogers, caused a stir with ridiculously high service plans. After a rather loud protest, Rogers has pretended to relent by having a limited-time offer for cheaper data rates, though still not offering an unlimited plan. This has potential customers still pretty ticked off:

So, all early adopters that will ever be interested in the iPhone will have to buy by August 31. It's a ridiculous idea, and an obvious attempt to turn a concession demanded by the market into a cudgel against its customers -- not only can you not have an unlimited plan, but you can't buy at your leisure -- for example, waiting a few months to see if users reports overcharge horror stories from Rogers' miserly plans. You have to "buy now!!!, this offer is **limited**" What nonsense. If the plan is a bona fide effort to respond to a recognized customer need in a responsible manner, it should not be time limited.

Meanwhile, folks over in Belgium have a different problem. Due to laws forbidding the entirely reasonable practice of bundling goods together with subsidized pricing, you can only buy the phone at full price: which works out to nearly $1,000. On the good side, this has highlighted how dumb the "no subsidized bundling" law is, and politicians are looking to toss it out this fall.

Filed Under: belgium, canada, iphone, prices
Companies: rogers

The Real Price Of The iPhone: $599

from the hey,-that-sounds-familiar dept

As was widely expected, it turns out that all the hype and fuss about the iPhone costing $199 was really hiding the key facts: it's only that price if you're buying it in the US, along with a long term contract with high service fees. At first it actually appeared as though the only possible way you could buy the phone was with one of those contracts. However, AT&T has now admitted that it will indeed sell the phone without a contract, but the price will be $599. While some unlockers may find that worthwhile, it's probably a bit much for most. Still, this once again highlights how Apple's predictions that it was going to change the economics of the mobile phone industry haven't actually been true. There are plenty of mobile phones out there that you can buy subsidized under a contract, which cost 3x as much without a contract. So, rather than changing the economics of mobile phones, Apple has now completely bought into them. Update: Of course, as some are realizing it's actually cheaper to buy the subsidized version and break the contract. The early termination fee is less than the difference here, so you end up doing better that way.

Filed Under: iphone, pricing, subsidies, unlocking
Companies: apple, at&t

It's Good To Be A Monopoly: Rogers Prices iPhone Service At 2 Arms And 2 Legs

from the what-else-are-you-gonna-do? dept

There's been a fair amount of complaining about the pricing of the new iPhone 3G over the last few weeks. While plenty of people were initially enamored by the cheaper price for the actual phone in the US (and in some other countries), this subsidized low price often hid higher service fees (with a locked contract) that came with it. However, it appears that the folks at Rogers Communication up in Canada really went overboard in its service pricing: offering very expensive service fees that have excessively limited data amounts (and no unlimited data offering). Users also get less talk time. Basically, these service plans make the iPhone a hell of a lot less appealing -- but since Rogers is the only carrier offering the iPhone in Canada, it feels it can get away with such high prices. But, the impressive thing is that people are trying to fight back, putting together a petition against Rogers' decision. While online petitions are notorious for their ineffectiveness, this one seems to be getting an awful lot of attention -- creating a ton of negative publicity for Rogers. If the company has any sense of the harm negative publicity can do, perhaps it will rethink its pricing strategy.

Filed Under: canada, expensive, iphone, service
Companies: apple, rogers communications

iPhone Pricing Details: Getting iPhones To Unlock Just Got A Whole Lot Trickier

from the can't-play-that-game-any-more dept

When we wrote about the iPhone pricing immediately after the Steve Jobs keynote, it wasn't entirely clear what the details were, and if AT&T/Apple had shifted to a typical carrier-subsidized model. However, the details quickly became clear. Indeed, Apple and AT&T ditched the deal they had last year, whereby Apple actually received a cut of AT&T's service fees. Instead, AT&T is buying the devices directly from Apple and then selling them (at a loss) to customers who will need to sign up for a more expensive service and a two-year contract (rather than the old one-year contract). Basically, this is back to the traditional model of mobile phone sales -- which Apple had suggested was a thing of a past just a year ago.

