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AT&T To Offer No-Contract iPhone
rfc1394 writes "While the regular price of an iPhone is $199 if you take a 2-year contract with AT&T, if you're willing to pay a lot more you can get one without a contract. An article in InfoWorld mentions that 'Freedom will come with a price — $599 for an 8GB device and $699 for a 16GB — but this will mark the first time consumers in the United States are able to buy an iPhone without being tied down to a two-year contract. The phone probably would still be locked for use only on AT&T's network, said Jupiter Research analyst Michael Gartenberg. But buyers could choose a pay-as-you-go plan for voice service.' The question still remains, does it make any sense to pay that much for a phone that is still locked to AT&T's network even if you aren't bound to a contract?" Update: 07/05 18:21 GMT by T : An anonymous reader suggests that there is a convoluted but possibly cheaper route to an new, unlocked iPhone.
So I buy a phone outright for $599/$699, or I buy a phone for $199/$299 with a 2 year plan ($36 activation fee) then cancel the contract immediately for $175...net cost $410/$510. Hmmmm.....
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Fail
As the ETF is probably only $150-200 or so, just get a phone for $200 and when you decide you hate AT&T, just break the contract.
What I worry about is this is the "tax price", so that in CA (and other states), you may pay $200, but you are paying tax on a $600 phone, which would up the cost to the end user an additional $33.
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Most phone companies have a stipulation in the contract that forces you to return the phone if you cancel the contract soon after starting it. In this case I would think that time would be about 6 months or so - enough time for them to squeeze out the 600/700 dollar cost.
"does it make any sense to pay that much for a phone that is still locked to AT&T's network even if you aren't bound to a contract?"
As Henry Ford once said of his Model T, "the customer can have any color he wants, so long as it's black." But only a cellphone company could call that a "custom color choice" and charge extra for it.
What if the phone gets "stolen"?
Well, you should have bought insurance.
"Well, good luck finding a judge that doesn't run a bestiality site."
The price quoted probably is a fair price. They are subsidising it. But that is priced out of the U.S. market, it is even at the high end of the Japanese market.
That price is what the Apple should sell the phone for to other phone companies, and they will then be able to provide service and subsidize some portion of it. The only value this announcement has is to tell people how much the subsidy was. The other poster has it right, Fail.
Maybe but in the case of AT&T they do not:
Cancellations/Early Termination Fee: An Early Termination Fee of $175 may be assessed against you in the event that you terminate your Wireless Service Agreement and/or selected plan before the expiration of its term. For Service activated on or after May 25, 2008, the Early Termination Fee will be reduced by $5.00 for each full month toward your minimum term that you complete. You may cancel your service, for any reason and without incurring the Early Termination Fee, within thirty (30) days of signing your Wireless Service Agreement, PROVIDED, however, that if you cancel service you will remain responsible for any service fees and charges incurred. If you cancel within three (3) days of signing your Wireless Service Agreement, you will be entitled to a refund of your activation fee, if any. If you exercise this option, you may be required to return devices and associated accessories purchased in connection with your Wireless Service Agreement.
So you wait until the 4th day.
The NSA: The only part of the US government that actually listens.
You would need to pay for 1 month of your contract ($70 is the cheapest?), if you cancel before 30 days you have to return the phone. Also, there has been no confirmation of the early termination fee being $175 for the iPhone. (if it were to be $175 you would still end up getting the phone a bit cheaper than going with the no commitment option).
Australians will enjoy the ability to buy a pre-paid iPhone and unlock it to work on any network for $80.
They have allowed unlocking because the laws here don't allow you to lock a phone to a given provider without a reasonable option.
When an OpenMoko is cheaper and has better hardware specifications?
Once you are out of contract, they are required by law to unlock your phone for use on any carrier, so selling a no-contract phone thats locked doesn't make a whole lot of sense, as they'd just have to provide an unlock code at your request anyway. I guess they'll probably do it just to make people who don't know any better use AT&T anyway.
Either way, the price makes buying an unlocked phone absolutely retarded. You pay the $199/$299 and pay the $175 contract early termination fee and save yourself some money. After paying the termination fee, they have to unlock your phone so you can take it where ever you want, sans visual voicemail of course.
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Here in the States, you are always locked into a provider, even if the phone is popular enough to be sold be more by than one provider. If the iPhone is supposed to be the future of computing in general, I don't know why it's only being sold as a phone. Or is it really only best used as a phone with a few other features? With the software base so limited, it's hard to tell. I would think Apple would sell these outright to people who want a portable computer (and then force you into AT&Ts maw if you still wanted to poen up the phone function). Palm was brilliant to open development to all comers, but Jobs' need for control is crippling an otherwise highly advanced piece of electronics.
