iPhone Users Angry Over AT&T Upgrade Policy

All is not sweetness and light in the wake of the Apple WWDC kickoff announcements, especially concerning the evolution of the iPhone. Reader Hugh Pickens writes: "AT&T will offer the new iPhone 3G S when it debuts later this month at a cost of $199 and $299 for the 16GB and 32GB models, but only to new customers and those who qualify for the discounted price. AT&T subscribers with an iPhone 3G who are not eligible for an upgrade — those not near the end of their two-year contracts — will have to pay $200 more — $399 for the 16GB model and $499 for the 32GB model. 'This is ridiculous and slap in the face to long-time loyal iPhone customers like me who switched from T-Mobile and the only reason was the iPhone,' writes one unhappy iPhone customer. 'We have to mount a vigorous campaign to change this policy. Call your local AT&T and ask for the manager and complain. Send e-mails and post in forums everywhere.' The issue is spurring heavy debate on support discussion forums, with some customers supporting AT&T. 'The option you have is to honor the contract you freely committed yourself to,' says one forum member. 'If you want to upgrade early then you will have to pay full price with no subsidy discount. You can't blame anyone but yourself for your predicament.'"

This is nothing new.

[JimXugle]

If you had an Original Motorola RAZR and you wanted a new one, you had to pay full price.

I fail to see the issue here.

Re:BooHoo

[puck01]

I have to agree. I'm not a cell phone guru by any measure, but only offering the discount rate every two years seems to be a fairly standard term in my experience.

Re:READ THE ARTICLE, FOOL!

[jchawk]

They are absolutely not doing this. I am an existing AT&T customer who has an iphone. I am no longer under a current contract as I have been waiting for the new iPhone. I just double checked before posting and I qualify for an upgrade to the new iPhone if at the discount pricing if I am willing to sign a 2 year agreement with AT&T.

Apple doesn't subsidize these phones the phone carriers do.

Nothing to see here but confused forum posters and bloggers move along please.

Re:iPhone Users?

[icebike]

No, you can't sell your iPhone right now for $400.

Sorry, take a look at the current prices for locked iPhones on Ebay. Falling like rocks.

Re:-1 Flamebait

[Wovel]

It is much more than a fancy phone or even a blackberry. You are not really comparing apples to apples. (sorry). Yes it is a gadget and no it is not necessary, but no phone is really necessary. Some people want to have one device they can use for phone, email, scheduling, music, games and whatever the other thousands of apps do.

Having said that, this whole thing is silly. Whole world is turning in to a bunch of entitlement addicts not willing to live up to their obligations.

Customers?

[aaandre]

The shareholders are the customers. Service subscribers (you) are the product. Your only power is to vote with your dollar, by the numbers.

Know your place, know your options.

Oh, and apple product update cycles are pretty predictable.

Re:Or..

[SwabTheDeck]

Just because they were generous when the 3G came out, does not obligate them to do so again.

It wasn't really that they were "generous" about the 3G. It was more that the original iPhone wasn't subsidized at all. Basically, they were giving a subsidy to people who had never really received one previously. Either way, this complaint is stupid. Every other US carrier and phone manufacturer has these exact same terms. Can someone explain to me why it is that when it's Apple + AT&T, it becomes an unbearable outrage?

Re:BooHoo

[cgenman]

According to AT&T's announcement [att.com] from 2008, their current early termination fee is 175 dollars minus 5 dollars per month that the contract was completed. For half-way through a 2-year contract, that's 115 dollars.

So if you are thinking of paying the extra money and upgrading your phone, first pay the 115 bucks and cancel your account. Then apply for a new account with the no-contract discount. Instead of paying 399 for the phone, you'll only pay 314, or a savings of 85 dollars.

Half subsidy

[cybereal]

Actually what is being offered is a compromise. The full retail value of the 32 GB model is $699 not $499. AT&T is offering those iPhone owners who purchased their 3G upgrade last year, under the terms of a 2 year subsidization contract, the opportunity for a special upgrade at half the subsidization cost. So, for example, when I bought my iPhone 3G last year on day 1, even though I promised to complete an entire two year contract to cover the major discount offered at the time, I will still be able to restart a new two year contract and be rewarded with a $200 discount.

So even though those with no further contract obligations (actually, in many cases you can upgrade at full discount after only 18 months of your 24 month contract) and those new purchasers will get a nice $400 discount, I think I'm getting a pretty honest deal with a half discount halfway through the obligation.

However, many people are clearly confused for various reasons. One cause is likely that many of these iPhone customers were never smartphone customers before. These people had no idea just how much money smartphones cost MSRP. The other part of it is original iPhone (Edge) buyers were not subsidized at all, and when the 3G came around, the offer was presented as though it was a special situation allowing for an early upgrade. Well that is partly factual, if you wanted to upgrade to any other phone you would not have been able to at only one year. I find this aspect to be particularly disgusting on AT&T's part, but it's all part of the contract... At any rate, since there was no subsidization in the original two year contracts for AT&T to cover, it was a no-brainer for them to offer full subsidization to 3G purchasers.

