All Articles Tagged price

Counting down to its July 11 multi-national debut, Japan’s Softbank has announced (in Japanese, ‘natch) their official iPhone 3G prices and plans. The hardware itself will cost ¥23,040 for 8GB and ¥34,560 for 16GB, a roughly 7% premium over Steve Jobs’ US$199 maximum, amortized over the length of the pre-requisite 2 year contract.

Plans will be color coded, primarily in white, but rumor has it also in orange and blue. Based on the linked-to details, this color system is impenetrable enough I can’t believe North American carriers haven’t rushed to adopt it!

Any Japanese readers who can shed further light on how these charges will shake out on a data-hungry iPhone-class device, please let us know in the comments!

Read Via

Read that title again, and realize that the iPhone 3G will sell for LESS than the infamous price drop given the original iPhone before the holidays. (Recap: it’s started at $599 and was dropped to $399 with early adapters getting an equally infamous $100 Apple Store gift certificate Jobs-a-culpa).

And while the price drop was big news then, the retail price of $199 should be HUGE news today.

At $199, that’s HALF the price of the original iPhone at its lowest. It’s the SAME price as an 8GB iPod Nano. It’s LESS than an iPod Classic, and MUCH LESS than an iPod Touch!

When we consider the possibility of carrier subsidies on top of that (Europe has been heavily rumored, with Orange at the extreme gossipy end of giving them away free to current iPhone owners), the iPhone may just be cheaper than “competing” Blackberries, Windows Mobile, and Treo smart phones.

Profit margins (averaging 30%) on hardware have historically been Apple’s bread and butter, but this isn’t the personal computer market (where they’re a founding name) or the MP3 player market (where they have a dominant market share already), this is a much bigger, much less saturated market for Apple. Consumers will buy for a variety of reasons. Features often tops the list. Fashion certainly plays its part. But price can be the difference between dream and reality for a lot of shoppers.

Apple knows this, and they’ve developed an unparalleled 360 degree, spherically integrated business model to support it. A share of App Store sales and MobileMe subscriptions are just two examples surfaced today. Apple Retail Store profits, accessories, Mac hardware, licensing fees, iTunes sales, and a host of other factors let them maintain profitability while minimizing sticker shot for their users.

Steve Jobs once said that the mistake made by the management prior to his return was to go for money rather than market share. By keeping high prices in the present, they all but killed the platform’s future.

Judging by today’s WWDC 2008 Keynote, Jobs learned that lesson well.

8GB iPhone 3G for $199. Perfect price-point storm?

What do you think?

Sorry to rain on the iPhone 3G parade but it has to be done. Here’s some not so great news about the iPhone 3G. The iPhone 3G data plan is going to cost $30 per month. That’s $10 more than the current iPhone plan. On top of that, current iPhone owners will have to sign a NEW 2-year contract to use the iPhone 3G. Meaning, buying an iPhone 3G won’t be a seamless upgrade in the traditional sense. Granted, AT&T won’t count the remaining years on your current iPhone contract to the new iPhone 3G contract, the fact that you have to sign a new contract plus the added cost per month just doesn’t sit right with me.

Look at it this way, the iPhone 3G costs $199. Hip hip hooray right? Not quite. We have to add the cost of the added monthly fees. First we multiply the 10 dollars more a month by 24 months (the life of a 2 year contract) which equates to $240 dollars more to use the iPhone 3G’s data plan versus the original data plan. Now for the simple math, $199 (cost of the iPhone 3G) + $240 (cost of 3G data vs EDGE data over 2 years) = $439 over the lifetime of the contract. That’s actually a $40 dollar increase from the current iPhone, not quite the ‘half price’ that we’re being marketed to believe.

Also, it looks like AT&T will discontinue their pre-paid, GoPhone option meaning there is no alternative than being tied into a 2 year voice+3G data contract under AT&T. At least before, some users could choose to use the iPhone as a pseudo-data only device.

Perhaps its because the old revenue sharing model of the original iPhone is no longer in effect, but it looks like AT&T has taken back control of data plans and is positioning the iPhone 3G to increase subscribers and broaden market potential. The carrier subsidy is theoretically included in the $199 price, essentially AT&T is giving Apple the money upfront instead of through a month-to-month revenue sharing plan. Do we as consumers win out? Depends what your perspective is. The iPhone 3G is still a great phone and a steal, but AT&T & Apple are obviously not in the same relationship they were in just one year ago.

So when the iPhone 4G comes is AT&T going to raise our data prices to $40? Will it stop? What do you guys think of this? Does it change your perspective on the price of the iPhone 3G?

UPDATE: Gizmodo is also reporting that the iPhone 3G can only be activated in store via a 10-12 minute process. Also, a fine might be levied to those who don’t activate the iPhone 3G within 30 days. It seems like the iPhone no longer carries that unique badge of being separate from the rest of the other phones in AT&T’s lineup anymore..