You can't buy insurance from the carrier for high dollar phones such as the iPhone. People that buy them will buy another one if it gets stolen ( Well, okay, I'm buying another one to replace my stolen iphone on the 11th ). And its not really profitable for them to charge you a $20 insurance fee for a phone that they actually have to pay for, unlike all the other give-away phones that they don't mind insuraning because they are so cheap that the fee they charge you when you make a claim is more than the phone costs them.
Persistent Volume manager for Kubernetes - https://github.com/dwimsey/openshift-pvmanager
No, you don't get to keep it if you cancel within the 30 day "trial"(for lack of a better word), and DONT pay the early termination fee.
Monstar L
Just FYI... the new data plan with AT&T is $30/month while the old plan (Edge) was only $20/month
SO with the new phone you're already paying $120/year more than previous... which means people are actually paying more money over the 2 year period... $199 + $240 (2 year contract) = $459
A fool throws a stone into a well and a thousand sages can not remove it.
I see how you are getting this interpretation...
It's interesting to see just how ambiguous this section of the contract seems to be. Obviously, AT&T would agree with your interpretation. A court may not. Of, course, we don't want to pay court costs just to argue to try and save $189 dollars.
On the other hand, there have already been many iPhones bought and contracts cancelled, so if AT&T has NOT been demanding the hardware back after the 30 day period then they would be hard pressed to start doing so now. Anyone know if AT&T has been requiring the hardware back when a contract is cancelled?
The NSA: The only part of the US government that actually listens.
Just ordered my FreeRunner. Yes, it's $400, and yes it doesn't work perfectly yet but it's a big step up from what I have now (no phone at all) and the approx $10/month I will make in calls will be just fine with T-Mobile's PAYG vs being locked into yet another telco service contract.
Hey, um...did you read GP all the way? He's saying wait until day 4. Go back and read about one sentence before the part you quoted; it says you have to return the equipment only if you want to exercise an option to refund your activation fee and cancel within three days. We're not using this option - we're cancelling the normal way, by waiting until day four and paying the activation fee and early termination fee, so this doesn't apply to us. Even with all those fees added up, it's still cheaper.
I personally wouldn't buy the thing either way...
-- Joren
The 3 day "trial" is a full 100% refund. The 30 day "trial" is the same thing, but you don't get your activation fee refunded ($36) (for days between day 4 and day 30). Given this, after 30 days, you have to pay (1) 1 months worth of service (2) $36 activation fee (3) 199/299 for the phone, and (4) termination fee of 175 - and quite possibly a pro rated second month of usage (if any).
It usually works that if you cancel within the 30 days, you return the equipment and you don't need to pay the ETF. However, if you decide you want to keep the equipment, you'll probably be required to pay the ETF even though you're within the 30 days.
Probably the same with the 3 day thing (though the wording is rather ambiguous). If you decide not to receive a refund of the activation fee, as well as pay the ETF, you can probably still keep the hardware.
Yup.
Here is Roger's Early Cancellation Fee for the IPhone:
"The ECF is the greater of (ii) $100 or (iii) $20 per month remaining in the service agreement, to a maximum of $400 (plus applicable taxes), and applies on each line in the plan that is terminated."
So waiting a month and then canceling will cost you $700 vs $175 with AT&T
[alk]
FWIW, the iPhone box clearly states a 2-year agreement is required, as did/does the web site. One can be forgiven for not knowing about the prepaid option.
Wouldn't it make more sense to get the phone for $199 and pay them $200 for the contract termination fee?
This is getting better and better...
They have a special iPhone section ((4) iPHONE TERMS AND CONDITIONS): Terms Applicable to AT&T Nation/FamilyTalk® GSM Plans: Credit approval required. Subscriber must live and have a mailing address within AT&T's owned network coverage area. An early termination fee applies if service is terminated before the end of the contract term. The fee will begin at $175 per device and decrease by $5 each month for the term of the agreement. If phone is returned within 3 days, activation fee will be refunded. If phone is returned within 14 days in like-new condition with all components, early termination fee will be waived. Service may be cancelled after 14 days but within 30 days and early termination fee will be waived, but equipment may not be returned. All other charges apply. Some dealers impose additional fees.
So they explicitly say that you can cancel the service between 14 and 30 days, avoid the early termination fee, but don't have to return the iPhone. As an aside, this section also implies that the "you may be required to return devices" in the other part of the contract indeed only applies to the first 30 day period, but the explicit iPhone section makes the various interpretations of the other section mute for this question.
So, we can buy the iPhone outright for $599/$699 or we can get a contract and cancel it after 14 days (but before 30 days) and pay a net of $235/$335. As my son would say Sweeeet.
The NSA: The only part of the US government that actually listens.
AT&T has explicitly said that even without a contract you still have a locked phone and the same choices for plans (i.e. minimum $70 a month +taxes and fees for voice/data, with no sms).
That doesn't sound like pay-as-you-go is allowed to me. Which is a shame, because if it was I might actually be interested. A $500 phone, $30 a month for data, and a hundred bucks for a year worth of minutes and SMSes is a better deal for me than a $200 phone plus $75+taxes+fees every month for more minutes than I use in a year.