So ultimately, many people are expecting to get exactly the same full subsidization "special" offer they got with the 3G but there has never once been any promise that they would.

So I say: If you're not happy with the pricing, don't buy the new phone. If you feel bad about the whole situation, at least try to fully comprehend what happened and why the 3G's subsidization was not nearly as special as it seemed (AT&T sacrificed zero subsidization from your original contract whereas now they are offering to sacrifice half of the one from the 3G). It's understandable to be dissatisfied with an offer regardless of the terms, but not understandable for people to go all emo over the terms as though they were somehow owed or promised something else when they obviously weren't.

For the record, I intend to pick up a 32gb upgrade for $500 because frankly, I was happy to buy the original 8gb for the full original price. To me it's valuable for the added space alone. Everyone has to make this decision for themselves obviously but at least have the character to realize you are not being ripped off, and you are not somehow owed a better offer just because you really want the phone.

Fandom does not make you special.

Re:BooHoo

[Anonymous Coward]

Wha? You don't get to keep your phone number in teh US of A when you change contracts?
Hahahahahahahahahahahaha.
Losers.

Re:BooHoo

[SyncNine]

Exactly -- I worked this out with my fiancee. She was about to buy a new iPhone anyways so we signed her up for a new plan and I paid for the phone. She gets my 16GB iPhone 3G when the new one comes in and I get the shiny new 32GB iPhone 3G S and only paid $299 for it.

On a side note, all you clowns complaining about $499 for an upgrade price, for some reason my account didn't even qualify for that upgrade -- they wanted $699 from me, claiming I wasn't eligible for upgrade pricing until Dec 2009. $322 and change later and I've got a shiny new iPhone 3G S. It's not impossible. One of my co-workers got AT&T to provide him the $299 upgrade pricing just by calling, complaining, and threatening to cancel and pay the ETF. They sent him over to 'customer retention', who asked why he was cancelling and when he told them they offered him the upgrade at the $299 price...

Of course, he started at $499 -- not $699. I figured since my account was already screwed for some reason, I'd leave it be. Plus, if in December they reset my contract entirely for some reason (as the site shows it will), I'll have a free upgrade just in time for the next upgrade next year :P.

Re:BooHoo

[Brian Gordon]

You can keep your number.

Re:BooHoo

[Jophiel04]

You can carry your phone number over from carrier to carrier, but if you cancel your contract you no longer have a claim to that number unless another carrier requests to take over the number from AT&T, which since they were your provider before and after, won't happen.

Sometihng else to consider is that AT&T has no obligation to sell you the second contract, nor can you be certain they don't do some sort of blacklisting of people who cancel their contracts. Seems like a lot of hassle and risk for saving $85.

Re:Bingo!

[thejynxed]

Here's why:

iPhone 3G-S

(Currently, the processor is assumed to be an ARM, but unknown version and clock speed, Apple makes vague claims about being twice as fast on average as the ARM 11 in the previous iPhone 3G)

Camera: 3.0 megapixel autofocus with macro mode and auto white balance. -- You mean I can finally take outdoor shots at the Audubon and have them look somewhat decent? AND be able to send them back to my PC remotely? AND not have to lug along my laptop? HELL YES.

Video: 30fps VGA with on-device editing capability -- Now you don't need to jailbreak your phone to record video. Hallelujah.

Voice Control: Dialing, music control --- I hope it actually works, and if it does? Sweeeeeeeeeet.

Nike+ Support: Yes - For you exercise nuts.

Networking: 7.2Mbps HSDPA, WiFi, Bluetooth 2.1 + EDR --- This alone makes it worth the upgrade, note that the 7.2Mbps is double what the old iPhone 3G has to offer. Essential for making tethering actually useful.

Oil/Water resistant finish: Yes - Less smudges? Finally.

Integrated Magnetic Compass: Yes --- Awesomesauce.

Headphones: Inline remote for music control --- Remote control my iPhone music playing? ABOUT DAMNED TIME.

Battery Life: Up to 5 hours talk time / data on 3G, 12 hours on 2G. Up to 9 hours data on WiFi. Up to 30 hours audio. Up to 10 hours video. -- Standard 3G talk time is the same as before. 2G, WiFi, audio and video are all extended a few hours each, with the largest allotment going to audio @ a 4 hour increase.

I hope this answers your question as to WHY people would want this over the old craptacular 3G iPhone.

Re:BooHoo

[natemc]

You do have to wait 90 days to open a new account with them. I had an overzealous AT&T manager cancel my phone service after my 3rd Sony Ericsson broke in less than a week. I went to another store to open an account to only be told the above. So just be warned that you will be without for 3 months, at least.

Re:BooHoo

[Ziwcam]

Greetings from a EU citizen. You guys need to lobby for number portability. It's a big step towards more competition when customers can switch to another provider without worrying about losing their phone number.