Either way, though, the deal works out fine for Apple. It still gets the full price it needs to get on the iPhones and doesn't have to worry about recouping service fees from folks who unlock iPhones. AT&T, on the other hand, now becomes a lot more reliant on service fees, first to make up for the loss on the device sale, and then to show growth in its 3G network usage. To that end, it appears that AT&T has totally ditched the old model where you could buy an iPhone and "activate" it on your own. No more. Now you have to both buy and activate the phone in stores. You can't order the phones online and have them delivered to be self-activated. In Engadget's post, the writer seems confused by this, and quotes AT&T's bogus claim that it did away with self-activation because the company "found that many others wanted to complete purchase and activation in one step so they could walk out of the AT&T store with their iPhone up and running." If that were the case, they could have just added in-store activation, without removing the option for self-activation.

The real reason seems pretty obvious: if you have to both buy and activate the phones at the same time and they require a two year contract, it's a lot trickier to get your hands on an iPhone for unlocking purposes. Since the full process is supposed to happen at once, it seems unlikely that stores will be letting people walk out the door with an iPhone that doesn't also have a contract. Those hundreds of thousands of unactivated iPhones that disappeared into China? Not so easy this time around (of course, you'll also note that the new iPhone will be available in 70 countries, so they're trying to stamp out the issue from the supply side too). Yes, there will still be 3G iPhones out there that can be unlocked, but that market is going to dry up significantly and cost a lot more.

Filed Under: iphone, pricing, subsidies, unlocking
Companies: apple, at&t

Steve Jobs Back To Being A Fan Of DRM In iPhone 'Bundle'?

from the let's-pretend-we're-bundling-music... dept

This has been rumored for some time, but the Financial Times is reporting that Apple is trying to negotiate with the record labels for a new offering that would provide access to music as a bundle with an iPhone. The idea is that you could buy the iPhone and get "unlimited" access to music, either in a lump sum or with a subscription fee. Of course, there are some rather important caveats. While this would get a lot of attention, you only get access to the music for the lifetime of the device or subscription (if you didn't pay a lump sum). While there's a small concession that you'd get to keep 40 to 50 songs after the device died or the subscription ended, you'd lose the rest of the songs. In other words, despite Steve Jobs' supposed dislike for DRM, this music would be quite DRM'd. Limited subscription plans have been around for ages and they've never gone very far because of those limitations. People know better by now, and so should Steve Jobs.

Filed Under: business models, drm, iphone, itunes, music, steve jobs, subscriptions
Companies: apple

Apple's Walled Garden Will Hurt iPhone Innovation

from the barriers-to-entry dept

The release of Apple iPhone SDK got a ton of attention on the blogosphere. Personally, I found the announcement to be a huge disappointment, because the rules for getting applications on the iPhone are chock full of restrictions. TechCrunch notes some of the major ones: No VoIP over the cell network, no exchanging data between applications, no multi-tasking (third-party apps quit when you switch out of them). But the more serious problem isn't strictly technical, but contractual: the only way to get third-party applications onto the iPhone is through Apple's "App Store." And Apple plans to carefully monitor the apps available through the store. Apparently "porn, privacy-breaching tools, bandwidth-hogging apps, and anything illegal" are examples of what will be off-limits, but that's not an exhaustive list.

The problem here goes beyond the mere possibility that Apple might block apps that some users would find useful. The more serious problem is the effect that the approval process will have on developers. Given how vague the rules are (what counts as bandwidth-hogging?) and that Apple is free to change them at any time anyway, it's going to be risky for a developer to start developing an iPhone app that Apple might reject. TechCrunch wonders, for example, if Apple would allow an app to download songs from Amazon's MP3 store. To avoid a nasty surprise at the end of the development process, any serious developer will want to talk to Apple ahead of time, but negotiating the feature set ahead of time could delay the product by months.