AT&T needs to let people who don't use their phone as a phone that much buy what they want.
"The worst tyrannies were the ones where a governance required its own logic on every embedded node." - Vernor Vinge
Sorry you're wrong. Insurance is definitely offered on iphones. I guess you don't know what you are talking about or regret not buying the insurance yourself because I have an iphone and I have insurance @ 4.95 a month w AT&T. That's pretty standard for a smartphone. Verizon charged me the same insurance fee when I had a treo.
All we need now are for some Canadians to reiterate how shafted they feel by their only GSM provider :)
Not just the monopoly GSM provider, but the CDMA providers as well.
Canada is in the dark ages when it comes to cell phones & service. The CEO of RIM (maker of the blackberry, a Canadian company) has said many times that the ridiculous prices of Canadian cell phone companies are impeding progress.
Canada has the highest prices in the western world when it comes to cell phones & service. As a result, just over half of the population has a cell phone. Compare with most of Europe when almost everyone has a cell phone.
The previous Liberal government fucked up big time when they allowed two big mergers (BC Tel with Telus, and Rogers with Fido), reducing the number of large providers from 5 to 3. Not surprisingly, prices went up quite a bit post-merger.
Canadian cell phone companies will whine and claim their costs are higher because Canada is such a large country with a small population. While that is true, the vast majority of the Canadian land mass has no cell phone service. The carriers are not incurring costs to provide service to areas of low population, they only provide service to cities & towns with sufficient population. As an example, Rogers (the only GSM carrier) provides service to about 2% of the land area of the province of Saskatchewan.
Canada's laws prohibit a foreign firm from operating a cell phone network. It's time to revisit this.
My iPhone sounds just as good as a land line.
It's better than I thought...current Terms of Service: ((4) iPHONE TERMS AND CONDITIONS): Terms Applicable to AT&T Nation/FamilyTalkî GSM Plans: Credit approval required. Subscriber must live and have a mailing address within AT&T's owned network coverage area. An early termination fee applies if service is terminated before the end of the contract term. The fee will begin at $175 per device and decrease by $5 each month for the term of the agreement. If phone is returned within 3 days, activation fee will be refunded. If phone is returned within 14 days in like-new condition with all components, early termination fee will be waived. Service may be cancelled after 14 days but within 30 days and early termination fee will be waived, but equipment may not be returned. All other charges apply. Some dealers impose additional fees. So they explicitly say that you can cancel the service between 14 and 30 days, avoid the early termination fee, but don't have to return the iPhone.
So, we can buy the iPhone outright for $599/$699 or we can get a contract and cancel it after 14 days (but before 30 days) and pay a net of $235/$335.
The NSA: The only part of the US government that actually listens.
So even if you fork out the full price for an unlocked iPhone you can still only use it on AT&T anyways? Absurd! With all of iPhone/Apple/AT&T restrictions it's amazing that people are still flocking in masses to buy the gadget. SHEEP!
Jessica
It's always possible to game the system if you're willing to defraud it sufficiently. I mean, hey, I need more money, what if my bank gets "robbed"?
If you mod me Overrated, you are admitting that you have no penis.
Except that I'm getting the same thing out of my current iphone for $20 bucks a month (Gophone ftw). Sure a speed boost would be nice, but not 50 bucks a month worth of nice -- especially when the $20 bucks I'm paying per month now will work just fine an an iphone 3g for unlimited 3g data if I can get one without a contract.
Not only that, but with gophone once every 45 days I can buy $10 bucks worth of credit on my sim card for only 2-3 bucks (via ebay, using a new prepaid code) and that I get periodic bonuses when I do refill? My 20 bucks a month ends up being more like $15 bucks a month that I've actually deposited.
Now I do pay 25 cents a minute for the occasional phone call -- but I don't do nearly $55 dollars worth of talking at that price -- and if I did, there are voice plans available I could add to my service -- but I'm perfectly happy with $20 bucks a month data and no voice plan.
Anything you can do to weasel out of being locked into an unreasonable inflated contract monthly cost is worth it.
Can't say I wouldn't laugh, either - entering into an agreement with every intention of breaking it, and being willing to file a fraudulent police report just to save yourself some money? What a world class fucking citizen you are.
Big "days" in history:
Great moments in time. Well, if you believe the Apple faithful, anyway.
What if the phone gets "stolen"?
Then you might get accused of "fraud".
There's no way (as of yet) to change the iPhone's ESN, so if you report the phone stolen, you can expect the ESN to be barred from US networks (and EU ones, come to think of it) -- and if you try to use it, an alert will be triggered (assuming that AT&T's policies are anything like the policies of the carriers in the EU when it comes to stolen phones.)
The real litigious bastards...
"This option" can refer to the entire "Cancellations/Early Termination Fee" clause rather than just the preceding "three day" sentence, and likely does.
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