We have number portability. What these folks above me are talking about is switching to the same provider and keeping your phone number. It might be possible in theory, but obviously the company is on to those tricks, and so the systems aren't set up to allow you to port a number from a current AT&T account to a new AT&T account and get the "new account" equipment discount.

Re:BooHoo

[JustNilt]

Full disclosure: my soon-to-be-ex wife works at AT&T and often got calls like this when she did billing support.

The variables involved in whether you get an early upgrade are weighted in how much you cost the company. If you're always calling for support or whining and demanding credits here and there you're likely to be told to pound sand on any early upgrade. The agents have a screen that tells them whether you are a profitable customer worth locking in or not.

Re:Whoa! ATT sucks balls?

[SaDan]

Yeah, replying to an AC, but I have a G1, so here goes:

A.> Yeah, it can. Like run multiple applications at the same time that sustain network connections when you background each application. Try running several SSH connections at the same time off of the iPhone, and switching to the browser and back.

Poorly coded base OS? You mean the one that came with cut and paste support the minute it hit the stores? The one that supports Flash? A micro-SD card slot? The one you don't have to use iTunes with to transfer content because it will show up as a USB drive on almost any modern computer?

B.> That's your opinion. Personally, I'd rather have form over function if it means getting the job done. The G1 has an excellent keyboard, compared to what you get (or don't get) with an iPhone. Why give up screen real estate for a lesser on-screen keyboard?

C.> Go pay your phone bill. Enjoy the cost of that data plan!

D.> Let's hope it's free like all the other apps I have loaded on my G1.

The iPhone works for a lot of people, including some of my friends. The G1 works better for me, and I have no problems with T-Mobile's network. As far as 3G goes, I have it disabled on my phone to save battery life. I have no issues using 2G speeds for my needs.

If you want REAL speed from a cell network, then neither AT&T or T-Mobile can offer what Sprint or Verizon can with their EVDO networks. It's not even a comparison, provided you have the coverage.

Re:BooHoo

[NovaHorizon]

only if you port out to another carrier, or wait for the number to re-enter the pool. Otherwise I don't think they have access to the tools needed to regrab that number.

Re:BooHoo

[roc97007]

Don' look at me, I have no intention of owning one of those things any time soon. With phones, I tend to choose carefully, buy once, and then keep it until it can't be fixed anymore. Previous phone a Palm 680, and frankly it was somewhat of a relief when it finally quit. Current phone a Blackberry Bold, and I plan to keep it for a good long time.

Frankly, I observe without understanding this compulsion to have every new thing. If your phone was good enough a year ago, isn't it still? If it wasn't, whyinhell didn't you buy something that was?

Mind you, if the iPhone had had mms and cut-n-paste and stereo bluetooth and a decent camera with video and flash (which it still doesn't) a year ago, I might have gotten it instead of the Bold, which does have these things. But it didn't, so I didn't. And even then, the lack of a micro-sd slot may have been a deal-breaker.

But all this is moot. I got the phone I wanted. I like my phone. I plan to keep it. I have to question how much you could like your phone if you want to dump it at the first opportunity. And for such paltry improvements.

Re:BooHoo

[Anonymous Coward]

San Antonio, Texas, March 31, 2008

So, for everyone who bought an iphone in the last 1 year and 2 weeks the termination fee is only $175! The rest of us still have to pay what was on the contract the day we signed it.

Fixed it for you.

Re:anonymous coward angry over first post

[Trahloc]

Simple answer, go with a different carrier. MetroPCS for instance is cheap with unlimited calls, no contracts, and inexpensive phones (compared to the major carriers undiscounted price). Oh yeah you can't use the phone coast to coast with a whole bunch of dead spots. You also don't have the option of purchasing phones directly from them with any decent features, they're all rather basic unless you transfer a sprint/verizon phone. Thats the sacrifice for going with a carrier that doesn't screw you. They aren't as good, but I prefer paying them and dealing with their short comings than paying cingular/at&t/verizon/sprint greater prices with annoying contracts.

Re:anonymous coward angry over first post

[The_K4]

So Assume someone got a iPhone 3G on July 11 last year (launch day). That's 11 months So AT&T's Early Termination fee is $175 - ($5 * 11) = $120 So pay the $120 and port your number to a cheap pre-paid. Then once you've paid the fee and closed the AT&T account go back as a "new" customer and get the $200 discount! I left my last cell phone provider and moved to a new one simply because when my phone died with 6 months left on my contract it was cheep to break the contract and buy new phones with a discount at a different provider then to replace the broken phone. I figure using this method people could save $80 (but it may mean being without a working iPhone for a couple of weeks). As a side note, about a week after I ported the numbers I got a mailing from the original provider offering me the "2-year contract price on new phones" and 10% off my old plan if I would come back. Not sure if AT&T does this, but after you port the number you my find them willing to play ball to get you back, but YMMV.