Perhaps most importantly, these barriers are going to be a serious disincentive to casual tinkering. Some of the greatest applications on the Internet -- including email and the Web -- were developed by one or two guys without the support of a large organization behind them. They were able to deploy their applications because the Internet (and the ARPANET in the case of email) didn't have any kind of approval process. You could just install your application and start using it. On an open iPhone platform, the killer mobile app might have been developed the same way. But if a developer has to spend a lot of time arguing with Apple's iPhone bureaucracy, they're likely to give up and develop the app for an open platform like Google's Android instead.

Filed Under: innovation, iphone, sdk, walled gardens
Companies: apple

Apple Sued Over Caller ID On The iPhone

from the seriously? dept

For all the talk about how Apple patented so many different aspects of the iPhone, it really hasn't stopped a ton of iPhone-related patent infringement lawsuits against Apple. Bill Squier writes in to let us know of the latest. Someone is suing Apple over a patent on the iPhone's caller ID feature. Yes, apparently, the patent covers matching up the phone number of an incoming call with a local contact database to display who is calling. Of course, the patent also talks about a two-line LCD display and a separate receiver, which aren't exactly a part of the iPhone these days.

Filed Under: caller id, iphone, patents
Companies: apple

Companies Baffled By iPhone's Success

from the who'd-a-thunk-that-making-something-people-like-works dept

Rob Hyndman points us to a news report on what must have been one of the more bizarre panel discussions at this week's Mobile World Congress event in Barcelona. It was a panel on the user experience of mobile phones, where a bunch of folks from other companies tried to puzzle out why people liked the iPhone so much, noting that people generally associated the iPhone more with Apple than AT&T (gee... wonder why?) What's amazing is seeing some of the execs trying to come up with solutions through more careful methodologies:

"One direction, advocated by Lucia Predolin... is to manipulate users by identifying their "need states" -- including such compulsions as 'killing time,' and 'making the most of it' -- and fulfilling them subliminally."

And that, of course, is exactly why no other company designed the iPhone before Apple. They're trying to overthink things and figure out how to manipulate users, rather than sitting back and saying "how can we build something cool that people like that doesn't suck the way existing phones do?"

Filed Under: iphone, telcos, usability
Companies: apple

Police Officers Can Search Your iPhone Following Arrest For A Traffic Violation

from the fourth-amendment dept

Adam Gershowitz writes "I am a criminal law professor from Houston, Texas and I have recently finished an article about the ability of police officers to search the contents of a person's iPhone at a traffic stop. In brief, under what is referred to as the "search incident to arrest doctrine," police can search through any container found on the body of a person who has been arrested. It does not matter that the arrest was for running a stop sign, or speeding, or some other seemingly minor traffic infraction. Regardless of the reason for the arrest, police can search through every container on the person's body, even if the police have no suspicion that there is anything illegal in it. A few courts have concluded that this doctrine permits police to search text messages found on cell phones. My article explores the circumstances under which police can now search not only text messages, but also the email, pictures, movies, calendar entries, and internet browsing history found on iPhones and similar devices -- even if the police have no suspicion that there is anything illegal on the iPhone. In short, the article explores ways in which the police can search through the thousands of pages of data on individuals' wireless technology even if there is no probable cause or other suspicion of illegal activity."

Filed Under: fourth amendment, iphone, police, privacy, traffic stop

Is The iPhone Damaging The Mobile Gaming Market?

from the not-really dept

It's amazing how much stuff gets blamed on the iPhone on a regular basis. The latest is that some "industry experts" (which, in this case, actually means very biased people) are claiming that the iPhone is hurting the mobile gaming market, by not letting users download games to their phones. Of course, that's about to change as Apple finally opens up its SDK, and more importantly it's actually a more fundamental problem than one that is just about the iPhone. It is rather difficult to move games from one phone to another, and at the rate that many people (especially the early adopters who are more likely to buy games for their phones) changes phones, it can be a pain to have to constantly rebuy mobile games that people want. Of course, that goes beyond mobile games to just about any mobile application. Right now there are so many different devices, operating systems, platforms and network operators, it's nearly impossible to feel comfortable that a single app will work anywhere but where you first set it up. It's a problem that the industry is going to face more and more as they push for people to use their phones as more than just phones.

Filed Under: iphone, mobile gaming
Companies: apple, ea